Guidance for banks and building societies on carrying out immigration checks on current account holders: Immigration Act 2014 (accessible)
Updated 3 May 2024
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This publication is available at https://www.gov.uk/government/publications/immigration-status-checks-guidance-for-banks/guidance-for-banks-and-building-societies-on-carrying-out-immigration-checks-on-current-account-holders-immigration-act-2014-accessible
Version 3
About this guidance
This guidance assists banks and building societies to comply with statutory requirements under sections 40, 40A, 40B and 40G of the Immigration Act 2014 (as amended by the Immigration Act 2016).
Banks and building societies (‘firms’) are prohibited from opening or operating current accounts for persons who are disqualified from accessing those services due to their immigration status. To find out whether individuals are disqualified, firms must check their customers’ details against data on known unlawful migrants. The data is supplied to firms by the Home Office, via a specified anti-fraud organisation.
For information on a range of immigration documents that firms may encounter please see Guidance on examining identity documents - GOV.UK (www.gov.uk) and Biometric residence documents: information for financial providers guidance (publishing.service.gov.uk)
The Home Office is moving away from the reliance on physical documents in respect of immigration control. Migrants are instead transitioning to prove their immigration status through digital means – an eVisa. They will rely upon the use of an online account and a ‘share code’ that allows third parties to undertake an online check of their immigration status through the View and Prove service.
View and prove your immigration status: get a share code - GOV.UK (www.gov.uk)
Using your UK Visas and Immigration account - GOV.UK (www.gov.uk)
Publication
Below is information on when this version of the guidance was published:
- version 3
- published on 3 May 2024
Changes from last version of this guidance
The formatting of this guidance has been updated for consistency with comparable documents published by the Home Office.
- update changes in the digital checking process
- clarification added to who is a disqualified person
- inclusion of legislation wording in current account application checks section Page 4 of 15 Published on 03 May 2024
- changes to how banks and building societies should make the checks section
- section on onboarding, including variations to signatories and beneficiaries added
- changes to existing current account match section
- section on excluded accounts (periodic checks) added
- changes to section on existing current accounts and regular periodic checks
- changes to closure of accounts section
- section on what to do if there is a service outage added
- section on regular payments and reports to the Home Office added
- changes to if the bank or building society believes there is an error section
- section on where the Home Office rescinds the notification that a firm is under a duty to close an account added
- amending contact details to get in touch with the Home Office
Related external links
Immigration Act 2014 (legislation.gov.uk)
The Immigration Act 2014 (Current Accounts) (Compliance &c) Regulations 2016 (legislation.gov.uk)
The Immigration Act 2014 (Bank Accounts) Regulations 2014 (legislation.gov.uk)
The Immigration Act 2014 (Bank Accounts) (Amendment) Order 2014 (legislation.gov.uk)
Immigration Act 2014: suspicious activity reporting - GOV.UK (www.gov.uk) - interim guidance published on 30 March 2023
View and prove your immigration status: get a share code - GOV.UK (www.gov.uk)
Using your UK Visas and Immigration account - GOV.UK (www.gov.uk)
Who is a disqualified person?
A person is disqualified from opening or operating a current account in the UK if the following all apply:
- they are in the UK
- they require immigration permission to be in the UK, but do not have it
- the Secretary of State considers that they should be disqualified from opening or operating a current account
How banks and building societies should make the checks
The Home Office provides data to a specified anti-fraud organisation on persons disqualified from opening or operating current accounts. Firms must check prospective and existing current account holders, signatories, or beneficiaries against these data. This will enable them to establish whether, an individual is permitted to open or operate a current account. The details of the specified anti-fraud organisation, or specified data-matching authority involved in sharing these data are set in secondary legislation.
Firms must conduct regular periodic checks on all existing current accounts in compliance with regulations made by HM Treasury. There must be at least one check conducted on all existing current accounts per quarter.
Firms should adhere to the process of screening new and existing current accounts against the circulated data. There are leaflets and a redress process in place for individuals affected by these measures with advice on how to contact the Home Office. The Home Office will then undertake any further necessary enquiries where a customer believes that they are not a disqualified person.
Current account application checks
New account applications (onboarding)
Section 40 of the Immigration Act 2014 requires firms to ensure they do not open a new current account for a disqualified person.
