27 Oct 2017, 58 mins ago

From 1st January 2018 banks and building societies will be required to carry out can estimated 70 million checks every quarter on current accounts.

Under the Immigration Act 2014, banks and building societies are required to carry out checks when opening current accounts in order to identify disqualified persons.  A  “disqualified person” is defined as “a person who is in the United Kingdom, who requires leave to enter or remain in the United Kingdom but does not have it, and for whom the Secretary of State considers that a current account should not be provided by a bank or building society.”

As well as current accounts for individuals, this also includes where an individual is a signatory, or beneficiary, or adding an individual to an existing account as an account holder, signatory or beneficiary.

As part of the government’s plan to tackle illegal immigrants in the UK, the government will be implementing Schedule 7 of The Immigration Act, which is the “requirement to carry out immigration checks in relation to current accounts.”

To ascertain whether an individual is a “disqualified person,” banks and building societies will be required to check data they hold in relation to the individuals, i.e. name, date of birth, address, against a database supplied by the Home Office and held by an anti-fraud agency (CIFAS), which is in relation to foreign nationals who the Home Office believe are in the UK illegally, and who they deem to be liable for removal from the UK.

If the Secretary of State determines that the individual is a “disqualified person,” they may apply for a freezing order in respect of one or more of the accounts held with the bank or building society that are operated by or for the “disqualified person.”  Whilst the bank or building society is awaiting confirmation by the Home Office the current account will remain open.  It is also unlikely that the individual will be informed that they have been flagged as a potential “disqualified person.”  The freezing order may be made without notice and the Home Office may make exceptions to the order by making provisions to allow the “disqualified person” access to funds to meet their reasonable living costs and legal fees.

There are concerns that the above could result in errors being made and individuals who are legally in the UK having their accounts frozen in error. It also has the potential for the Home Office to use the information to pursue enforcement measures against the individuals identified as being a “disqualified person.” In either case these could result in a lengthy process to get resolved.  


The information in this blog is for general information purposes only and does not purport to be comprehensive or to provide legal advice. Whilst every effort is made to ensure the information and law is current as of the date of publication it should be stressed that, due to the passage of time, this does not necessarily reflect the present legal position. Gherson accepts no responsibility for loss which may arise from accessing or reliance on information contained in this blog. For formal advice on the current law please don’t hesitate to contact Gherson. Legal advice is only provided pursuant to a written agreement, identified as such, and signed by the client and by or on behalf of Gherson.

©Gherson 2017