In 2021 you helped the charity, of which I’m treasurer, when its bank account of 25 years was suddenly closed by HSBC. If it hadn’t been for your intervention, Akamba Aid Fund, which helps deprived communities in Kenya, faced closure, too. Since then, we had an application to a development fund refused because we were a charitable trust and not a charitable incorporated organisation (CIO). I discovered that the Charity Commission has been encouraging charitable trusts to change their status to a CIO since 2013. I began this process, was re-registered by the Charity Commission, and asked HSBC to transfer our assets to the new entity. In its eyes, however, we were a new charity and had to apply for a new account. Our application was refused. This has just about finished me off when all we want is to improve lives.
RL, Yeovil, Somerset
Here we are again – a bank whose pledge is to “create a better world” seemingly taking fright over links to Africa. Research by the Institute of Economic Affairs found that charities have been disproportionately penalised by “over-zealous” anti-money-laundering rules. Since the rigorous account vetting required costs banks more than defenestrating customers with links to countries deemed high risk, they are increasingly choosing the latter.
The Charity Commission told me that 42% of trustees it questioned reported banking issues over the last year. “There are widespread problems in the way banks engage with their charity customers,” it said.
HSBC told me it was still reviewing your application despite the letter to you stating unequivocally it was unable to offer you banking facilities.
The review – prompted, it seems, by media scrutiny – took a further two months of repetitive questioning before it acknowledged that, given its 2021 investigations, it should have spared you a process reserved for new customers. It has agreed to provide an account, and has made a £200 donation.
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