UK finance minister to tighten rules on ‘debanking’
Banking rules will be tightened to make sure customers could not have their accounts closed just because others disagree with their political views
02 October 2023 - 17:04
by Alistair Smout, Andrew MacAskill and Huw Jones
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British Chancellor of the Exchequer Jeremy Hunt attends Britain's Conservative Party's annual conference in Manchester, Britain, on October 2 2023. Picture: HANNAH MCKAY/REUTERS
Manchester — British finance minister Jeremy Hunt said on Monday he would tighten banking rules to make sure customers could not have their accounts closed just because others disagree with their political views.
The practice known as “debanking” became a political issue after former Brexit Party leader Nigel Farage said his account at private bank Coutts, part of NatWest, had been closed due to his political positions.
An internal bank document unearthed by Farage later showed the decision was partly taken over his views, alongside commercial considerations.
“Nobody should have their bank account closed because somebody else decides they’re not politically correct,” Hunt told the governing Conservative Party’s annual conference in Manchester.
“We will tighten the law to stop people being debanked for the wrong political views.”
The notice period for terminating an account will rise from two months to 90 days, and banks will have to give customers a “clear and tailored explanations” for why an account has been closed, steps flagged in July.
The finance ministry on Monday set out how these changes would be implemented.
“A public consultation will be launched shortly to consider how these changes are best delivered, before legislating next year, as part of the government’s aim to put an end to de-banking for freedom of speech reasons,” the finance ministry said in a document.
The government will publish draft secondary legislation by the end of 2023 and aim for parliamentary approval in 2024.
Regulators would also be given “the green light to take firm action if any bank is found to undermine or fails to protect the rights of their customers”, the ministry said.
The ministry is working regulators and law enforcement agencies to ensure that banks have “limited flexibility” not to provide 90 days’ notice, or a clear reason for closing an account, where this could mean conflict with other laws.
Banks want the flexibility to avoid “tipping off” a customer that they are being investigated for money laundering.
Regulators said last month there was no evidence so far of accounts being closed due to political beliefs, a finding that Farage ridiculed.
Support our award-winning journalism. The Premium package (digital only) is R30 for the first month and thereafter you pay R129 p/m now ad-free for all subscribers.
UK finance minister to tighten rules on ‘debanking’
Banking rules will be tightened to make sure customers could not have their accounts closed just because others disagree with their political views
Manchester — British finance minister Jeremy Hunt said on Monday he would tighten banking rules to make sure customers could not have their accounts closed just because others disagree with their political views.
The practice known as “debanking” became a political issue after former Brexit Party leader Nigel Farage said his account at private bank Coutts, part of NatWest, had been closed due to his political positions.
An internal bank document unearthed by Farage later showed the decision was partly taken over his views, alongside commercial considerations.
“Nobody should have their bank account closed because somebody else decides they’re not politically correct,” Hunt told the governing Conservative Party’s annual conference in Manchester.
“We will tighten the law to stop people being debanked for the wrong political views.”
The notice period for terminating an account will rise from two months to 90 days, and banks will have to give customers a “clear and tailored explanations” for why an account has been closed, steps flagged in July.
The finance ministry on Monday set out how these changes would be implemented.
“A public consultation will be launched shortly to consider how these changes are best delivered, before legislating next year, as part of the government’s aim to put an end to de-banking for freedom of speech reasons,” the finance ministry said in a document.
The government will publish draft secondary legislation by the end of 2023 and aim for parliamentary approval in 2024.
Regulators would also be given “the green light to take firm action if any bank is found to undermine or fails to protect the rights of their customers”, the ministry said.
The ministry is working regulators and law enforcement agencies to ensure that banks have “limited flexibility” not to provide 90 days’ notice, or a clear reason for closing an account, where this could mean conflict with other laws.
Banks want the flexibility to avoid “tipping off” a customer that they are being investigated for money laundering.
Regulators said last month there was no evidence so far of accounts being closed due to political beliefs, a finding that Farage ridiculed.
Reuters
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