NatWest decision to close Nigel Farage’s bank
accounts was lawful, says report
Investigation for bank finds ‘serious failings’ in
handling of Coutts move and treatment of ex-Ukip leader
Kalyeena
Makortoff Banking correspondent
@kalyeena
Fri 27 Oct
2023 02.47 EDT
NatWest’s
decision to close Nigel Farage’s bank accounts was lawful but there were
“serious failings” in how it treated the former Ukip leader, an independent
review commissioned by the bank has found.
Lawyers
hired by NatWest Group said the lender had acted “in accordance with the
relevant bank policies and processes” when it decided to shut the accounts
Farage held at its private bank Coutts.
However,
the initial report also identified “a number of shortcomings”, related to how
it reached that decision, how the bank communicated with Farage, and how it
treated his confidential information.
The
Financial Conduct Authority said it had reviewed the findings of the initial
independent report, and said it highlighted “potential regulatory breaches” and
a number of areas for improvement.
That
included how the bank considers the potential closure of accounts, handles
complaints from customers, and the effectiveness of its “governance
mechanisms”.
The NatWest
chair, Howard Davies, said: “This report sets out a number of serious failings
in the treatment of Mr Farage. Although Travers Smith confirm the lawful basis
for the exit decision, the findings set out clear shortcomings in how it was
reached as well as failures in how we communicated with him and in relation to
client confidentiality.
“We
apologise once again to Mr Farage for how he has been treated. His experience
fell short of the standards that any customer should expect. Our job now is to
make sure that does not happen again.
“The bank
is committed to implementing all the recommendations made by Travers Smith and
we are making substantive changes to our policies and procedures, in particular
to ensure that the lawfully protected beliefs or opinions of customers do not
play any role in our decision-making.”
NatWest has
yet to confirm whether it will claw back any pay from its former chief
executive Alison Rose, who quit over the matter in July. Rose has been
receiving pay from a £2.4m package made up of salary, pension contributions and
share-based pay since her resignation.
The bank
expects to issue a statement on the pay matter when it releases the second half
of its review into the scandal by the end of November.
Farage
condemned the report on Friday, saying it “whitewashed” the decision to close
his accounts. “Travers Smith has taken a very mealy-mouthed approach to this
complex issue. The law firm argues that my political views ‘not aligning with
those of the bank’ was not in itself a political decision. This is laughable.”
Documents
obtained by Farage in July showed that while Coutts had considered the fact
that he had fallen below the bank’s multimillion-pound account thresholds, the
bank also decided to close his accounts because of concerns over his political
views, which it said did not align with the bank’s. The Coutts documents showed
the bank believed that his alleged “xenophobic, chauvinistic and racist views”
posed a reputational risk to the bank.
The release
of NatWest’s initial report comes only days after the Information
Commissioner’s Office ruled that Rose had breached data protection laws in
July, when she spoke to a BBC journalist about the planned closures of Farage’s
accounts.
The
breaches were on two counts: first, that Rose revealed that Farage had a
banking relationship with its private bank, Coutts; and second, that she
provided “misleading information” that led the BBC to believe the bank was
closing his accounts for purely commercial reasons, linked to his wealth.
The ICO
said it did not plan to take any further action, given that NatWest had already
launched an investigation into the incident and Rose had stepped down over the
scandal.
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