RBS's definition of a 'politically exposed person'

luke

Are you sure this is anything to do with them being state-owned.

Its a pretty serious allegation to make and its spreading around the web fast.

I would have thought its possible its just a mistake. Did it definitley start after they became state-owned and is there any evidence the two are connected?

Kevyn Bodman

'it is no surprise that it sends shivers down so many spines'

And yet a few hours ago you thought that many CoffeeHousers thought this line of questioning would be 'no big deal'.

We deserve your thanks and congratulations for putting you right on this, Fraser.

And you should buy youreslf a celebratory drink to mark the deeper undrstanding you have now.

TGF UKIP

Fraser, absolutely pointless expecting your useless mates, Dave Snooty and his Pals, to make anything of this, so can I urge you to put it into the wider public domain via your NoW column this week.

Anoneumouse

Fraser, Heads of State and their immediate family, Governments, official bodies controlled or closely related to Governments, and international organisations formed by Governments or official bodies, bank with BANK OF ENGLAND NOMINEES LIMITED? (Ltd company no: 1307478) who are exempt under Section 27(9) of the Companies Act 1976 from disclosing information on its clients.

So much for Gordons transparent and moral banking system eh

George Laird

Dear Fraser

I think the best thing for customers of RBS to do is close their accounts and move to another bank.

Since RBS is acting like a de facto member of the Labour Party and presumably the information will be channelled back to them via third parties, RBS cannot be trusted.

There maybe a sinister element to this and it is best not to take chances.

This Bank is morally insolvent.

I wonder, if you don't vote the "right" way could you be denied credit or a loan?

Yours sincerely

George Laird
The Campaign for Human Rights at Glasgow University

Kevyn Bodman

I might be out of the mainstream on these pages about whether or not it is central to the matter at hand that RBS is state-owned.

I think that is a happy coincidence for people like us because it gives added spice to the story.

I think the truly important point is the role of the FSA because that is where the mind-set and the ethos of asking intrusive questions to innocent members of the public is coming from.

I am prepared to believe that the specific question about political party membership was a mistake, and a mis-interpretation of the rules.
But that doesn't matter, because the concept of Polically Exposed Person comes from the FSA and mistaken application of that idea is foreseeable.

The Know Your Customer programme is still a flawed concept, and the FSA still bothers innocent people while failing to deal properly with those who deserve closer monitoring.

Privately owned firms comply with FSA regulations too.

The mis-application of regulations is worse than useless, it is damaging. It's probably inevtable too. And I suspect it is welcomed, or at least overlooked, in some areas of authority.

THX1138

Firstly I want to say I hate the database state & I'm a paid up member of no2id, but your wrong.

I applied for a new AMEX card online yesterday and they asked me these question.

In the last year, have you or a family member or close associate (including anyone with a close
business relationship, e.g. joint ownership of company, partnership, or anyone benefiting from any company/other entity you own) held the position of:*

* Head of state, minister, deputy or assistant minister?
* Member of Parliament?
* Member of Supreme Court, of a constitutional court or other high-level judicial body?
* Member of court of auditors or of the Board of the Central Bank?
* Ambassador, charges d'affaire or high-ranking officer in the armed forces?
* Member of the administrative, management or supervisory bodies of a state-owned enterprise?

Are you really trying to say that RBS would turn you down if you're a Tory? That is certainly the subliminal inference I took from the first post.

I don't want to tell you your job but your not some hack blogger but a respected political journalist be careful with your accusations.

I think you have over reached and now trying to make something out of nothing, remember you were talking to a call centre drone not anyone in authority.

Herbert Thornton

To me it sounds like a very clumsy attempt, almost certainly by the government, to identify people who hold what the government considers to be politically incorrect or otherwise undesirable opinions.

What other explanation makes sense?

Steve

Total garbage from RBS - I am an IFA and governed by the same rules and I can make a judgement if someone is a PEP without needing to ask anything about politics. It is another Brown slippery slope to a Stalinist state.

wight tory

So they are expecting somebody who has "fraudulent leanings" to give an honest answer to something that maybe used against them?

You couldn't make it up.

Chuck Unsworth

There's far too much of this sort of intrusion and snooping by the State and its proxies. It's merely the thin end of the wedge. Just don't bank with RBS, simple as that.

I Robert

Dear Fraser

I think the best thing for customers of RBS to do is close their accounts and move to another bank.

Since RBS is acting like a de facto member of the Labour Party and presumably the information will be channelled back to them via third parties, RBS cannot be trusted."

Totally agree George-To all you morris dancers dahn saath, take it from us that up here, the banks are now CONTROLLED TOTALLY by the liebour party, and WHO IN THEIR RIGHT MIND believe anything that comes out of their mouths any more?

Andrew K

"...as part of the FSA guidelines around Anti Money-Laundering...". They certaully have the authentic NuLab syntax off pat already.

Cath

TBH Fraser I think this whole thing says less about state intrusion into our political allegiance than it does about how RBS went bust in the first place. Total shower.

CCTV

THX1138 is nearer the truth I feel. I have answered similar qestions from a US bank, and they were so clearly drawn up by lawyers that it was clear what the intent was - to avoid subpoenas.

The way we are led to believe RBS is operating is very different; on the other hand i have recently opened an account with RBS and faced NO such questions.

I frankly think this is a case of mismanaged call-centre staff - just as the current disaster with Halifax subjecting people to telephone harassment supposedly to help them cope with the credit crunch is backfiring.

