NatWest: Account Terminations and Branch Closures

Lord Watts Excerpts

Wednesday 10th January 2024 Lords Chamber

[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.

[Lord Watts (Lab)]

My Lords, does it not show the weakness of the present regulation when banks are closing thousands of their branches all around the country, withdrawing services to their customers, and then promising banking hubs that they do not introduce? Do we not need stronger government and stronger regulation?

[Baroness Vere of Norbiton (Con)]

I have to disagree, because that is exactly what we did, by making the change in the Financial Services and Markets Act. We are now putting that into place. Now, of course, we cannot do that immediately. A consultation is live at the moment and it will bring together all the information we need to ensure that customers get the banking services they need.