Caroline Barr, a member of the Financial Services Panel, said of the Bentley case: “The bank is acting as if the account owner is suspected. She may act as if she had no duty of care to that client because she does not have one. In this letter, seen by This is Money and simply signed, the bank referred to Section 11 of its retail agreement. State rules require banks to monitor customers` accounts for the risk of money laundering or financial crime, and atypical transactions can trigger fraud filters. These filters identify connections or payments from countries considered risky and, under the Proceeds of Crime Act 2002, banks must not “spill” a customer who may be investigated. Clients are also not allowed to hear the results of an investigation. The consequences for innocent victims can be devastating, because once a name appears in a fraud database, it may not be possible to open another bank account elsewhere. Barclays` initial reaction was overwhelming. “We have taken the appropriate steps that customers would expect of us if an unusual transaction had been concluded,” he said. “On this occasion, we are pleased that the transaction was real and we are happy to return the money to our customers.” It is worrying that a sign of fraud was so easily placed on an account before being properly examined, as well as the way the banking giant treated a vulnerable customer.
In a third of the cases, the FOS found it in favor of the customer. The Financial Ombudsman Service, which handles unresolved customer complaints, classifies all cases under the relevant financial product, such as giroaccounts, not the nature of the problem, so it cannot say whether complaints about closures are increasing or whether certain ethnic groups are disproportionately affected. Rahman is one of a growing number of customers whose bank accounts have been closed without warning or explanation. Over the past two years, the Observer has been contacted by disoriented readers from all backgrounds – including an economics professor, a migraine charity, a leading campaign group and many ordinary domestic workers whose finances involve nothing more exotic than a holiday in Spain. The Financial Services Consumer Panel, a legal body that defends the interests of consumer policy, says the law needs to be changed to prevent such conflicts of interest between banks and customers. “Barclays can act as if it has no duty of care to this client because it doesn`t have legal duty,” said Panel Member Caroline Barr. “The Financial Services and Market Act states that companies must “treat their customers fairly.” The panel believes that the law should be amended to determine what constitutes a “reasonable” duty of care to ensure that banks act in the best interests of their customers. This case shows the disastrous consequences if they do not. Mr.
Bentley`s case appears to be part of an upward trend, where customers are suddenly “licensed” by their banks and are quickly invited to do business elsewhere. Critics say these rules are enforced by “overzealous” banks.