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

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

Last month, we reported on Barclays closing the bank account of a community gardening organization, leaving it unable to access funds in the account or make payments.

Since then, more cases have come to light in which community organizations have informed This is Money that their bank accounts have been closed or similarly restricted, some without warning or explanation.

Some of these organizations have banked with Barclays for over 40 years.

The Ogmore Valley Male Voice Choir is one such organisation, which discovered that its Barclays account was closed with immediate effect and without any explanation.

The choir, which performs free concerts for the south Wales community and raises money for local charities, had worked with Barclays without issue for 40 years.

That was until one afternoon in October, when the choir president received a phone call from Barclays informing him that each of his three accounts had been closed, just hours after he had deposited funds into one account.

Barclays was unable to provide any explanation as to why the account had been closed.

Choir chairman Peter Morgan said: ‘We have no idea why Barclays Bank has closed our accounts after we have been regular customers for so long.

“We have been left in limbo and that has put ourselves and I am sure many others in a difficult position.

‘We don’t borrow and we’ve always had credit, so why did it suddenly close?

“We give quite a bit to charities, as well as doing benefit concerts to benefit local organizations.”

In addition, the choir owns its own premises and has permanent orders for energy and insurance that regularly go out of account, which makes them fear that their supply will be cut off.

Many of its 45 choristers also pay their contributions by standing order.

A sour note: Barclays closed the bank account of the Ogmore Valley Male Voice Choir without notice or explanation

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

Morgan continued: ‘We are worried about our power being cut off because we don’t have access to 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 probably have about £30,000 in the accounts that we use to keep this building of ours running, and they say they can’t just transfer it. It has to be a completely new account.

‘We believe that because we are a charity and do not pay fees, this could be part of the reason we were suddenly closed. They have not said if there will be commissions for the new account.

Most organizations that contacted This is Money have low turnover, don’t borrow money, and don’t pay fees to maintain their accounts.

The problem they seem to face is that Barclays treats 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 toward the restoration of steam locomotives that are leased to historic railroads. He has worked with Barclays since 1990.

The organization’s Treasurer began receiving letters from Barclays telling him that they needed to speak to him about the ‘commercial details’ of Project 62 and threatening to close the account if he did not respond.

Bryan Stanley, secretary of Project 62, said: “Our treasurer spent several hours on the phone to the Barclays business banking team, explaining our business, but they seemed unable or unwilling to understand what I was telling them.”

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

Even after calling the correct department and providing all requested information, Project 62 continued to receive emails and letters threatening to close the account within 10 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, despite additional information being provided at Barclays’ request over the phone, which the agent who took the call said they said they were satisfied.

Mr Stanley said: ‘We don’t think we can believe a word Barclays says now. I wonder if Barclays is looking for an excuse to close our account.

‘We have never had a loan nor have we been overdrawn. Although there is currently only around £7,000 in the account, in the past it has been more than £30,000.

“We consider Barclays sending these emails to be harassment and mean we cannot believe anything their business banking team tells us.”

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 got in touch to report closed accounts.

A “good neighbors group” providing help to local residents told This is Money that Barclays had restricted their account after providing information that Barclays’ “know your customer” team had requested in a letter.

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

The secretary of a small parish council, who asked not to be named for fear that Barclays would restrict or even close his bank account, also told This is Money about the “bullying behaviour” he was experiencing from Barclays.

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

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

The employee said: ‘Part of the problem is that you just can’t talk to anyone. Unfortunately, Barclays has closed most of our nearest branches in recent years, leaving the nearest branch over 11 miles away.’

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

Barclays has since confirmed that the Ogmore Valley Male Voice Choir account will be reopened and that the other accounts will no longer face restrictions or be under threat of closure.

A Barclays spokesperson says: ‘As part of our ongoing responsibility to help prevent financial crime and meet our regulatory obligations, we must maintain up-to-date information on our customers’ trading accounts and this includes community groups.

‘We engage with our customers through a range of communications including postal mail, banners in our digitally active customers’ online and mobile banking, as well as SMS text message reminders and emails asking them to provide us with important information relating to your trading account.

‘These communications include account closure warnings. In cases where we do not receive a response with updated account information, we will proceed with the application of card blocks and account restrictions, followed by warnings about possible closure agreements if the issues remain unresolved.’