No evidence Coutts closed accounts due to political views, report says | Banking
An impartial evaluate has discovered no evidence that NatWest Group’s personal financial institution Coutts has been closing buyer accounts due to their political views, however discovered it might have breached guidelines by failing to give due discover or clarify why they have been being shut.
A report compiled by exterior legal professionals, employed by NatWest after a dispute with the previous Ukip chief Nigel Farage, mentioned their crew “found no evidence of discrimination in any of the exit cases, including no evidence of a customer’s account being escalated for exit, or ultimately being exited, due to their political views or party-political affiliations, or any other protected characteristic”.
However, it mentioned Coutts might have breached City rules by failing to give 60 days’ discover earlier than closing accounts, and by failing to inform purchasers why they have been being ousted.
The regulation agency Travers Smith additionally urged the lender to create extra formal guidelines and procedures for instances the place accounts are closed for causes aside from monetary crime. That consists of business choices, the place sustaining an account is definitely loss-making for the lender.
The report is the final anticipated from the Travers Smith evaluate. The evaluate was launched in July after Farage began a marketing campaign in opposition to Coutts – which caters to the very rich – for threatening to shut his accounts with out rationalization. The scandal snowballed after Farage obtained inner paperwork exhibiting that Coutts was involved about his alleged “xenophobic, chauvinistic and racist views”.
The report launched on Friday mentioned legal professionals did determine two instances the place NatWest closed the accounts of shoppers who it believed have been unaligned with its “purpose” – which incorporates selling variety and addressing the local weather disaster. However, Travers Smith mentioned there have been different elements at play in these instances, together with the truth that they have been too expensive to handle, or posed a reputational danger for the financial institution, and each have been finally escalated to the financial institution’s reputational danger committee.
An earlier section of the Travers Smith evaluate, launched in early November, already decided that Coutts had a “contractual right” to shut Farage’s accounts, and mentioned in November that it had finally performed so as a result of the financial institution was dropping cash by holding him as a shopper.
It additionally mentioned NatWest Group’s ex-chief govt Alison Rose – who was compelled to resign in July – had made an “an honest mistake” by discussing Farage’s accounts with a BBC journalist and that she mistakenly believed his relationship with the financial institution was already publicly identified. NatWest finally determined to scrap almost £7.6m in payouts to Rose over the scandal.
Farage lambasted the ultimate report, claiming it didn’t replicate the views of the financial institution that have been detailed within the paperwork he obtained earlier this 12 months. “The report does however admit that there are serious deficiencies in the way NatWest close bank accounts in such a subjective fashion. The NatWest group now need to take a cold, hard look at their own procedures,” he mentioned.
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Coutts’ new chief govt, Mohammad Syed, who was put in after Peter Flavel was sacked in July, mentioned the financial institution “recognised the need to improve our customer account closure processes and those improvements are already well under way”.
“It is clear there are lessons to be learned … The experience of some of our customers fell short of what they should expect, and we apologise to them.”
