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New requirement for Banks and Building Societies to carry out immigration checks

Under the Immigration Act 2014, from 1st January 2018, banks and building societies, including banks that are UK branches of EEA banks and non-EEA banks, will be required to carry out checks on existing and new current accounts for the purposes of identifying ‘disqualified persons’. This is estimated to be in the region of 70 million immigration checks every quarter according to the Guardian.

So what is a Disqualified Persons?

This is defined as a person who is in the United Kingdom but who does not have leave to enter or remain and whom the Secretary of State considers should not be permitted to open a current account. This also extends to joint accounts as well as any individual who is a signatory or a beneficiary of an account. There was also a further provision which stated that checks will need to be carried out on any financial product where payment could be made

So what does this mean for the Banks?

Carrying out these checks s could be considered to be an “absolute nightmare” for staff as described by a former board member of TSB.

The purpose behind these checks is to create a hostile environment for illegal migrants who remain in the UK. It expects to identify in the region of 6000 visa overstayers, failed asylum seekers and foreign national offenders who face deportation in the first year of the checks which are to be carried out on a quarterly basis.

When a bank identifies a disqualified person, they will close down the account or freeze it so that it makes it "harder for them to establish and maintain a settled life in the UK". If the account is frozen, then it is likely that they will be unfrozen once the individual has left the country. Individuals who are affected by the account being closed or frozen will be directed to take up the matter with the Home Office.

One of the key concerns that will need to be considered is how this will be impacted following Brexit taking affect, or if this scheme will only affect some EU citizens.

How are these checks to be carried out?

Banks will be required to check every current account holder against a database supplied by the Home Office and held by an anti-fraud organisation Cifas. Once a disqualified individual has been identified, the bank will contact the Home Office. The bank cannot inform the individual concerned. The Home Office will confirm if the individual is a disqualified person and at that point the bank account will close or be frozen. The Home Office will allow access to the funds to cover living costs and legal expenses at an amount deemed reasonable by the Court.

One of the key concerns is if there is an error either, for example, by mistaken identity or inaccurate information. As a result, individuals who do have the right to stay in the UK will be impacted by having their account frozen or closed in error. Further, there are also concerns as to the system itself being slow and complex due to having to liaise with the Home Office and not the bank directly.

How can we help you?

At Lupton Fawcett we provide support to a range of immigration services. The work we undertake in respect to immigration is done on a fixed fee basis which is highly competitive. We are happy to discuss your immigration enquiries further.

Please contact Immigration and Dispute Management Director, Arif Khalfe, for further help and guidance on the points raised in the above article.

Please note this information is provided by way of example and may not be complete and is certainly not intended to constitute legal advice. You should take bespoke advice for your circumstances.

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