A few months ago we (our company) received a letter from HSBC stating they were closing our account against our will on the 15th June. They did not give a reason. I have emailed them time and time again for an explanation and nothing has been forthcoming. We have run our account in an orderly fashion for approximately 10 years. We turn over £500,000 plus a year as a financial services company based outside of the UK. I would like to know if I have any legal recourse for the decision HSBC have made as it will incur substantial problems for us as a company.
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Do you have a relationship manager at the bank please?
is this person willing to take your calls or able to offer any explanation for the bank's actions?
I have tried many times to no avail
how much notice did the bank provide you with?
she has not been helpfull at all
3 months i think
the starting point is that the bank is able to decide with whom it does business and it is not under any legal obligation, unless that obligation arises by contract, for example the minimum contractual term being agreed by the bank the provision of service which would be unusual, to provide banking services to a customer.
However, a bank must not close and account for an improper reasonable purpose, for example they should not close an account due to discrimination or commercial bias.
If the bank as given no reason for its decision, consider writing a letter of complaint in respect of the way the bank has treated your business and request an explanation for the decision. If the decision is based on an improper purpose, the may be grounds for a further complaint or compensation
The frustrating issue is, they will not tell me why they are closing the account. We have been with them for years and all our personal accounts are also with them
subject as above, the bank must give you reasonable notice. The banking code provides for a minimum notice period of 30 days but for business customers reasonable notice would likely be longer than this they three months notice is probably sufficient unless you can show that it is not
i do agree with you bit still no one is telling us why?
icomplaining through the usual channels has got me nowhere
if you are receiving no joy from your relationship manager or your usual contacts I suggest you consider escalating the matter to the bank's business complaints Department. They are required to respond to you according to their complaints policy within a certain time frame. Their address is:
The Manager Service Quality Team HSBC Bank plc, Arlington Business Centre, Millshaw Park Lane, Leeds, LS11 0PP
I have done that and still nothing
a gentleman on the phone earlier at the bank was instructed to read out a letter to me. It read the same as the original…no explanation..
because your turnover is within the accepted limits, if you have either received no response from the complaints department or not satisfied with the response that they have given you, you have the right to escalate the matter to the financial ombudsman. The Muslim can order disclosure from the bank in order to determine whether their actions are fair or not and order compensation to be paid to you if it finds that they are not.
thanks. How do I go about it.
There are various agencies which are necessarily secretive such as the serious organised crime agency and so on which can make various requests and orders on banks and some of those orders require that the organisation is not allowed to disclose the reason for the intervention or action so as not to tip off the customer. I do not suggest for a moment that this is the case here but I raise this because it may be that there is some form of question with regards XX XXX or more of the transactions you have dealt with perhaps by one of your clients which is being investigated behind the scenes and the bank is not allowed to disclose the reason why but equally this may be very wide of the mark. As you say unless the bank is prepared to disclose the reason, it can only be conjecture I certainly would not jump to the above conclusion.
in terms of moving the matter for it to the ombudsman, if you have exhausted the complaints process of the bank, you can make a complaint to the ombudsman free of charge using the following link:
Thanks Joshua. No there are no suspicious transactions.none…all our income comes from companies we deal with on the Isle of Man
the ombudsman has legal power to adjudicate on complaints from small businesses with turnover under €2 million and less than 10 employees. if you exceed these thresholds, they may reject your complaint
we don't exceed this
i have another related question
in the meantime, I'm sure you already doing so, you should start to seek alternative banking facilities that you are not court short if the complaint is not resolved in time or in your favour. one would hope that the complaints process will at least generate an explanation for the bank's actions if nothing else
certainly. Before we move on can you confirm that you are happy with all of the above so far?
I think you have answered it
I am happy with all the above.
Thanks. Do you have further question you wanted to us?
Sorry ... ask?
I was about to ask, if this case goes to the ombudsman, can they close the account if the case is still on going
or would it give us more time
yes I believe they can the you can ask the bank to give you an extension of time to enable the ombudsman to make a determination or because three months notice does not give you sufficient time to find alternative banking arrangements
thanks I will do that first
a pleasure. Is there anything else I can help you with?
you have answered all . thanks very much
If you have no further questions for now I should be very grateful if you would kindly remember to click ACCEPT in order that I am credited for my time. Kind regards
you too. have a good weekend. I would like to save the chat. if I click and save will i still have the accept button bisible
I'm not sure as we see a slightly different screen however when you click accept, the thread does not get deleted but rather is saved to your account from which you can return to the thread at any time of your choosing.
ok. great. take care
LL.B (Hons), Prof Dip Law & Practice. 9 years experience in private practice in England
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