Chancellor Jeremy Hunt Warns Banks of “De-Banking” Fines
Chancellor Jeremy Hunt has issued a warning to banks, stating that they could face “very large” fines if they close customers’ accounts due to their political opinions. This comes in the midst of a controversy surrounding former UKIP and Brexit Party leader Nigel Farage, who accused Coutts of unfairly shutting his accounts because the bank did not agree with his views.
Following the Bank of England’s decision to raise interest rates to 5.25%, Hunt revealed that he had written to the Financial Conduct Authority (FCA) to investigate the issue of “de-banking”. He expressed concern that this practice may be more prevalent than previously thought, stating that free speech is a fundamental human right and everyone should be able to express their opinions, regardless of agreement or disagreement.
Hunt highlighted that regulations already exist to prevent banks from closing accounts based on political views. However, he disclosed that the FCA has committed to conducting a review on the matter and will report back to him by September. The chancellor emphasized that the FCA has the authority to impose significant fines on banks if they find evidence of widespread de-banking practices, and he is eager to learn about their actions in response.
Farage acknowledged Hunt’s involvement, tweeting, “The chancellor has written to the FCA about my case and the issue of de-banking. Thank you @Jeremy_Hunt”.
This development follows City Minister Andrew Griffith’s promise to crack down on de-banking, as well as the Treasury’s introduction of reforms aimed at increasing transparency regarding account closures.
Coutts Apologizes and Faces Consequences
Earlier this week, Farage revealed that Coutts had offered to reinstate his personal and business accounts. However, he stated that he would continue to campaign on the issue and seek compensation for the ordeal he had experienced.
NatWest, the parent company of Coutts, issued an apology to Farage and initiated an independent review. In the aftermath, Coutts CEO Peter Flavel resigned, and NatWest CEO Dame Alison Rose also stepped down after admitting to being the source of an incorrect BBC story related to the controversy.
Farage obtained a 40-page dossier from Coutts, which indicated that the closure of his accounts was partially due to his views not aligning with the bank’s “values,” including his stance on LGBTQ+ rights and his friendship with former US president Donald Trump.
This incident has sparked a broader discussion on bank account closures and has brought similar complaints to the forefront. The Muslim Council of Britain recently wrote to political leaders, highlighting that the withdrawal of banking services by various high street chains is a common occurrence for many Muslims and Islamic organizations in the UK. The council’s secretary general, Zara Mohammed, called for an investigation and expressed concern over the lack of transparency and recourse for those affected.
Businesswoman and aspiring MP Gina Miller also criticized the banking sector after Monzo Bank closed an account belonging to her True and Fair Party. The bank later clarified that it does not allow political party accounts and acknowledged that the initial decision to open an account for Miller had been made in error.
As the issue of de-banking continues to gain attention, it remains to be seen how the FCA’s review will unfold and what actions will be taken to address the concerns raised by Farage, the Muslim Council of Britain, and others affected by similar account closures.