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April 1, 2022

Banks warn UK government on ban targeting all Russians

Understand the impact of the Ukraine conflict from a cross-sector perspective with the Global Data Executive Briefing: Ukraine Conflict


UK banks have warned the government that its decision to curb deposits from all Russian is impractical and illegal, Reuters reported citing sources. 

After Russia invaded Ukraine, the UK announced that “under new banking restrictions all Russians will be banned from having significant savings in UK bank accounts.”

As per government data, over 70,000 individuals of Russian origin are currently living in the UK and the government is planning to ban all Russians from holding over £50,000 in their accounts. 

The banking industry sources fear that such a move would violate equality laws, which ban discrimination based on persons’ nationality.

“What they are proposing is illegal, there is no question about it. This feels like a rushed announcement where the consequences have not been thought through,” a bank executive who was in touch with the government on the plans told the news agency.

The UK, along with its allies, has imposed unprecedented sanctions targeting Russian banks, the Central bank of Russia, President Vladimir Putin, and elites. 

Among the measures taken, the curb on bank deposits is the only one that targets all Russians in the country. 

Notably, the banks have sought reassurance that they will not be sued if they implement the measures, the sources said. 

Furthermore, such protection would require amendments in the laws, while the banks would have to update their technology and account opening processes to implement the curbs, which may be too complex to implement. 

Earlier, the European Central Bank had asked banks to intensify monitoring of transactions by customers of Russian origin. 

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