Coutts bank’s decision to close Nigel Farage’s bank account must rank as one of the biggest PR own goals since Gerald Ratner dubbed his firm’s jewellery “total crap”.
The story unfolded when the former UKIP leader revealed that the bank had closed his account. He suggested this was because of his political views, which the bank denied.
As bankers to the royal family Coutts was traditionally renowned for its discretion. But on this occasion its traditional values fell by the wayside and it briefed a journalist at the BBC that Farage had fallen below the financial threshold it required. That’s £1m in investments or £3m in savings, in case you’re wondering.
But when Farage obtained the bank’s internal papers about him through a subject access request it settled the question … sort of.
Dossier
The 36 page dossier certainly did show that the bank disapproved of Farage’s links to Putin’s Russia and had a dim view of his political views.
It said: “The values NF actively and publicly promotes/champions, do not align with the bank’s. Particularly given the manner in which he states (and monetises) those views – deliberately using extreme, hatful[sp?] and emotive language (often with a dose of misinformation) – at best he is seen as xenophobic and pandering to racists, and at worst, he is seen as xenophobic and racist. He is considered by many to be a disingenuous grifter and is regularly (almost constantly) the subject of adverse media.”
But on the other hand the dossier also supported the bank’s contention that Farage’s account was to be terminated for commercial rather than political reasons.
“I wanted to make you aware of a commercial exit decision we have made on the account of Nigel Farage,” it noted, adding: “The relationship has been below commercial criteria for some time and upon review of Nigel’s past public profile and connections, the perceived risks for the future weighed against the benefit of retention the decision was taken to exit upon repayment of an existing mortgage.”
It went on ”the mortgage has now been repaid early and the security released which is triggering an earlier notification of exit to the client.”
Reputational damage
Yet despite the complexity of the bank’s motives for closing the account, it was the one that sustained the reputational damage from the affair. Not only was it leading news items but Westminster was taking an interest as well.
At Prime Minister’s Questions, the MP for North East Somerset, Jacob Rees Mogg, asked: “Does my right hon. Friend share my unease that a bank that has the Government as its largest shareholder should close the account of a senior opposition politician? Will he use the Government’s shareholding to ensure that there is an inquiry into those circumstances, because the subject data access request makes it clear, or certainly indicates, that it is the political views of the person concerned that led to his cancellation? Does my right hon. Friend agree that, however much we may find them tiresome, members of the opposition deserve bank accounts?”
The Prime Minister agreed with the thrust of his question and said it would not be right if financial services were being denied to anyone exercising their right to lawful free speech.
He went on: “Our new Financial Services and Markets Act 2023 puts in place new measures to ensure that politically exposed persons are being treated in an appropriate and proportionate manner, and having consulted on the payments services regulations, we are in the process of cracking down on that practice by tightening the rules around account closures. But in the meantime, any individual can complain to the Financial Ombudsman Service, which has the power to direct a bank to reopen their account.”
Matters took a further downward turn for Coutts when the Financial Conduct Authority (FCA) announced it would conduct a review to assess whether firms were being proportionate in their due-diligence of domestic Politically Exposed Persons (PEPs) in adhering to its guidance.
While noting that businesses factor in reputational risk when making commercial decisions, it pointed out that they must consider meet their obligations under the equality legislation.
An FCA spokesperson said: “While who banks do business with is ultimately a commercial decision for them, they should treat people fairly and ensure they meet their responsibilities under equality legislation.”
Wokery and irony
Thus was another irony – the possibility of the protection of equality legislation for a leading critic of wokery – added to a tale not short of ironies.
By yesterday the saga was moving to its dénouement. NatWest chief executive, Dame Alison Rose, issued an apology to Farage but declined to reinstate his Coutts account.
Where did Coutts, once a byword for impeccable and understated service, get its comms game so wrong?
It seems to have underestimated its one time customer turned adversary. On the other hand, Farage, a gifted political communicator, distilled his message into easily understood anxieties about the erosion of free speech rights and the removal of jobs, and in this case services, on political grounds. He reinforced his message with memorable phrases. He had been “debanked”, he declared.
But it wasn’t as though Coutts was unaware of Farage’s talent for inserting himself into the national spotlight. As its ill-fated dossier observed: “NF’s very public profile and propensity for self-promotion. A decision to exit may result in NF using his platform on GB News/social media to air his grievances (unless he was too proud or embarrassed to publicise it). Given the extent to which NF polarises public opinion. As NF moves on his next grievance/bigger issues.”
So what next? Well the story seems to be fading away for now at least. But mud sticks … as its former customer, Nigel Farage could tell them.
