Called to account

A former Big Issue North vendor was forced to have his wages paid into a friend’s bank account after his was frozen due to suspected money laundering.

Gheorghe Ardeleanu, who sold the magazine in Liverpool city centre before finding work as a handyman, spent two months trying to persuade HSBC to unlock his account – opened under a scheme for homeless people.

Instead, the bank closed the account, telling him he could not use its services again. When Big Issue North contacted HSBC to ask why, the firm relented, unblocking Ardeleanu’s account and giving him compensation.

The former vendor’s ordeal began when he lost his accommodation and moved to a shelter run by the Whitechapel Centre. When staff realised he was carrying around £500 in cash – which he had saved doing agency work – they suggested opening a bank account.

HSBC’s No Fixed Abode scheme allows homeless people to open a basic account even if they lack the ID documents banks normally require, by using the address of the agency supporting them.

But Ardeleanu ran into problems and quickly found himself unable to withdraw anything more than small amounts of cash.

Lindsay Rimmer, senior coordinator of the Liverpool office of Big Issue North, said: “The last couple of months should be a real success story for Gheorghe because he’s found a stable job, but it’s been tainted by this.

“He’s a real grafter and is used to paying bills so him having some money isn’t that unusual. But when he went in to withdraw some money he was told the account was frozen.

“This went on for two months. He was going backwards and forwards trying to sort it out, and I wrote letters and even went to the branch with him to try to solve the problem. It was really stressful for him and seems very unfair to me.

“Those in contact with homeless services are not all in the midst of a drug addiction. To be continually asked where the money is coming from, as if it’s illegitimate for him to have any, didn’t sit well with me.”

While this was going on, Ardeleanu found a place in the Cotton Street Project – accommodation for homeless people – and a full-time job. After two months he was given his money back and told he could no longer bank with HSBC, and ended up having his wages paid into a friend’s bank account. Because his identity documents were stolen last year he could not open a bank account elsewhere.

After Big Issue North approached HSBC for a comment, however, the bank reinstated his account – also crediting it with £300 to compensate him for the inconvenience.

Ardeleanu said: “I’m so happy they have reactivated my account. I had to make a lot of visits to the bank and Lindsay also came with me to the branch twice. I should have been working – I’d just got a new job and didn’t want to be seen as unreliable. But I was really worried about this and didn’t have a bank card or access to my money, which was inconvenient. It also prevented me from returning to Romania to replace my ID documents.”

HSBC says the problem arose when Ardeleanu’s no fixed abode status was not passed onto the fraud team, which checks accounts for unusual activity.

“At HSBC UK we’re committed to offering support to those who would otherwise be excluded from banking services,” said a spokeswoman. “Following an investigation, we found an oversight had led to the account closure process being started for Mr Ardeleanu. We have now halted this process and Mr Ardeleanu can continue to use his bank account as normal. We have compensated him for the inconvenience and have put measures in place to ensure it doesn’t happen again.”

---

Branching out

HSBC’s No Fixed Abode accounts aim to overcome the problem of homeless people not having ID documents.

The scheme – currently in pilot form – allows homeless people to open basic bank accounts at five branches in England, including Liverpool and Blackpool. They apply in the company of a support worker and use the agency’s address. Since April, 63 accounts have been opened – including around 50 in Liverpool, where the trial began.

Maxine Pritchard, head of financial inclusion and vulnerability at HSBC, said the scheme followed similar work providing accounts for survivors of trafficking and modern slavery, who face similar barriers.

“They may lack identity documents and their own bank accounts may have been used for fraudulent purposes. Because of this we are working closely with teams who have to review the cases,” she said.

“Homeless people face similar risks from a banking perspective so it seemed logical to extend these services to this group as well.”

Nationally, 20 branches have been designated as survivor banks, with staff specially trained to work with these vulnerable customers. It is hoped that by the end of this year all these branches will also offer No Fixed Abode accounts.

Pritchard said: “Opening a bank account can give people a true sense of independence – having somewhere to pay benefits into and wages into and having a secure mechanism for looking after their money rather than having pockets of cash, which makes them vulnerable.”

Success stories include the opening of an account for a man who has been homeless for 12 years. This meant he was able to claim benefits for the first time in more than a decade and has been put on the housing list.

A spokeswoman for the Whitechapel Centre said: “The Whitechapel Centre has supported over 50 homeless people to open bank accounts with HSBC UK. These are people who would have otherwise struggled due to lack of ID.

“Having access to a bank account is central to reducing social exclusion and a lack of bank account can hinder people accessing benefits or work. We’re really grateful to HSBC UK for all their support in tackling this challenge.”