Some charities, churches and other community groups have described being thrown into financial disarray after Barclays shut or froze their bank accounts without warning.
Several of the organisations affected, which include charities helping young people, and a Methodist church in the midst of significant building works, have banked with Barclays for over 20 years. But they say that counted for nothing as cheques and direct debits were cancelled by the bank without warning.
Church staff have even been joking on social media that they finally have something in common with Nigel Farage, who was infamously debanked by Coutts earlier this year.
Robin Sundt, the financial controller at the Surrey-based Clockwork charitable trust, said he has been forced to use his own money to enable the charity to keep functioning after Barclays froze the group’s account overnight.
Earlier this year the bank wrote to Clockwork asking for information as to the identity of its trustees, plus other details.
Sundt said his group, which provides free counselling sessions to children in local schools, sent off all the required information. As a result Barclays said it required Clockwork to change from a community account to a charity account.
“We were told that the process was simple and would take eight to 10 days. But what actually happened was, on 1 November Barclays closed our account and contacted suppliers to say that all our direct debits were cancelled,” he said.
“As a result, our website, which allows people to ask for mental health support, was taken down. We’ve now been without a bank account for almost a month. Numerous donations that we would have normally received can’t be paid in, and I had to resort to paying some bills myself to keep the operation going.”
David Alderman, minister at the Hinton Methodist church in Woodford Halse, Northamptonshire, said his church was another victim, and that it couldn’t have come at a worse time. The first the church knew of the account closure was when their electricity supplier informed them that their direct debit had failed.
“We (similarly) had to send off a whole load of information and understood that we had complied with all their requests. The next thing we know is that the account has been closed down,” he said.
“We are currently in the middle of major renovations and had issued cheques to contractors. To stop everyone walking off the job we have had to use funds from other church accounts. It’s been hugely embarrassing.”
He added: “When we tried to make a formal complaint we were told by Barclays staff that we couldn’t, as we don’t bank there anymore.”
Earlier this month Ogmore Valley Male Voice Choir found its Barclays community account had been closed with immediate effect, again without explanation. The choir, which puts on free concerts in south Wales raising money for local charities, said it had banked with Barclays for 40 years, without any previous problems. The account was later reopened after an outcry.
A Barclays spokesman said: “We take the protection of our customers’ funds and data extremely seriously. As part of our ongoing responsibility to help prevent financial crime and to meet our regulatory responsibilities, we are required to ensure we hold up to date information regarding our customers’ accounts. Customers are also required to inform the bank in a timely manner of any change to their legal status relating to their business, charity or trust.
“During a recent review, we became aware the business (Clockwork) had failed to inform the bank they were no longer operating as a club, association or society, and were operating as a charity in receiving and making donations. It is important our records accurately reflects this business is a regulated charity and it will be necessary for a change in legal status [form] to be completed. This will involve the closure of the customer’s business account and a new charity account opened in its place.”
The bank said it was in the process of reaching a resolution to the Hinton church case.