40 Prohibition on opening current accounts for disqualified persons
(1) A bank or building society (B) must not open a current account for a person (P) who is within subsection (2) unless—
(a) B has carried out a status check which indicates that P is not a disqualified person, or
(b) at the time when the account is opened B is unable, because of circumstances that cannot reasonably be regarded as within its control, to carry out a status check in relation to P.
Section 40(1) refers to a ‘current account’. This term is not defined in the legislation in respect of the opening of new current accounts.
The restrictions on access to these accounts relates to all applications to open a current account, including where a disqualified person is seeking to be a joint account holder, a signatory or beneficiary, and includes applications to add a disqualified person to an (existing) current account as a holder, signatory, or beneficiary.
To meet their duties under section 40 of the Immigration Act 2014, firms must check all applications for new current accounts from all adults (aged 18 or over). This includes current account applications in relation to which the customer is a signatory or is identified as a beneficiary. It also includes adding an individual as an account holder, signatory or identified beneficiary to an existing current account.
Onboarding, including variations to signatories and beneficiaries - meaning of banking customer
The prohibition on opening current accounts applies only in respect of ‘consumers’ (an individual who, with respect to an account to be or being operated by or for them, is acting for purposes other than a trade, business or profession); charities with an annual income of less than £1m per annum; and micro enterprises, which includes the self-employed, businesses with less than ten employees, and has either or both an annual turnover or annual balance sheet does not exceed €2 million.
These categories are consistent with the current definition of a ‘banking customer’ already in common usage in the sector and set out in the Financial Conduct Authority’s (FCA) existing Banking Conduct of Business Sourcebook.
All other accounts are excluded from these checks.
New current account application match
A person is considered to have been matched under the provisions of section 40 of the Immigration Act 2014 if there is at least a three-point match against the Home Office data on disqualified persons.
If checks of an applicant by a firm against the Home Office data result in a positive match, the firm must refuse to open a current account for that individual. Where there is an application for a joint account with a non-disqualified person, the firm must refuse to open a joint account but can open a sole account for the non-disqualified person, in line with their usual processes.
The firms must tell the disqualified person of the reason for refusal as set out in the Home Office leaflet: current account refused. The only exceptions are in cases where the firm is subject to other lawful impediments.
Existing current accounts and regular periodic checks
Section 40A of the Immigration Act 2014 requires firms to check existing current accounts to identify any that may be held by disqualified persons.
To fulfil their duties under section 40A of the Immigration Act 2014, firms must check current accounts against the list of disqualified persons from the Home Office. The checks are to be made in respect of all account holders, signatories and known beneficiaries of these accounts. Firms should also note that certain accounts are excluded from these provisions (see Excluded Accounts.
Section 40H(2) of the Immigration Act 2014 stipulates that the term ‘account’ in sections 40A-40G (checks on existing accounts) “includes a financial product by means of which a payment may be made”. This definition also applies to the associated secondary legislation and at Article 3 of The Immigration Act 2014 (Current Accounts) (Excluded Accounts and Notification Requirements) Regulations 2016, this requires firms to provide details of any such accounts held by a disqualified person, accounts that they are a signatory and beneficiary to, and to provide details as required on a Notifications template.
Where, a firm identifies a match, it should report any such accounts to the Home Office. The Immigration Act 2014 (Current Accounts) (Excluded Accounts and Notification Requirements) Regulations 2016 (legislation.gov.uk) sets out the information that should be reported at Regulation 3. This regulation also allows a firm to share any other information that it believes may be relevant to the Home Office’s role in restricting disqualified persons’ access to these accounts.
Existing current account match
A person is considered to have been matched under the provisions of section 40A of the Immigration Act 2014 if there is at least a three-point exact match against the Home Office data on disqualified persons.
If checks against an existing current account holder by a firm result in a positive match, then they must notify the Home Office by downloading and completing the ‘Notifications’ file. Firms should refer to the explanatory notes contained within the Notifications file for more information on the details to be included. Firms should not re-report a disqualified person where the account number is the same as in a previous return, and the firm has already been advised to close that account. However, where an alternative or new account is identified, firms must report this match.
If an individual is identified as being disqualified where they are acting under a power of attorney, the firm must still report the match to the Home Office. There is no need to close down the account if the account holder is not a disqualified person (and the disqualified person acting under power of attorney is a signatory or beneficiary) as the duty to close can be satisfied by restricting the access of the disqualified person to the account.
If checks by a firm do not identify any matches, then there is no requirement to notify the Home Office of this.
