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| Mo Farah |
Barclays bank
is under growing pressure to reverse a “kneejerk” decision to pull the
plug on UK companies that allow people to send money home to support
families in some of the world’s most desperately poor countries.
Olympic and world champion runner Mo Farah has thrown his weight behind a campaign to
stop the bank closing the accounts of 250 UK money-transfer companies
operating what Farah called a “lifeline” into poor countries.
Farah’s native Somalia has no regulated banking system and gets 50% of its income through remittances.
Last week Farah wrote to the PM and this weekend added his name to a
petition calling on the bank to extend its deadline of 12 August, asking
his 800,000 Twitter followers to do the same.
“The
Mo Farah Foundation, along with some of the world’s biggest charities
and organisations, including the UN, relies on these businesses to
channel funds and pay local staff,” he said. “This decision could mean
life or death to millions of Somalis.”
On
Wednesday, a delegation led by shadow international development
minister Rushanara Ali will deliver the petition to Downing Street,
asking David Cameron to intervene. The prime minister hosted a major
conference on Somalia in May when he said failure to support the country
would increase the global terror threat. A diplomatic storm is also
gathering, with Pakistan, Bangladesh, Ghana and other states expressing
concern.
Barclays
is the major player operating in the £2bn sector, which supports some
3,500 British jobs. But the UK and US governments have been tightening
bank regulation. US authorities fined MoneyGram $100m andslapped a $1.9bn fine on HSBC last year over poor money-laundering controls.
Ali, MP for Bethnal Green and Bow, said: “Countries across Africa and
Asia will be badly affected and none more so than Somalia, a population
reliant on what their friends and families send. Barclays’s decision
will indeed cost lives – quite apart from potentially triggering a new
crisis in the region.
“Shutting
this vital lifeline risks giving people no other choice but to send
money through dangerous and alternative methods out of desperation.
“We’ve
not heard a whisper from the foreign secretary on this issue. He ought
to step in. Barclays’s decision risks undoing the fragile progress that
has been made after decades of conflict, not to mention humanitarian
emergencies, piracy and terrorism,” said Ali.
Oxfam
is also pressing the government to act. “It seems an extraordinary move
of risk aversion by the bank. A rather kneejerk reaction when we are
talking about people sending small amounts, usually £200 to £300 at a
time,” said Emma Fanning, its humanitarian and conflict policy adviser.
“Vital to the people receiving it but very unlikely to be the kind of
funds that terror organisations would be dealing in.
“The
impact of this will be felt by ordinary people, families and
communities who are already in poverty and are now finding an essential
lifeline being cut off. There will be suffering as a result. Not only
that but aid agencies and charities will be left to plug that gap when
people in countries like Somalia are cut off from financial support
coming from families abroad.
If
the bank isn’t willing to find a solution then the government has to
come up with one. They have to find a way round this and quickly.”
Barclays
said it would give extra time to money transfer companies who asked.
“As a global bank, we must comply with the rules and regulations in all
the jurisdictions in which we operate. The risk of financial crime is an
important regulatory concern and we take our responsibilities in
relation to this very seriously.
“Some
money-service businesses don’t have the necessary checks in place to
spot criminal activity with the degree of confidence required by the
regulatory environment under which Barclays operates. Abuse of their
services can have significant negative consequences for society and for
us as their bank. We remain happy to serve companies who, in our
opinion, have sufficiently strong anti-financial crime controls and who
meet our amended eligibility criteria.
“We have been engaging with the UK Government, remittance industry bodies and other stakeholders to discuss the issues.”
A
government spokesman said: “The Government is committed to supporting a
healthy and legitimate remittance sector, allowing UK residents to
remit funds abroad whilst also ensuring a robust anti-money laundering
regime.
“Ministers
have met industry to discuss the issues facing the sector. The
Department for International Development is also urgently reviewing the
impact of changes on developing countries and examining what can be done
to support those affected.”
Source: The Guaridan
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