Barclays blames customers for UAE account closures

Bank claims customer accounts were in violation of local financial regulations

Barclays said that the sudden closures of a number of personal and corporate accounts in the UAE this week was because they were in violation of local financial regulations, and not related to the imminent sale of the business.

Business and personal banking customers told Arabian Business that they had been telephoned by the lender on Tuesday morning, and informed that their accounts were being frozen. Arabian Business understands that around 500 accounts have now been frozen.

Customers complained that they had been given no notice of the closures and that staff in the bank’s Downtown branch struggled to explain to them why their accounts had been closed.

On Wednesday, a spokesperson for Barclays told Arabian Business that the action was “routine” and had been undertaken to comply with UAE financial regulations. They added that personal accounts had been closed for reasons including out-of-date residency visa information, or expired trade licence details for corporate account holders.

The bank insisted that all customers had been given the minimum required notice period and informed of the action via channels including telephone and email.

"Barclays routinely reviews all its accounts as part of the local and global regulatory requirements. In the UAE, as part of review process,  the bank has identified certain accounts with expired/deficient information and/or documentation and have repeatedly reached out to customers to remediate. For customers who did not provide the required information/documentation,  Barclays had to take the necessary consequential action and hence accounts were blocked. Currently, Barclays is working with impacted customers on a case by case basis to extend support where required," the lender said in an emailed statement.

Several more customers came forward to Arabian Business on Wednesday to express their displeasure with how the account closures had been handled by Barclays.

One expat who has been living in the UAE for 13 years said that a clerk at the bank told them the closure was “because you are Iranian” and was advised to open an account with a local bank.

Another corporate customer told Arabian Business that their relationship manager at the Downtown branch said that the closures were in preparation for the retail bank’s coming sale. They claimed they had been told on Monday they would be given 15 days notice before their account was closed, before it was frozen later that day. They said that they were still waiting to be paid the balance of their account by Barclays.

In September, Barclays announced it will sell its retail bank in the UAE, highlighting the challenges foreign banks face in the Gulf competing against cash-rich local rivals who are finding it easier to meet stricter rules on risk.

Under chief executive Antony Jenkins, the British bank is axing at least 3,700 jobs globally, reining in pay of senior bankers and closing businesses across the group in the face of new capital rules.

"Barclays has decided to re-focus its efforts in the UAE on its key strengths in corporate and investment banking and wealth and investment management," the bank said in a statement last month.

Join the Discussion

Disclaimer:The view expressed here by our readers are not necessarily shared by Arabian Business, its employees, sponsors or its advertisers.

NOTE: Comments posted on may be printed in the magazine Arabian Business

Please post responsibly. Commenter Rules

Posted by: FArouq

This is the Worst Bank in Dubai, I had a loan with them, and had to leave UAE as I lost my Job, but i was kept communication with them and they told me that the case is forwarded to Tahseel Legal and I had communication until they provide settlement via email, I was asking the settlement Agreement they refused for it and informed that the agreement will be provided once the payment is made within 2011 August 2011, hence I made the made. immediatealy after this the bank guy is communicating to the Tahseel and informing that the amount is insufficient need to pay 4000 AED more, which is in breach and the Tahseel was like playing and they kept silent, and until now I didnt receive my clearance letter, but unfortunately yesterday I receive a legal notification with police filied case, I dont know how to move forward with this illegal procedures of the Bank and Tahseel, they are harassing me and stressing, if any one can advice highly appreciated.

Posted by: Sergio

After 8 days of continuous phone calls, my money was refunded to me by a Manager Cheque, thanks to the hard work of my relationship manager, who pushed the top brass to organize a quick ending to my plight.
I had to go to the Emaar Business center branch to collect it, and there I had a discussion with the manager who handed me the cheque, off the record, and he agreed that top management did something unethical, to say the least, in behaving in such a way with their clients. Good.
I lost my funds for a whole week, though.......

Posted by: Jac

My account has been blocked and bank is saying it is because of not submitting the documents.I have proof for the document submission which i made in May 2013.Bank is simply giving some reasons without any base.Now , how to get the money back.Do i need to proceed legally?

It is really unethical and bank is dealing as i have done something which caused a huge loss to them.I never met this kind of approach in banking sector in my life.HORRIBLE!!!!!!!!!!!!!

Posted by: David

Barclays are applying the financial regulations of the UAE for foreign workers.
Foreign Workers are only entitled to a bank account upon having a residency visa the expiration or non renewal give the Bank the right to close the account.
All company HR Managers should advise the employees of this UAE Financial Regulation which has always been in force and ensure residency visas are renewed at expiry.

Posted by: A.D.

Don't blame Barklays, blame the British Government for going after people with off-shore bank accounts, not declaring their off-shore incomes in the U.K.

Posted by: PPM

@David. I think you will find that if you are out of the UK for most of a tax year and your contract and/or intent are to stay out for a longer period then you become "non-resident for tax purposes" and have no tax liability.
Worked for me whenever I've been employed by a UK company.

Posted by: David

If you are a British National working and resident in any of the GCC countries your bank account is not off shore and not subject to uk tax. However if your employer is a British Company and your receive salary from the UK then you have a tax liability.

Posted by: Andy

What ever happened to the old newspaper advert requirement which is usually what is required in other countries. They blame the customers who opened accounts and placed their money with them?? lol.. That is the most absurd thing I have heard.

They could easily have placed an advert in the paper over the weekend notifying their customers that they are going bankrupt and will be closing out all accounts as they have sold out. Did they do this and place an advert in the paper? Was this in the local news as well? Did they place this news on their website for their customers to see? I smell poop here...

All comments are subject to approval before appearing

Further reading

Features & Analysis
First bank merger in 20 years sets Saudi Arabia up for more deals

First bank merger in 20 years sets Saudi Arabia up for more deals

Q&A look at what the planned merger of HSBC and RBS’s Saudi ventures...

A natural move: How Dubai Chamber is strengthening its ties in Latin America

A natural move: How Dubai Chamber is strengthening its ties in Latin America

With vast resources and more than half-a-billion people, the...

If Saudi future's so bright, why can't these banks find buyers?

If Saudi future's so bright, why can't these banks find buyers?

No big-name global banks eager to buy stakes in Saudi banks,...

Most Discussed