Crypto Firms, Banks Asked to Discuss UK Debanking, Regulator Says

The U.K.’s Financial Conduct Authority says it facilitated discussions between banks and crypto firms that have been struggling to access banking services in a controversial Tuesday report addressing reasons for debanking in the country.

The report, which follows allegations from broadcaster and former politician Nigel Farage that his bank account was shuttered over his political views, said “the most common reported reasons for personal and business account applications being declined, suspended or terminated were financial crime suspicions identified, due diligence concerns, and inactive/dormant accounts.”

Some crypto firms have been struggling to open a bank account in the U.K. and companies like NatWest have said they won’t open bank accounts for crypto firms.

The FCA report, which compiled data from 34 credit institutions and payment firms, said that crypto was among the industries that some payment account providers did not give banking access to. Although it has “limited time” to dedicate to businesses obtaining bank accounts, the FCA said it has taken steps where it can to influence decisions to ensure market integrity.

Dialogue between crypto firms and banks “can help ensure a fair and balanced approach is taken, clarify approaches and the reasons behind decisions taken, and explore appropriate ways of mitigating concerns and potential risks,” the report said.

Multiple media outlets reported Monday that the FCA report was going to say it found no evidence that banks closed accounts over customers’ political stances, with Farage calling the report “total nonsense.”

“Given the limitations of the data, we have not been able to draw detailed conclusions on the types of personal or business customers affected by suspensions, terminations and declines,” the report said, adding that the cases flagged where the “expression of political or any other opinion” may have been a factor in account closure didn’t pan out and were instead mostly due to customer behavior including racism.

“What we expect and what the regulations expect to adhere to are a risk-based approach on taking on … customers not a broad brush approach,” Emad Aladhal, director at the FCA said in a briefing held on Tuesday.