Business bank account closed 5 days notice

Lucy4510

Hello  - please please help, feeling completely out of control and lost on what to do. The situation is as follows 
We have our own limited company, we were told by the bank we had 5 days to move eveyrthing as closing the account and under FSA guidelines they do not need to give a reason! 
For clarity the business account is very neat/making a profit/no late payments/no overdraft or loans against the business we basically just use it to pay employees, bills and receive money from customers. 
Next step we went to our local bank we bank with personally to apply for a business account, based on all the info we gave they saw no issues however then when the underwriters did their checks something came up which again they couldn't tell us what but advised us to do an experian check on our personal accounts and business which we did and even got a financial advisor to look at and nothing came up as any issues at all, all nice and tidy. The bank also suggested we contact a company called CIFAS and put in a data subject request which we have done they should get back to us in two days with an update and there is no number to call. 
So the issue is - the business account is closing, we can't get a business account with our bank, there is something on our file that we have no idea what it is or how to resolve it until this information comes back. 
We still need to operate as a business we have suppliers to pay, HMRC tax bill to pay, employees to pay, money coming in from customers and our own wage which we need to pay the mortgage with - but how are we going to be able to do this without having a bank account - any advice would be soooo very much appreciated this is not only causing us financial pressure but mentally this is just getting too much, feeling overwhelmed and just want to know how to fix it but nobody will tell us why this has happened.... or what we need to do to resolve it 

born_again

You need to open a new account quick & hope that does not get shut down as well.

Banks will not tell you the reason why. Called "Tipping off" & can get staff member sacked & face 5 years in jail, as well as massive fines for the bank.

You will just have to wait & see what CIFAS have logged. But clearly there is something in either someone's past actions or some of the source of funds in not what it seems.

tacpot12

I've sorry to hear you are having this trouble. Clearly, something is recorded somewhere about your business that is causing the bank's anti-money laundering checks to recommend refusing to open an account for the business. The response from CIFAS may confirm what this is.

There is not much else that will do this. If you have a customer or director who is on the UN's list of sanctioned individuals or is a Politically Exposed Person, you might also have this problem. If there have been payments to or from gambling organisations, this might trigger a record somewhere.  

The nature of the services you company offers might also be a problem. A change the law or a change in risk appetite might cause a company who was previously acceptable to become unacceptable. 

I think I would try opening a business with another bank and see if you can glean any more information from them, assuming they too will not open a business bank account. I would try one on the high street.  

As an alternative, you could also try a challenger bank (see this list The UK's Top Challenger Banks 2024 - Business Expert) in the hope that their AML checks are not so well developed as your current bank. If you are successful opening an account, I think you need to continue to review the response from CIFAS in case it is just a matter of time before that account is also closed down. 

Brie

CIFAs reports some information on credit histories. Bit of a long shot but you might want to check yours out.  

tacpot12

I think I would also write to your MP. I think that there is a need for a form of bank account that cannot be closed down because of AML checks. Not having a bank account is such a significant problem in modern day life that there needs to be a backstop where you can have a bank account but it is heavily supervised. No retail bank would want to take on this workload, so a publically-owned retail bank would appear to be the answer. 

Nasqueron

tacpot12 said:

I think I would also write to your MP. I think that there is a need for a form of bank account that cannot be closed down because of AML checks. Not having a bank account is such a significant problem in modern day life that there needs to be a backstop where you can have a bank account but it is heavily supervised. No retail bank would want to take on this workload, so a publically-owned retail bank would appear to be the answer. 

What bank (other than a government run bank of last resort) would want the risk of being forced to keep open accounts for people who fail AML checks?

Hoenir

tacpot12 said:

I think I would also write to your MP. 

The priority is to ascertain what the issue is.