By Tony O’Reilly-
The UK’s financial regulator, the Financial Conduct Authority (FCA), is under scrutiny for seemingly prioritizing the concerns of politicians over those of ordinary citizens who have suffered the closure of their bank accounts.
Jeremy Asher, (pictured)a renowned senior regulatory legal consultant at the law firm Setfords, has expressed concerns that risk-averse banks are increasingly relying on artificial intelligence (AI) to close the accounts of individuals listed in fraud risk databases, even though these individuals may not have committed any wrongdoing, but their details appearing on such lists result in account closures.
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My Asher focuses on challenging Cifas and other fraud markers erroneously issued by banks against individuals wrongly suspected of fraud and other financial crime.
This is because such markers can have devastating impacts on lives, careers and businesses and are technically difficult to challenge.
According to the veteran lawyer, banks and other financial institutions use automated processes that have a low burden of proof to load markers, but then require a very high standard of proof of innocence to convince them to remove them.
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Speaking to The Eye of Media.Com today, Mr Asher lamented the pervasiveness of the debanking problem in the UK.
He said: ‘I have been dealing with at least 200 inquiries a month about the banks of customers being closed down without a proper investigation. This is happening day in day out with clients of mine going suicidal about.
”It has been going on consistently since lockdown
‘I am genuinely finding people who have done nothing wrong having their banks shut down because banks use AI and automated services with a low burden of proof to load markers, then require a high standard of proof to remove them.
‘If the banking organization believes it has a high suspicion, it will load a marker, yet there could be a perfect explanation. Yet, no investigation is conducted., and there is no appeal mechanism.
‘The customer may be a victim themselves who has been hacked. A lot of people simply don’t have the resources to fight this. The data bade needs to be regulated, there needs to be oversight, a standard used to investigate suspicious cases.
‘The banking industry may hate me for this because what my recommendation means is spending tens of thousands of pounds to hire real people to investigate suspicious cases, rather than use automated processes. This has to be put to a criminal standard of proof, not a civil standard of proof
‘This is ruining a lot of people’s lives
‘Banks do not tell customers when a marker has been loaded which causes issues when trying to find evidence of innocence – markers last for up to six years.
‘I have saved many careers and businesses from ruin, successfully challenging many financial institutions.
Mr Asher has 25 years post qualification experience and previously created and headed the Fraud & Business Crime team of a top 100 law firm, steering it to top rankings in Legal 500 for 5 consecutive years.
Abrupt Termination
Approximately 340,000 individuals have experienced the abrupt termination of their banking services within the past year, leaving many in financial turmoil.
However, the FCA’s recent announcement of a review into the treatment of politicians by banks has raised questions about potential double standards in addressing these issues.
The controversy erupted following former UK Independence Party (UKIP) leader Nigel Farage’s allegations that his account with the exclusive private bank Coutts was closed due to political reasons.
The FCA swiftly responded by pledging to take “prompt action” if any “deficiencies” were found in how banks had treated politicians.
While the FCA has initiated a broader review into the reasons for account closures by banks and is expected to provide an initial assessment later this month, lawyer Jeremy Asher, who specializes in the practice known as “debanking,” has accused the regulatory body of acting more expeditiously in addressing the concerns of politicians than those of regular individuals affected by account closures.
In order to illustrate the scale of the problem, Mr. Asher highlighted that politicians, often categorized as “politically exposed people” (PEPs), account for less than 1% of the 340,000 account closures. The remaining 99% comprises everyday individuals who find themselves grappling with financial difficulties through no fault of their own.
Mr. Asher asserts that banks are utilizing AI tools to automatically disqualify individuals listed on the fraud risk databases, even if further investigation could exonerate them. Additionally, he has emphasized that some individuals’ data has been incorrectly uploaded to these databases.
In light of these concerns, Mr. Asher calls upon the FCA to impose a strict and transparent code of conduct for banks regarding account closures.
This code of conduct would necessitate banks providing customers with a “specific, contestable reason” for closing their accounts and establishing a clear appeals process.
Furthermore, Mr. Asher urges the UK government, particularly Chancellor of the Exchequer Jeremy Hunt, to reconsider the FCA’s remit.
He suggests that the FCA’s oversight should encompass the activities of the fraud marker database operators responsible for many of these account closures.
In a letter to the Chancellor in early August, FCA Chief Executive Nikhil Rathi expressed support for the government’s plan to extend the notice period for account closures from 60 days to 90 days.
The FCA intends to collaborate with banks to ensure effective implementation and take action if necessary once the amended legislation takes effect.
Mr Asher has set up a petition calling for change on this very important matter.
However, the ongoing debate underscores the need for a comprehensive solution to address the challenges faced by individuals affected by bank account closures in the UK.
This publication intends to closely monitor the progress made in relation to the important issues raised by this eminent lawyer.
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