Stop the Co-op Bank closing support group accounts
Guest blog: Shaun Fensom on the Save Our Bank account closures campaign
Over recent weeks the Co-op Bank has told a number of aid and support groups that it will close their accounts. These include the Palestine Solidarity Campaign and the Cuba Solidarity Campaign.
We have now started a petition asking the bank to "stop closing accounts of Palestine and other support groups."
In addition we have been in touch with some of the affected groups and we have taken it up with the bank. Some of the groups have moved their accounts already, others are keen to stay with the bank.
We have set up a list of affected groups. We'd like to hear of any other groups that have been affected.
Bank claims legal and 'due dilegence' reasons
In a detailed statement to the Save Our Bank campaign, the bank says that it is required to perform due diligence to ensure that transfers to "high risk locations" do not inadvertently end up funding illegal or proscribed activities. We accept that the bank has legal obligations.
But we think that it is closing accounts as a substitute for genuine 'due diligence' - presumably to save costs. We fear that the bank will lose more than it saves because of the impact on its reputation as an ethical bank.
We wrote an open letter calling on the bank to remember its proud tradition of supporting human rights campaigners and to help legitimate support groups to meet the bank's obligations instead of just closing accounts.
In that letter we asked a number of questions. The bank has written to us privately and answered some of those questions. We are pressing them now to let us have something we can publish.
Meanwhile, we still have questions unanswered and we have put some new questions to the bank:
1. In its statement, the bank said it "has made some changes recently to bring it into line with the industry”. We have been contacted by charities that have been refused an account by the Co-op and then accepted by one of the high street banks. Should it be harder for legitimate charities to use the Co-op than its high street competitors?
2. The bank is aiming to provide a high standard of customer service. We have been contacted by groups that have been given no explanation why they have been refused an account. Groups that have been told their account will be closed have been given no explanation why, and given no indication what they can do if they wish to remain with the Co-op. What is the bank doing to address this failure of customer service?
3. Some of the accounts that the bank is closing are for registered charities, and hence subject to close scrutiny by the charity commission. Why is it not possible to tell these charities what additional procedures they should adopt to satisfy the legal obligations of the bank?
4. In its statement the bank cited the problem of money transfers to ‘high-risk’ destinations, and we understand that there are obligations in this regard. We struggle to understand however why this affects the Cuba Solidarity Campaign as an example. What are the criteria that the bank is applying?
5. Are there more charities and groups that will be contacted and asked to close their accounts, or has that process completed now?
Not time to leave the bank
The Palestine Solidarity Campaign (PSC) is bringing a legal case against the bank for closing its account and is asking bank customers to close their Co-op Bank accounts in protest.
We don’t agree with the PSC that we should all close our accounts. We are sticking with the bank. We still think there is a lot worth saving.
In recent months:
- The bank has announced a £1m fund to support co-op development in the UK. This is what our supporters wanted. It is a very significant contribution.
- The bank has signed the Paris pledge not to support businesses involved in coal production - the biggest bank in the world to do so. The bank proudly advertises the fact that it has been admitted to the PAX #DontBankontheBomb Hall of Fame for refusing to finance the manufacture or transfer of indiscriminate weapons. These are glimpses of the bravery that the bank has shown in the past - along with a generous contribution to co-op development.
- When the bank revised its ethical policy we campaigned to make sure that this was not used as an excuse to water it down. Save Our Bank won a commitment not to drop any existing policies and as a result the ethical policy is now stronger than before. We have shown that if we are organised, we have real influence.
- Lastly, what alternatives are there? It's disappointing but important to remember that there are few, if any, banks that offer the facilities that the Co-op does to ordinary customers and that have an ethical policy with any value.
We are angry with the bank's decision this week. We think it's a good example of why we need an independent customer union to keep the bank on its toes. We are stronger if we stick together, and that's why we are staying with the Co-operative Bank.
We do want the bank to change its position. We think they have made a mistake. It is at times like this that a union of customers can have an impact.
We asked Save Our Bank supporters whether we should launch a petition on 38 Degrees to reach beyond Save Our Bank supporters, to ask the bank to reverse its decision and do more to support affected groups. Of some 400 responses, 96% said we should.
We've put that petition live now. If enough people sign it, 38 Degrees may promote the campaign to its wider membership lists. So please encourage people to sign.
See our ethical shopping guide to current accounts to see how the various providers compare.