From 1st January 2018, banks and building societies will have a legal duty to ensure those with an illegal immigration status cannot open a current account.
The Immigration Act 2016 adds further measures to deter illegal migrants from using current accounts. As a result, banks have the obligation of contacting the Home Office if they become aware of a client having illegal status.
The purpose of these measures is to ensure illegal migrants are significantly less likely to establish residence in the UK but also at the same time to encourage illegal migrants to leave the UK on their own.
The provisions of the Immigration Act 2016, requires banks and building societies to consistently review the immigration status of their clients with current accounts. This also includes a requirement for checks to be performed for all current accounts prior the introduction of the 2014 Act. Furthermore, banks and building societies must communicate with the relevant anti-fraud agencies with the purpose of implementation of such checks. The costs of carrying out these checks are incurred by the banks themselves.
The next round of these checks will begin on 1st January 2018 which is conducted during the subsequent quarter of each year.
During these checks, if an illegal account holder comes to light then owners of the account will be reported to the Home Office and subsequent further action will be taken against the illegal migrants that are in with Home Office procedures.
To ensure the current account holder is certainly in the UK illegally, the Home Office will also carry out they own checks. Once, this has been confirmed, the Home Office will have authority to:
- require the bank or building society to close the account as soon as reasonably practicable; or
- apply to the courts for a freezing order in respect of one or more of the accounts operated by the confirmed illegal migrant.
fraud In most cases, the first option will be approached with the intention of damaging the illegal current account holder’s capacity to stay in the UK and to push them to leave the UK. However, the use of the second point aims to deal with more difficult cases which require authorities to apply more pressure.
The Financial Conduct Authority will oversee that these checks are carried out properly and that banks take all necessary steps to check immigration status of their clients. On the other hand, the Home Office has received worrying concerns that their record keeping is not completely accurate and this will unfairly affect legal migrants in error.
At Mann’s Solutions, we provide advice to clients that may be affected by checks and we aim to update banks of their Immigration status. We encourage our clients to update their private bank of their original passport, biometric residence permit or visa should any changes occur to their visa status. We can also provide advice or legal opinion to our clients if they have concerns about how their legal status may be interpreted.