Excluded accounts (periodic checks)
Section 40A(1) states:
A bank or building society must, at such times or with such frequency as is specified in regulations made by the Treasury, carry out an immigration check in relation to each current account held with it that is not an excluded account.
Section 40A(4) provides that, an existing account is excluded from periodic immigration checks in relation to current accounts where HM Treasury has defined this in regulations.
The regulations, The Immigration Act 2014 (Current Accounts) (Excluded Accounts and Notification Requirements) Regulations 2016 (legislation.gov.uk) serve to exclude accounts operated by or for an individual who is acting, with respect to the account, for the purposes of a trade, business or profession from the periodic checks.
Lord Young of Cookham described the way the government proposed the measures should work during the House of Lords debate on the Immigration Act 2014 (Current Accounts) (Excluded Accounts and Notification Requirements) Regulations 2016, on 12 December 2016. This can be found at the following link at the end of column 15 and beginning of column 16: Immigration Act 2014 (Current Accounts) (Excluded Acco - Hansard - UK Parliament. Within the debate Lord Young confirmed that personal current accounts, including basic bank accounts, are in scope of the measures under the Immigration Act 2016 and not extended to include corporate or business accounts.
“Such an account would be expected to provide functionality to hold deposits and make withdrawals without having to give notice. It would also typically enable the customer to receive and make payments through a number of different methods, including by cheque, direct debit, standing order, continuous payment authority or other electronic payments. Withdrawals, money transfers and other payment transactions can typically be conducted through various channels including ATMs, branch, online, mobile or telephone banking. Many current accounts also have overdraft facilities.”
Home Office instructions in respect of matches against existing accounts
In order to confirm any match, the Home Office must undertake a secondary check of its records to ensure the individual concerned remains disqualified at the date of notification. The Home Office will then provide advice and instructions to firms in respect of all matches reported by means of a ‘Responses’ file on the secure Home Office IT portal. This will range from;
- that the bank should take ‘No Further Action’ on the match
- that no further action is required until or unless further instructions follow from the Home Office, or
- a notification that the duty to close accounts applies
Regular payments and reports to the Home Office
The Immigration Act 2014 (Current Accounts) (Excluded Accounts and Notification Requirements) Regulations 2016 (legislation.gov.uk)) provides for the notification that a firm must provide having undertaken a check on existing accounts.
Where, in the year before the immigration check in relation to an account within sub-paragraph (d)(i) or (ii) was carried out, at least two payments of £200 or more were (as far as appears in B’s (bank or building society) records) made into the account by the same person or from the same account.
The term ‘regular’ means firms must report payments into the accounts that appear related and have happened at least twice within the preceding 12 months. There must be a monetary value of at least £200 per transfer when looking for these ‘regular’ transactions, within any account in scope of the measures. The 12-month period ends on the date the firm conducts its check.
The regulations above do not specify who the payments must be from. Therefore, firms must include all payments which occur two or more times, of £200 or more from the same person, or same account, made into the current account. This could include the disqualified person themselves.
Finally, firms should include all payments which meet the criteria within their notifications, both domestic and international.
Freezing orders
The Home Office will take a number of factors into consideration when deciding whether a freezing order is required. A code of practice (available here) sets out how these deliberations are to be made in respect of:
- whether to apply for a freezing order
- the variation or discharge of a freezing order
This code of practice also explains how a freezing order will be kept under review.
If a court makes a freezing order in respect of any account, the firm must prohibit any person or body by or for whom the account is operated from making withdrawals or payments from the account in accordance with the order. This will apply until the freezing order is discharged.
A freezing order may make provision for the disqualified person to meet his or her reasonable living or legal expenses. It may allow an individual who is not disqualified to make withdrawals or payments from the account. These accommodations, where applicable, will be set out in the order.
Closure of accounts
If the Home Office notifies a firm of its duty to close an account via the Responses file on the secure Home Office IT portal, as stated in the Immigration Act 2014 (legislation.gov.uk) at section 40G(2), the firm must do so as soon as reasonably practicable. Any immigration application or appeal submitted after receipt of the duty to close notification, will not affect the status of this notification.
HM Treasury (HMT) has published a policy paper and draft Statutory Instrument on the Payment Services (Contract Terminations Amendment) Regulations 2024.
If any account is closed, a firm can return any credit balance to the account holder in line with its terms and conditions, unless the account is under separate investigation or law enforcement action.
