HSBC to close bank accounts of Islamic aid charity after 'risk appetite' review

The Ummah Welfare Trust, which operates in locations including Gaza, Iraq and Syria, has urged supporters to lobby the bank to reverse the decision

HSBC
HSBC

The bank HSBC has told an Islamic international aid charity that it will close eight of the charity’s bank accounts on the grounds that its activities fall outside the bank's "risk appetite".

The Ummah Welfare Trust, which is registered with the Charity Commission as the Amanat Charity Trust, describes its mission on its website as the alleviation of poverty "inspired by the Islamic teachings of empathy, generosity and selflessness". It has 110 projects operating in nearly 20 locations, including Gaza, Iraq and Syria.

The charity was sent a letter by HSBC earlier this week. The letter, which the UWT has published on its website, says: "HSBC Bank has recently conducted a general review of its portfolio of customers and has concluded that provision of banking services to Ummah Welfare Trust now falls outside of our risk appetite."

The charity posted on its Twitter account: "This, in layperson’s terms, means that UWT is not profitable for HSBC any more. This is hard to understand, because the charity pays the customary bank charges to HSBC like any other business."

It said in a statement on its website: "This is very similar to what Barclays did to Ummah Welfare Trust during the previous Gaza war in 2008 when they served notice to close our accounts." Shaykh Muhammad Ahmad, a trustee of the charity, said this was "another test from Allah".

The charity has urged supporters to email or telephone the bank or tweet using the hashtag #LobbyHSBCforGaza to ask HSBC to reverse its decision – and has suggested they boycott the bank if it does not.

The charity said on its website that it would continue to provide support in Gaza using other bank accounts.

A spokesman for the bank said that he could not comment on individual customers, but said that such risk reviews were carried out regularly.

"When a bank talks about risk, there are a vast range of things that would be brought under consideration," he said. "I can categorically state that banking decisions are not made on the grounds of race or religion; that is immoral and illegal."

Earlier this month, the Charity Finance Group launched a survey of the sector’s view of the effect of banks "de-risking" through increased checks for money laundering and terrorist activity. A spokeswoman for the CFG said that the survey remains open and that results would be published later in the summer.

The news comes at a time when Muslim charities’ relationships with the commission are under scrutiny because of accusations of bias.

Click for more on the topic in our Big Issue analysis, which can also be read on page 10 of the new edition of Third Sector magazine, out this week.

Sam Burne James recommends

Ummah Welfare Trust

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