Home Office’s new powers to close or refuse current accounts

On the 30 October 2017, the Home Office introduced new measures requiring banks to verify the immigration status of their current account holders. Following on from this, the Home Office has published Guidance setting out when a current account must be refused or closed as a result of an individual being deemed a ‘disqualified person’. 

The Guidance explains that a ‘disqualified person’ is:

• An individual who is in the UK illegally; or
• An individual who was legally in the UK but their leave has either been revoked or they remained after their leave expired; or
• An individual who is an EEA National subject to deportation and who has exhausted their rights of appeal.

The Secretary of State has directed banks and building societies to close the relevant account ‘as soon as is reasonably practicable’.  However, the banks do have the discretion to delay for a reasonable period if the bank account is overdrawn or where the account is operated by additional individuals (other than the disqualified person) and the closing of the account would adversely affect their interests. 

As these measures were only introduced last week, it is now a matter of waiting and observing how they will be put into practice.  The Guidance indicates that if an individual considers that their account has been closed (or refused) in error, they will need to contact the Home Office rather than the bank.  According to the Home Office, the method for this is via the UK Visas and Immigration complaints process (by telephone, post or email).  

The issue here is that this complaints service aims to respond within 20 working days, during which time the account remains closed.  There does not appear to be any emergency process for escalating a complaint when the account has been closed in error.  Time will tell how effective these new powers are at restricting genuine disqualified persons, and whether unsuspecting individuals are caught in the cross-fire.