The firm may delay closure for a reasonable period to manage debt and the interests of third parties. The firm can also comply with its statutory duties if it takes steps to prevent the account from being operated by the disqualified person, such as where steps are taken to restrict access where the disqualified person is a signatory or identified beneficiary, or the account is jointly held with a non-disqualified person, instead of closing the account.
The firm must tell the customer of the reason for the account closure or prevention of its operation, if it can do so lawfully, as set out in the Home Office leaflet: current account closed.
In compliance with section 40G, the firms must tell each person or body by or for whom the account is operated, if it may lawfully do so, why it has closed the account or prevented the account from being operated by or for the disqualified person. However, firms should not disclose the fact that a person has an irregular immigration status to any third party. Firms could tell other parties to the joint account that they can no longer provide a current account to the disqualified person, due to legislative or regulatory requirements.
Following notification from the Home Office that it is subject to a statutory duty to close an account, firms must provide information to the Home Office when they have complied with that duty. This information must:
1. Be provided before the end of the financial quarter in which the account was closed (with the exception that information about steps taken in the last two weeks of a quarter may be provided in the next quarter).
2. Be provided by uploading an [Actions] file to the secure Home Office IT portal.
3. Include the name of the bank or building society providing the information, and the date upon which the information is provided.
What to do if an application for a current account is declined or an existing account is closed
If an application for a new account is refused or an existing account closed, the Immigration Act 2014 requires that an individual must be informed of the reason why. This is provided that informing the individual does not conflict with banks’ or building societies’ obligations under other legislation (such as the Proceeds of Crime Act 2002). Whether this will conflict with other obligations should be decided by the firms on a case-by-case basis. In most cases, the individual will be aware that they are liable to or already subject to immigration enforcement action by the Home Office.
The Home Office has prepared leaflets which should be given to customers whose applications have been refused or whose accounts have been closed. Separate leaflets have been prepared for each eventuality, and they explain the reasons why action is being taken. The firm may choose to use these leaflets as separate documents, or they may incorporate the wording within their own letters but, the text provided should not be altered. The leaflets inform customers that they should take the matter up with the Home Office if they believe a mistake has been made and they are entitled to open or operate a current account and includes details of how they can make contact.
If the bank or building society believes there is an error
Should a customer provide compelling evidence that they are lawfully in the UK, the firm should refer them to the contact details for the Home Office as provided on the leaflets for customers. If the customer is no longer considered to be a disqualified person, the Home Office will amend its data and restrictions will no longer apply. The customer may then reapply for a current account and will be subject to the firm’s usual criteria.
Firms may use the Immigration Act 2014 Banking Measures checking service if required for new account applications. This course of action should only be taken in exceptional circumstances, when there is a definite reason to believe an error has occurred. There is no requirement to make this check, and the default position should be to refuse the application where there is a positive match.
Contact with the Home Office’s Immigration Act 2014 Banking Measures checking service can be done via telephone and email and will only be through named staff already nominated by the firm. Firms should consult their internal procedures should they need to contact the checking service.
If firms are not already registered for this service, support can be provided by the Home Office at [email protected].
Where the Home Office rescinds the notification that a firm is under a duty to close an account
There may be instances where the Home Office will rescind the notification that a firm is under a duty to close an account. The Home Office will write to the firm to rescind any notification that a firm is under a duty to close an account.
What to do if there is a service outage
Section 40(1) of the Immigration Act 2014 provides that a firm must not open a current account for a disqualified person, unless the firm has been unable to carry out a status check because of circumstances that cannot reasonably be regarded as within its control.
Paragraph 190 of the explanatory note (Immigration Act 2014 - Explanatory Notes (legislation.gov.uk) provides that this might occur, for example, ‘if it were unable to perform a check because of operational difficulties being encountered by the checking service for an extended period’.
The expectation is that the firm will refer to the specified anti-fraud organisation in the first instance, rather than continue with its onboarding processes without checking or escalating the outage or confirming whether the system is likely to be down for an extended period. These enquiries are within the reasonable control of banks or building societies and will assist firms in determining the appropriate action to take - such as temporarily pausing the onboarding process where there is evidence to suggest that the outage will be resolved within a reasonable period.
Firms should also notify the FCA in the event of a service outage.
Contact details for the Home Office
Banks or building societies can contact the Home Office at [email protected].