Coutts v Farage: anatomy of a PR disaster
Coutts bank’s decision to close Nigel Farage’s bank account must rank as one of the biggest PR own goals since Gerald Ratner dubbed his firm’s jewellery “total crap”.
The story unfolded when the former UKIP leader revealed that the bank had closed his account. He suggested this was because of his political views, which the bank denied.
As bankers to the royal family Coutts was traditionally renowned for its discretion. But on this occasion its traditional values fell by the wayside and it briefed a journalist at the BBC that Farage had fallen below the financial threshold it required. That’s £1m in investments or £3m in savings, in case you’re wondering.
But when Farage obtained the bank’s internal papers about him through a subject access request it settled the question … sort of.
Dossier
The 36 page dossier certainly did show that the bank disapproved of Farage’s links to Putin’s Russia and had a dim view of his political views.
It said: “The values NF actively and publicly promotes/champions, do not align with the bank’s. Particularly given the manner in which he states (and monetises) those views – deliberately using extreme, hatful[sp?] and emotive language (often with a dose of misinformation) – at best he is seen as xenophobic and pandering to racists, and at worst, he is seen as xenophobic and racist. He is considered by many to be a disingenuous grifter and is regularly (almost constantly) the subject of adverse media.”
But on the other hand the dossier also supported the bank’s contention that Farage’s account was to be terminated for commercial rather than political reasons.
“I wanted to make you aware of a commercial exit decision we have made on the account of Nigel Farage,” it noted, adding: “The relationship has been below commercial criteria for some time and upon review of Nigel’s past public profile and connections, the perceived risks for the future weighed against the benefit of retention the decision was taken to exit upon repayment of an existing mortgage.”
It went on ”the mortgage has now been repaid early and the security released which is triggering an earlier notification of exit to the client.”
Reputational damage
Yet despite the complexity of the bank’s motives for closing the account, it was the one that sustained the reputational damage from the affair. Not only was it leading news items but Westminster was taking an interest as well.
At Prime Minister’s Questions, the MP for North East Somerset, Jacob Rees Mogg, asked: “Does my right hon. Friend share my unease that a bank that has the Government as its largest shareholder should close the account of a senior opposition politician? Will he use the Government’s shareholding to ensure that there is an inquiry into those circumstances, because the subject data access request makes it clear, or certainly indicates, that it is the political views of the person concerned that led to his cancellation? Does my right hon. Friend agree that, however much we may find them tiresome, members of the opposition deserve bank accounts?”
The Prime Minister agreed with the thrust of his question and said it would not be right if financial services were being denied to anyone exercising their right to lawful free speech.
He went on: “Our new Financial Services and Markets Act 2023 puts in place new measures to ensure that politically exposed persons are being treated in an appropriate and proportionate manner, and having consulted on the payments services regulations, we are in the process of cracking down on that practice by tightening the rules around account closures. But in the meantime, any individual can complain to the Financial Ombudsman Service, which has the power to direct a bank to reopen their account.”
Matters took a further downward turn for Coutts when the Financial Conduct Authority (FCA) announced it would conduct a review to assess whether firms were being proportionate in their due-diligence of domestic Politically Exposed Persons (PEPs) in adhering to its guidance.
While noting that businesses factor in reputational risk when making commercial decisions, it pointed out that they must consider meet their obligations under the equality legislation.
An FCA spokesperson said: “While who banks do business with is ultimately a commercial decision for them, they should treat people fairly and ensure they meet their responsibilities under equality legislation.”
Wokery and irony
Thus was another irony – the possibility of the protection of equality legislation for a leading critic of wokery – added to a tale not short of ironies.
By yesterday the saga was moving to its dénouement. NatWest chief executive, Dame Alison Rose, issued an apology to Farage but declined to reinstate his Coutts account.
Where did Coutts, once a byword for impeccable and understated service, get its comms game so wrong?
It seems to have underestimated its one time customer turned adversary. On the other hand, Farage, a gifted political communicator, distilled his message into easily understood anxieties about the erosion of free speech rights and the removal of jobs, and in this case services, on political grounds. He reinforced his message with memorable phrases. He had been “debanked”, he declared.
But it wasn’t as though Coutts was unaware of Farage’s talent for inserting himself into the national spotlight. As its ill-fated dossier observed: “NF’s very public profile and propensity for self-promotion. A decision to exit may result in NF using his platform on GB News/social media to air his grievances (unless he was too proud or embarrassed to publicise it). Given the extent to which NF polarises public opinion. As NF moves on his next grievance/bigger issues.”
So what next? Well the story seems to be fading away for now at least. But mud sticks … as its former customer, Nigel Farage could tell them.
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Catherine Lafferty
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