If you’ve spent any amount of time browsing the internet, particularly social media or well-known financial forums, there’s a chance you’ve seen comments similar to the above; you might have also read reviews or general posts about banks freezing customer accounts.
The more curious amongst you might have even wondered why a bank would take such action - especially as it can result in complaints, negative reviews and lots of noise on social media.
Others may already know that it is often a legal requirement for a bank to take such an action and in doing so they must have good reason.
Here at Starling, we think it is important to be as transparent as possible - so, this blog will focus on the mysterious world of account restrictions. We’ll tackle some of the common myths, provide insight into our responsibilities and what might be going on behind the scenes.
Why do Starling do it?
Starling Bank will only restrict or close an account as a last resort.
We want everyone to be able to manage their finances 24/7 and we understand that a restricted account can be distressing. However, it is incredibly important both that we protect our customers and combat financial crime, if we suspect something untoward.
As you may know, it’s also our responsibility to review and monitor both accounts and transactions for unusual activity, and take appropriate action.
Regulations that keep us all safe
If, like Starling, you want to change banking for the better, you have to become a regulated financial institution - our regulators are the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA). This means that we have a requirement, by law, to prevent the misuse of our accounts and protect our customers. You might have heard of some of the acts/regulations that we adhere to, for example:
- Proceeds of Crime Act 2002
- Money Laundering Regulations 2017
- Terrorism Act 2000
Hopefully, the above introduction explains why as a regulated institution, we do what we do. But, without giving too much away (obviously we don’t want unscrupulous individuals to figure out how to get round our controls!) I thought it may be useful to explain how we do this.
We use some seriously clever tech, designed and built by some very smart people - which assists our financial crime team in keeping an eye on all of our accounts.
Now, let’s tackle some of the more common questions...
Why would you restrict or close an account?
There are several reasons a Starling account may be restricted - we can’t elaborate on every possible scenario, but we’ll run through some possibilities below.
Don’t worry, where we are able to, we’ll be in touch to let you know and outline anything we require to speed up the process.
We have reason to believe your account isn’t safe
Keeping our customers safe is a priority.
If we have any reason to believe your account, or money, isn’t safe - for example, if you granted a third party access to your account, or they gained it without your knowledge, our financial crime team will take the appropriate action.
This could mean your account is restricted, whilst we review the account or speak to you, to resolve the issue.
Our tech has spotted something unusual
Our tech is designed to spot activity that can be indicative of financial crime, or otherwise appears to differ from the normal behaviour of an account.
Criminals may attempt to use UK bank accounts to launder the proceeds of crime, commit fraud or fund terrorism - our financial crime team will restrict any accounts if they have reason to suspect any of these offences to be taking place, as will our automated monitoring.
We have some of the brightest financial crime minds around continuously developing our tech and reviewing our accounts - if we suspect an account is being misused, we will investigate and we may report it to and liaise with law enforcement in any such cases.
Something isn’t right
Quite simply - something isn’t quite right.
It may be that we need some additional information from you, if so - we’ll be in touch, it could be that another financial institution has contacted us regarding an account, prompting a review, resulting in the account being temporarily restricted.
Rest assured, our team are on it, we aim to resolve the issue as quickly as possible.
Request from law enforcement
From time to time the Police, Courts or other law enforcement bodies, may contact us requesting an account be temporarily or permanently restricted.
We cooperate fully with any such requests.
You’re in breach of our terms and conditions
If we suspect an account is in breach of our terms and conditions, we’ll be in touch to inform you and resolve the issue, where possible.
If the activity continues, or we’re unable to satisfy ourselves that the account is operating within our T&Cs, it’s possible the account will be restricted or notice of closure will be issued.
You can find the most recent version of our terms and conditions on our website.
We got it wrong
We can get things wrong too - we’re human, after all!
Sometimes, after reviewing an account, we realise we’ve made an error. This happens very rarely - but it is understandably frustrating.
If this happens, we’ll resolve the issue as soon as possible and get your account fully functional again.
As I mentioned earlier, the above list isn’t meant to be exhaustive, but I hope it provides some additional insight into why we may restrict an account. There are many more scenarios where our team would be required to take action.
Doesn’t restricting an account cause complaints / negative reviews?
Not always. Our investigations team work fast - many accounts which have been restricted are quickly back to being a fully functioning account after the initial review.
Of course, there are rare occasions when we’re unable to lift the restriction. So, understandably, we sometimes receive negative communications and complaints. In these situations, we’re usually unable to provide any additional detail - it’s the law.
We’ll address all complaints raised about actions taken against accounts - our complaints team aims to resolve all complaints with the best possible experience, but we also understand that outcomes can be disappointing, so we provide escalation options (such as referral to the Financial Ombudsman Service).
From a communications perspective, we’ll never discuss an account publicly, so you shouldn’t expect to see a detailed response from us to comments on social media platforms.
It is also worth noting that repeat complaints, vocal individuals across social media channels and negative reviews are often used as a tactic to apply pressure. In some cases, this is because the individual is unhappy that we’ve prevented or detected a crime.
If a situation has reached such a stage, we’ll be confident in our decision, as I have referenced previously, such decisions are not made lightly.
It is very important to us that we get this right - to protect our customers. It is also our legal responsibility. In all cases we are acting as quickly as we can with the minimal possible impact.
If you’re interested in learning more about financial crimes, including how you can protect yourself, do check out my other blog posts.
Until the next time!