‘Barclays shut our choir bank account with little warning after 40 years’: Why is it debanking small community groups?

Dozens of small organisations, from parish councils to choirs and steam train enthusiasts, have had their Barclays accounts closed or restricted without warning in recent months, This is Money can reveal.

Last month we reported that Barclays had closed the bank account of a community garden organisation, leaving them unable to access funds or make payments.

Since then, more cases have come to light, with community organizations telling This is Money that their bank accounts have been similarly closed or restricted, some without any notice or explanation.

Some of these groups have been with Barclays for more than forty years.

Locked out: Dozens of community organizations that bank with Barclays have had accounts closed or restrictions imposed

Ogmore Valley Male Voice Choir discovered that its Barclays account had been closed with immediate effect and without any explanation.

The choir, which performs free concerts for the South Wales village community and raises money for local charities, had banked with Barclays without any problems for 40 years.

That was until one afternoon in October, when the choir’s chairman received a call from Barclays informing him that each of the three accounts had been closed – just hours after he had deposited money into one account.

Barclays could not give him any explanation as to why it had closed.

The choir’s chairman, Peter Morgan, said: ‘We have no idea why Barclays bank has closed our accounts after we have been regular customers for so long.

‘They have left us in the dark and it has put ourselves, and I’m sure many others, in a difficult position.

‘We don’t borrow and we’ve always had credit – so why has it suddenly closed?

‘We give quite a bit to charities, but we also give charity concerts in aid of local organisations.’

In addition, the choir owns its own building and has standing orders for energy and insurance, which are regularly debited from the account, making them afraid that their supplies will be cut off.

Many of the 45 choristers also pay their contributions through standing orders.

On a sour note, Barclays closed the bank account of Ogmore Valley Male Voice Choir without any notice or explanation

Barclays informed the choir that these, along with any checks the choir issued, would not be honoured.

Mr Morgan continued: ‘We are concerned that our energy will be cut off because we cannot access our account to pay the bills.

‘Our treasurer has spoken to Barclays and they say they are going to open new accounts for us, but it will be another seven days before that happens.

‘We’ve probably got close to £30,000 in the accounts that we use to keep this building of ours running, and they say they can’t just hand it over. It must be a completely new account.

We think that because we are a charity and don’t pay fees, this could be part of the reason they suddenly closed us down

‘We think that because we are a charity and don’t pay fees, this could be part of the reason they suddenly closed us down. They have not said if there will be any fees associated with the new bill.”

Most organizations that came into contact with This is Money have low turnover, do not lend money and do not pay costs for maintaining their accounts.

The problem they seem to be facing is that Barclays is treating their accounts as if they were business accounts, when in reality they are not-for-profit micro entities and in most cases there is never more than a few thousand pounds in the bank accounts.

Project 62 is another organization that has had problems with its Barclays account.

The group’s 200 members donate money for the restoration of steam locomotives leased to historic railways. It has banked with Barclays since 1990.

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The organization’s treasurer began receiving letters from Barclays saying they needed to talk to him about Project 62’s “company details” and threatening to close the account if he didn’t respond.

Bryan Stanley, secretary of Project 62, said: ‘Our treasurer spent several hours on the phone with the Barclays Business Banking team explaining our business, but they seemed unable or unwilling to understand what he was telling them .’

After receiving another letter threatening closure, Mr Stanley called the Barclays Business Banking team but was told to call another department to resolve the issue.

Even after the appropriate department was called and all requested information was provided, Project 62 was still plagued by emails and letters threatening that the account would be closed within ten days if they did not respond.

The group told This is Money that no one at Barclays could confirm in writing that the account would not be closed, even though the additional information was provided at Barclays’ request over the phone – which the agent who handled the call said they were . satisfied with.

Mr Stanley said: ‘We feel we cannot believe a word from Barclays now. I wonder if Barclays is looking for an excuse to close our account.

‘We have never had a loan or had an overdraft. Although there is currently only around £7,000 in the account, in the past this has been well over £30,000.”

‘We believe that Barclays sending these emails constitutes harassment and means we cannot believe anything told to us by the corporate banking team.’

Project 62, an organization that restores steam locomotives, received multiple letters and emails from Barclays threatening to close the group’s account

Other organizations also contacted us to tell us about closed accounts.

A ‘good neighbor group’ that provides help to local residents told This is Money that her account was restricted by Barclays after she provided information requested by Barclays’ know your customer team in a letter.

Barclays told the group that it was unable to scan documents sent by the organization’s chairman and as a result had placed restrictions on the account.

The clerk of a small parish council, who asked not to be named for fear that Barclays would restrict or even close their bank account, also told This is Money of ‘bullying behaviour’ suffered by Barclays.

Barclays sent several emails and letters requesting information about the parish council.

Despite repeatedly providing the information, they say Barclays continued to send emails and letters threatening to have the account closed.

The clerk said, “Part of the problem is that you simply can’t talk to anyone. Barclays has unfortunately closed most of our nearest branches in recent years, meaning the nearest branch is over 11 miles away.”

This is Money contacted Barclays to ask why the accounts were closed.

Barclays has since confirmed that Ogmore Valley Male Voice Choir’s account will be reopened and the other accounts will no longer face restrictions or be closed.

A Barclays spokesperson said: ‘As part of our ongoing responsibility to help prevent financial crime and meet our legal obligations, we are required to maintain up-to-date information about the business accounts of our customers, including community groups.

‘We communicate with our customers through a range of communications including by post, online and mobile banking banners from our digitally active customers, as well as reminder SMS text messages and emails asking them to provide us with important information about their business account .

‘This communication contains warnings about account closures. In cases where we do not receive a response with current account information, we will continue to apply card holds and account restrictions, followed by alerts about possible permanent closure arrangements if the issues remain unresolved.”

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