Toby Young Toby Young

The Tories have failed us over debanking – again


On Saturday morning, when I was helping Caroline prepare for a lunch party, I got an urgent request for help from the leader of a populist, right-wing campaigning group. His organisation had just been debanked. He had five days before the account was closed, during which time the bank would return the money it had received in membership dues to the members and keep anything left over, effectively bankrupting the company. No reason was given, other than that it had breached the bank’s ‘community standards’.

‘That can’t be right,’ I told him. ‘Back in March, the government announced it was changing the rules to make it harder for banks to shut down accounts for political reasons. If the bank wants rid of you, it now has to give you 90 days’ notice and set out in detail why it’s closing your account. Disapproving of your political beliefs isn’t a permitted reason.’

After frantic Googling, I discovered ‘Farage’s Law’ had been torpedoed by the snap election

He sounded relieved, as well he might, and went off to compose a robust email to the bank’s CEO. Then I had a worrying thought. What if the government had never actually got round to changing the rules before parliament was dissolved last week? In March, the Treasury published a policy note in which it set out the draft statutory instrument (SI) that would amend the Payment Service Regulations 2017 to better protect customers from being debanked. All the government needed to do was lay this instrument before parliament and the changes would take effect.

But had it? I WhatsApped a former Treasury minister and he thought it must have been because it was ready to go when he was reshuffled last year. But after some frantic Googling, I drew the inescapable conclusion: these promised changes had been torpedoed by the snap election.

The amendment was colloquially known as ‘Farage’s Law’ because the government finally announced it after Nigel Farage kicked up an enormous stink about being debanked by Coutts last year. But some of the credit belongs to the Free Speech Union, the membership organisation I run, which lobbied the government to make these changes after our account was closed by PayPal in 2022. Indeed, I regarded it as one of our triumphs. Along with Farage, we had helped stop the emergence of a Chinese-style social credit system in Britain, whereby dissenters would be kept in line by threatening to withdraw essential services. Now it looked as if defeat had been snatched from the jaws of victory.

I told my friend the bad news and he was plunged back into despair. Then I remembered that someone I’d been at Oxford with was married to the former head of comms at the bank in question. Would he like me to reach out to him and ask to be put in touch with the current head of comms? Absolutely, he said. I ended up sending an email to that person saying I thought the account closure must be a mistake because the Treasury had made it clear what a dim view it takes of banks that shut down its customers’ accounts for political reasons. Might it be possible to check if someone in the back office had made an error before my friend went ballistic on Monday morning and enlisted the help of Nigel Farage to unleash hell against the bank?

While I was waiting for a response, I wondered what to do about the government’s terrible oversight. The best I could come up with was to launch a petition, urging all the major parties to promise to make the agreed changes to the regulations in their manifestos. Yes, this was something the Conservatives had said they’d do, but the proposals hadn’t been opposed by the Labour party and it’s not as if debanking only poses a threat to people with right-wing views.

I don’t suppose it will do any good. Reform and the Conservative party may include something about it in their manifestos, but Labour won’t and that will mean having to repeat the lobbying effort of the past two years. My only hope is that The Muslim Vote may add it to the list of demands it’s making as a condition of not standing candidates against Labour. Earlier this year, Abdulsami Arjumand of the Muslim Charities Forum said Islamic charities had been plagued by debanking for two decades. Some of The Muslim Vote’s demands – such as cutting all military ties with Israel – are unrealistic, but tightening up the rules around debanking is something Keir Starmer could easily agree to.

It’s clutching at straws, I know, but there was one bit of good news. My friend called me to say the bank had restored his account. Apparently, it had all been a dreadful mistake.

To sign the Free Speech Union's petition to stop debanking, click here