Was Nigel Farage De-Banked for Being a Politically Exposed Person?
July 7, 2023
Why was Nigel Farage de-Banked? The right-wing British politician is making the headlines, for Coutts closing his business account. The leader of the UK Independence Party has claimed that his bank cut his business accounts due to his status as PEP (Politically Exposed Person). While sharing his thoughts about the bank’s move through a Twitter video, Farage told that he was being politically prosecuted by the anti-Brexit banking industry.
Farage was later offered to have a personal account at Natwest, which owns Coutts.
Nigel Farage De-Banked- What is Controversy All about?
Coutts cutting off Farage from his business account has stirred controversy for some contradictory reasons.
According to media reports the said bank might have cut off Farage’s account for commercial reasons like not meeting the account threshold. Customers must borrow or invest £1 million from the bank or have £3 million worth of savings. The same bank is known for catering to wealthy customers including members of the British Royal Family.
However, BBC reporter Simon Jacks who earlier reported about Coutts threshold requirements tweeted that other customers of the bank told him that they were not threatened with closure despite falling below the required financial threshold.
On July 3, Farage tweeted “Just to keep you people updated. I had my ninth rejection confirmed”.
Nigel Farage De- Banking- A Politically Motivated Decision?
Since Farage is a popular politician in the UK, his bank closing his account has become a topic of heated debate. For some, it is just a banking conspiracy theory because there are more important things for which the banks should be facing criticism. For his proponents, it was a politically motivated financial censorship or simply an attack on free speech.
It’s not the first time for financial institutions in the United Kingdom or in any other country to face criticism for allegedly discriminating against their customers for political or any other reasons. Recently, Paypal was in hot waters for reportedly shutting down the accounts of the free-speech union and its founder.
Even UK’s Politically Exposed Person’s regime has faced criticism from certain factions since it requires banks and other firms to do excessive due diligence on politicians, their family members, and associates.
While financial institutions around the world are required to do the due diligence on politically exposed persons, that doesn’t mean that being PEP should be enough to end a business relationship with someone. Even as per guidelines by the Financial Conduct Authority, firms shouldn’t close a business with a customer just because they are PEP, instead, they should do due diligence and assess the associated risk.
If Nigel’s claims about him being rejected nine times by the banks are true then it could imply any possible risk assessment by institutes.
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