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Natwest ordered to disclose suspicious activity reports made to National Crime Agency25th October 2018 Business Crime
It has been published this week that Natwest have lost a court ruling which forced them to disclose suspicious activity reports made to the National Crime Agency regarding an individual’s bank account.
Under the Money Laundering, Terrorist Financing and Transfer of Funds (Information on the Payer) Regulations 2017, banks and other organisations must report suspicious activity to the National Crime Agency.
The London based barrister whose accounts were in question had a total of seven accounts with the bank, including personal and joint accounts. In March 2017, Natwest froze one of his joint accounts for a total of eight days while they made a suspicious activity report to the National Crime Agency. In December 2017, all his accounts were frozen while making more serious activity reports.
The bank advised that they would be closing his accounts and soon after he issued proceedings for breach of contract, breach of the Data Protection Act 1998 and defamation. As part of the proceedings, he made an application to the court requesting access to the serious activity reports which Natwest contested.
The succeeded in the High Court before Karen Steyn QC. Ms Steyn QC ruled that the serious activity reports were relevant to the civil proceedings as to whether the bank’s employees had a relevant genuine suspicion, especially as no previous explanation had been provided by the bank as to what gave rise to a suspicion of money laundering. It was further noted by Ms Steyn QC that none of the evidence before her suggested that the serious activity reports are currently required to be kept confidential.
Natwest argued that an order requiring the bank to hand over the report may force them to commit the offence of tipping off under Proceeds of Crime Act 2002. This Act makes it an offence to make a disclosure to a suspected person that a suspicious activity report has been made about them and also make a disclosure where it is likely to prejudice a money laundering investigation being undertaken. Ms Steyn QC again confirmed that this concern was unsupported by any of the evidence.
Although the serious activity reports were eventually disclosed, their content remains confidential as the terms of the settlement stipulated that the content could not be discussed.