NatWest: Account Terminations and Branch Closures

Debate between Lord Grantchester and Baroness Vere of Norbiton

Wednesday 10th January 2024 Lords Chamber

[Baroness Vere of Norbiton (Con)]

No, I think those comments were very ill advised and I rather wish he had not made them—as I am sure he does. The key to a thriving housing market is ensuring that interest rates come down. To do that, one has to reduce inflation, and that is exactly what this Government are doing.

[Lord Grantchester (Lab)]

It is excellent news that the Government have today commenced the statutory instrument by which so-called “politically exposed persons” will not be subjected to increased monitoring compared with the general public. Will the Minister ensure that banks no longer use the policy of “constant refresh know your client” as an excuse to close bank accounts?

[Baroness Vere of Norbiton (Con)]

I am very grateful to the noble Lord for allowing me to highlight to the House that that statutory instrument, laid before Christmas, comes into force today. It means that banks should not treat all politically exposed persons the same; domestic politically exposed persons, as well as their family members and close associates, will be subject to a lower level of checks. In terms of “know your client”, it is important that we have the right balance between the information the banks have about the client and any concerns about their involvement in illicit finance. There are money laundering regulations in place but they are not prescriptive—firms must apply them in a proportionate fashion and appropriate guidance for banks on customer due diligence has been published by the Joint Money Laundering Steering Group.