Banks are crass and have had a very easy ride; they are incompetent at their own business and if we had real industrialists they should subject the banks to a bit of slimming down and restructuring to return to core business - such as knowing their customers personally and not remotely

alex r

I work in asset management and have had to receive training on money laundering, which includes politically exposed persons. Think this is coincidental.

Sean

Doesn't the BoE hand over a list of PEP's to the major banks? They just compare your name to a spreadsheet. Political involvement does not constitute a PEP.

Tiberius

Hands up anyone who tried to open a business chargecard facility or similar with RBS before it was taken into public ownership, and who wasn't asked whether they were a PEP.

Anoneumouse

Did the UK government use the anti terrorism laws to freeze Icelandic banks assets because of the potential losses of the shareholders of BANK OF ENGLAND NOMINEES LIMITED?

We need to know.

IdlingAway

THX1138, CCTV and alex r are on the right lines here. I too have had some anti-money laundering training and this is a standard part of the process that bankers, lawyers & accountants have to go through if they are in a position to receive & transfer money on their clients' behalf.

In theory, you have to prove that you "Know Your Customer" and you have to be aware that you are not handling money that could be derived from your political position/contacts (i.e. that you are not laundering money that comes from political corruption).

This is fine in theory but when you get lawyers drafting the questions and account-opening procedures being handled by admin or call-centre staff it becomes a series of mindless form-filling questions (rather like the questions on the back of the US visa-waiver forms you fill out at Heathrow about whether you've ever been convicted of war-crimes or something like that).

Asking everybody this question therefore provides banks, lawyers & accountants with a fig-leaf of legal protection whilst achieving absolutely nothing.

So, sorry, your political conspiracy theories will have to go back in the box on this occasion.

Go after Brown for destroying LloydsTSB - as Iain Martin said in today's Telegraph. This is a scandal that everybody seems to be just shrugging their shoulders about.

Tim Carpenter LPUK

Let us say this was a cock up. Now consider that the staff, their supervisors and up the chain were however quite happy to ask or see the questions asked and parrot the "its the regs, guv" or the dreaded "procedure".

It reminds me of those experiments where people were asked to give a hidden subject electric shocks, and they went right on and did it.

I wonder how many people in the chain said that no way were they going to comply with asking such questions.

A bank employee

Fraser,

Employees of banks are required by statute to undergo training in Anti-Money Laundering and Data Protection on a regular basis.

There is no connection between the concept of a "Politically Exposed Person" in AML terms and political affiliation. This is absolutely basic and it is inconceivable that RBS and the FSA do not know this.

Furthermore, under Data Protection legislation political affiliation and beliefs are regarded as sensitive personal information. The DPA is based on very firm principles, one of which is that data collected must not be excessive and must be relevant to the business need. For example, it is relevant to ask a customer about their salary in a loan application, but not in an application for a savings account. Under no circumstances is political affiliation relevant.

RBS is in clear breach of Data Protection law. If the FSA is demanding the question is asked, so is the FSA.

TrevorsDen

Oh dear - UKIP uses yet another serious post to propagandise against 'Dave Snooty' etc.

Anyway next time I get that email from the bloke in Nigeria I will know what questions to ask him.

Meantime - this episode has shone a light on crass incompetence in RBS and possibly elsewhere. And we should not forget that supposed concerns about money laundering can be used to keep tabs on all of us.

Fred Kite

Barclays shut down BNP accounts after a BBC documentary a few years back.
More here
http://www.independent.co.uk/news/uk/politics/barclays-bank-shuts-down-bnp-accounts-553495.html

Ronnie

I remember the good old days when people were described as 'interested in politics' or 'politically active'. I wonder what it is to 'exposed' to politics as one might be to a deadly air-born virus?

Are we to be so sanitised now that any contact or engagement with 'politics' is to be regarded as a risk by financial institutions?

Perhaps this was a cock-up but it came from a rather odd mind-set.

Publius

Furthermore, as I think TrevorsDen has mentioned elsewhere, this kind of lights-on-nobody-home robotic box-ticking behaviour from bank employees is a key reason they are in the mess they are currently in.

I daresay I'm not the only one who remembers when banks had proper branches and proper managers, who had discretion and were able to apply common sense.

The wider question is the ever-extending abandonment of good character and good judgement in favour of systems and regulations. We have systems now so vast and unwieldy that no one understands them any longer, and so merely obeys what the computer screen tells them.

Jamie Cooke

The AML legislation requires that regulated sector firms adopt a risk based approach under the new Money Laundering Regulations 2007. If a customer presents a higher risk (such as a PEP) then the regulated firm, in this case RBS, must carry out enhanced due diligence.

From the details of the case however it would appear that RBS are trying to identify domestic PEPS whenever they are only obliged to identify foreign PEPS. From my experience this shows a lack of AML training or/and a failure to understand their training. Both of which are breaches of the ML Regs 2007.

As someone said in their blog the presecriptive tick box approach, which the ML Regs 2003 was based on has been abandoned. By the way there are no lists for PEPS but there is software which will check someones identity and highlight if they are PEPS.

Jack Eddie

The PEP list is a cover for more clandestine purposes,any individual who has crossed swords with civil servants or their like have been put on the PEP lists. These individuals don't know that they have been disadvantaged in their business and social life. Only after a series absurd events do they realise that all is not well, the Pep Quango have its "restrictions" executed by proxy, very convenient is'nt it and is a summary life sentence, no appeal,no redress. I would be interested in anyone else's experiences with "authority".