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The UK’s Financial Conduct Authority recently concluded its second debanking review of NatWest, one of the major banks operating in the country. According to the review, there are signs that NatWest has potentially violated the FCA regulation.
The second review found potential violations
The review comes after NatWest faced multiple investigations from regulators, as well as a significant backlash for the closure of the Coutts bank account belonging to the Brexit leader Nigel Farage. The incident also led to the exit of the bank’s executive Peter Flavel, as well as its CEO; Alison Rose.
Now, the second review also indicates that there were breaches in regulatory rules. Not to mention Rose’s alleged 7.5 million GBP payout, which came on the heels of a scandal that was scrapped back in November.
In other words, the situation surrounding NatWest is quite complex, with a number of incidents and controversies accompanying it. The FCA noted that it did not find any proof of wrongdoing in its initial findings.
However, the law firm known as Travers Smith also analyzed the data, specifically focusing on the closure of 84 Coutts’ accounts. The data represented a sample of 10% over a two-year period, leading up to July 2023. Initially, the firm confirmed that the bank had acted lawfully and mainly on commercial grounds. However, the second phase of its analysis recorded multiple serious failings regarding the bank’s treatment of Farage.
Coutts CEO admits fault
According to the report, NatWest and Coutts may have violated FCA rules regarding customer treatment and reason for terminating the contract of a user. Coutts’ chief executive, Mohammad Syed, commented on the report’s publication, stating that it reaffirms that there were numerous shortcomings in the approach that was taken to the account closures at Coutts.
He added that there may have also been shortcomings in the quality and consistency of the company’s communications, in particular. He admitted that the experience that some of the customers had while dealing with the firm fell short of what they should expect, and he apologized for that.
Moving forward, he said that his company is committed to implementing all of the recommendations that were made by Travers Smith. That includes comprehensive reviews and updates of exit and communication processes. Syed said that the goal is to do better, and deliver a more consistent experience for all users.
Farage also commented on the report, saying that the NatWest Group needs to take a “cold, hard look at their own procedures.”