NatWest Group has said there is no evidence of discrimination due to political views in Coutts’ decision to close customer accounts, an independent review of the bank found.
Coutts closed about 900 accounts over a two-year period, including those of politicians known as politically exposed persons (PEPs), and not including inactive accounts or customers initiating the closure.
NatWest, which owns Coutts, said lawyers at Travers Smith analysed 84 account closures in the two years to July 28, about a 10 per cent sample of all the relevant cases in that time.
The report found that decision-making was appropriate and consistent with industry standards, and that there was no evidence of discrimination due to political views or affiliations, or any other protected characteristic.
However, Coutts said it recognises there are “lessons to be learned” from the way it communicates with customers.
Nigel Farage
The investigation was launched in July after former Ukip leader Nigel Farage said the high-net-worth bank unfairly closed his account because it did not agree with his political views.
The first phase of the review found that the bank showed “serious failings” in its treatment of Mr Farage, but that the decision to shut his account was lawful and predominately commercial.
Mohammad Syed, chief executive of Coutts, said: “Although Travers Smith confirm that, in general, decisions were appropriate and that there was no evidence of discrimination, it is clear there are lessons to be learned.
“This report reaffirms that there were a number of shortcomings in our approach to account closures at Coutts and, in particular, in the quality and consistency of our communications.
“The experience of some of our customers fell short of what they should expect and we apologise to them.
“We are committed to implementing all of the recommendations made by Travers Smith, including comprehensively reviewing and updating exit and communication processes, so that we deliver a better, more consistent experience for all our customers.”
Proper communication
Coutts may have breached rules set by the financial regulator in some cases by not properly communicating with customers or giving them enough notice when their account was closed, according to the report.
NatWest Group said it was taking steps to improve its processes, including reviewing exit letters sent to customers and refreshing its guidance and training on how complaints are handled.
Former chief executive of the banking group, Alison Rose, left the company in July after admitting to a “serious error of judgement” in discussing Mr Farage’s Coutts account with a BBC journalist.
Coutts chief executive Peter Flavel also stepped down following the debacle.
Meanwhile, the Government is changing the law to make sure banks treat UK-based PEPs as lower risk than those from overseas.
It has also extended the notice period that banks must give customers before an account is closed, and forced them to give “clear and tailored” explanations for why they have chosen to do so, except in circumstances where it would be unlawful.
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