A wave of compliance checks by Santander has left stores facing frozen accounts, missed direct debits and being cut off by wholesalers and in-store services.
In November and December 2023, the bank sent anti-money-laundering checks to store owners, requesting documents including tax records, wills, business accounts, proof of ownership, supplier contracts and shop leases. Santander warned “accounts will be restricted” if they failed to comply.
Sanjay Patel, owner of Niqisha Enterprises in Cardiff, faced a similar issue in 2021, resulting in the bank blocking direct debit payments. After sending the agreed files, he considered it resolved until it re-emerged late last year. “They know the impact of this on retailers and they don’t care,” he said.
Despite filing the documents by the deadline, Craig Etchells, owner of C & W Etchells in Manchester, later received another demand for documents. When challenged, the bank said “any restrictions will be lifted tonight”.
Temporary account restrictions
Four further Fed members reported similar problems. Santander told Better Retailing the checks were for its “legal and regulatory obligations”. It added: “When the customer does not respond, we may temporarily restrict their account.”
Last year, Better Retailing reported more than 20 instances of retailers having their accounts frozen between December 2022 and January 2023. Store owners claimed they had received calls from Santander, NatWest and Barclaycard threatening to freeze their accounts if they didn’t update their personal information online at short notice.
It coincided with the Financial Conduct Authority introducing new guidance for banks to carry out additional money-laundering checks, which was thought to be behind the wave of threats and freezes at the time.
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