Home Office wrongly denying people bank accounts in 10% of cases

Study of Theresa May’s ‘hostile environment’ measures against illegal immigrants finds high error rate

As many as one in 10 people refused a new account because they failed an immigration status check were wrongly denied access to Britain’s banking system because of mistakes in Home Office records, according to an official watchdog.

An examination of Theresa May’s existing “hostile environment” measures against illegal immigrants by the chief inspector of borders also found that hundreds of driving licences had been wrongly revoked after Home Office mistakes in identifying people as remaining in Britain unlawfully.

David Bolt, the chief inspector of borders and immigration, said – after uncovering the 10% error rate in refusing new bank accounts in his 2016 report – that the Home Office “failed to appreciate the potential impact of such wrong decisions on those affected”.

His first report on the impact of the government’s hostile environment measures said the Home Office did not know how many people had been refused new bank accounts since the measure was introduced in 2014, as there was no requirement on the banks or building societies to keep a tally.

But in a sample of 169 cases in which people had been refused accounts because of a match with the Home Office database, the inspectors say they found 17 who should never have been on the list of disqualified people because they had the legal right to live in Britain. Inspectors also found 250 people whose driving licences had been wrongly revoked.

Philip Augar, a former TSB board member, warned on Friday that mistakes would be made when banks and building societies began quarterly immigration status checks on 70m current account holders in January 2018.

He told the BBC: “This is in the hands of the Home Office and the banks, neither of which are exactly known for flawless execution. What happens when something goes wrong, if a bank account is frozen and the owner is entirely legal or if they’ve simply got the wrong name?

“Resolving those situations will be, in some cases smoothly done, but I can imagine it being an absolutely nightmare for some poor individuals.”

Banks and building societies are being required every three months to carry out immigration status checks on every current account in Britain against a Home Office-supplied database of people who face removal or deportation or have absconded from immigration detention.

They will be required to close the accounts of those whose names are identified as disqualified persons on the database run by Cifas, an anti-fraud organisation, using Home Office data.

The banks and building societies have been advised that their default position in the face of a customer complaining about a mistake should be to refer them to the Home Office, regardless of what documentary evidence of their legal right to stay in Britain they may provide.

Responding to the Guardian disclosure that the banking checks are to start in January, Liberal Democrat Brexit spokesman Tom Brake said: “This is yet another sign that the Conservatives are hauling up the drawbridge and demonising immigrants. We should be very clear that immigrants have contributed much more to Britain’s economy and society than they have taken from it. The Conservatives are already winning their war on immigration by crashing the economy – as a result key workers such as nurses are leaving in droves.”

A Home Office spokesperson defended the introduction of the checks: “We are developing an immigration system which is fair to people who are here legally, but firm with those who break the rules. Everyone in society can play their part in tackling illegal migration.

“As approved by parliament in December 2016, from January banks and building societies will be required to carry out regular checks on the immigration status of all current account holders against the details of known illegal migrants to establish whether their customers are known to be in the UK unlawfully. This is part of our ongoing work to tackle illegal migration. People who are here legally will be unaffected.”

• This article was amended on 25 September 2017 to correct the spelling of Philip Augar’s last name, from Auger as an earlier version had it.


Alan Travis Home affairs editor

The GuardianTramp

Related Content

Article image
Home Office suspends immigration checks on UK bank accounts
Decision is second such U-turn following NHS data-sharing after problems highlighted by Windrush scandal

Jamie Grierson Home affairs correspondent

17, May, 2018 @10:14 AM

Article image
Home Office 'wrongly tried to deport 300 skilled migrants'
Teachers, doctors and lawyers among those wrongly forced to leave UK, review finds

Amelia Hill

23, Nov, 2018 @1:11 PM

Article image
Windrush backlog reaches 3,720 cases, Home Office reveals
More than 1,000 wrongful immigration offence reviews not started two years after scandal

Amelia Gentleman

30, Apr, 2020 @9:58 AM

Article image
Eight-year-old boy takes Home Office to court for denying family benefits
‘No recourse to public funds’ policy puts migrants at increased risk in pandemic, boy argues

Diane Taylor

06, May, 2020 @1:29 PM

Article image
Home Office faces legal cases over Zimbabwean asylum seekers
Legality of allowing Harare officials to interview those awaiting removal questioned

Frances Perraudin

05, Jan, 2020 @5:07 PM

Article image
UK banks to check 70m bank accounts in search for illegal immigrants
Exclusive: From January banks will be enrolled in Theresa May’s plans to create ‘hostile environment’ for illegal migrants

Alan Travis Home affairs editor

21, Sep, 2017 @7:00 PM

Article image
Bankrupt people 'wrongly denied basic bank accounts'
A report by Citizens Advice says decision to limit account availability to bankrupt people is 'demoralising and impractical'

Lisa Bachelor

12, Jul, 2010 @9:58 AM

Article image
Home Office pays out £21m after mistakenly detaining 850 people
Wrongful detentions came as immigration staff chased bonuses, figures show

Amelia Gentleman

28, Jun, 2018 @5:00 AM

Article image
Deportation flights for 37 people cost Home Office £443,000
Flights in late 2019 cost average of £12,000 per person, freedom of information response shows

Diane Taylor

12, Feb, 2020 @2:44 PM

Article image
UK’s people trafficking referrals at record high, Home Office data shows
Government’s system for potential trafficking victims to access support had 4,171 referrals from April to June

Diane Taylor

11, Aug, 2022 @1:29 PM