The UK’s Financial Services Minister States Banks Should Not Close Accounts Based on Political Views of Their Customers

The financial services minister, Andrew Griffith, commented on July 4th that banks should be required to serve their customers regardless of their legal, political views and that anti-money laundering checks should be applied at a proportionate level.

Nigel Farage, the former Brexit Party leader, informed that the bank on July 4th closed his account and as an alternative, it offered him a standard NatWest account instead. An informal question from a member of the Economic Affairs Committee of the House of Lords asked Griffith about recent issues pertaining to the provision of banking services to politicians in general, without making any specific reference to Nigel Farage.

Whilst addressing the concern, Griffith stated, “If executives within organisations hold themselves out to be ‘fit and proper’, then they would not seek to suppress the lawful expression of democratic views.” He explained that, in light of the conduct standards bank executives must comply with, “in terms of lawful freedom of expression, it’s not right that anyone would be debunked on those grounds; that is not acceptable.”

Politically exposed persons are subject to a worldwide anti-money laundering regime, which requires banks to verify the identities of individuals who hold prominent political positions. The Financial Conduct Authority (FCA) now has the authority to review the rules under a new financial services law approved by the British parliament last week, according to Griffith.

In his words, Griffith stated, “The Chancellor and I have requested that the FCA review the application of those rules to ensure that unintended consequences do not occur when a duty of care is imposed on an individual institution. However, sometimes that can go too far.” According to him, the rules should be applied in a proportionate manner rather than universally. “The second thing that we’ve asked is that the FCA look at creating a domestic politically exposed person (category) to reflect the lower category of risk associated with those whose affairs are wholly domestic,” Griffith added to the statement.

Suggested Reads:

EBA REPORT UNCOVERS RISKS OF MONEY LAUNDERING & TERRORIST FINANCING ASSOCIATED WITH PAYMENT INSTITUTIONS

THE EU AND UK ANNOUNCE MAJOR REGULATORY REFORMS TO SAFEGUARD CRYPTO-ASSETS

NFIU INCREASES EFFORTS TO REMOVE NIGERIA FROM FATF GREY LIST