Financial services industry commits to new code of practice to support victims of financial abuse

The financial services industry has committed to providing further support to victims of financial abuse with the introduction of a voluntary Code of Practice¹.

In recent years² the financial services industry has recognised the need to address financial domestic abuse and this new Financial Abuse Code of Practice, designed to take forward the Financial Services Vulnerability Taskforce recommendations, will bring increased awareness and better understanding of what abuse looks like for firms, colleagues, victims, potential victims and their families, ensuring more consistency in the support available for those who need it.

Financial abuse can take a variety of different forms within relationships, whether by intimate partners, family members or carers and may manifest itself as financial control, dependency, exploitation or sabotage. The Financial Abuse Code of Practice considers financial abuse scenarios including those within the context of partner relationships, domestic abuse but also the older population as a particularly relevant demographic at risk.

The Code of Practice has been developed with input from representatives from charities, victim support groups and government departments, alongside UK Finance's Financial Abuse Project Group and Consumer Advisory Group³. Over the next 12 months, eleven of the largest high street firms have committed to implementing the voluntary Code with more firms expected to follow, raising awareness, training colleagues and introducing other initiatives to help victims regain more control over their finances.

As the Code is rolled out, victims will be able to have more informed conversations with their providers. The Code will provide greater awareness of the impact of abuse on their personal and financial circumstances, give enhanced support to regain control of their finances and greater consistency in the support individuals receive across providers. From the moment a customer discloses a case of financial abuse, they should be reassured they have made the right decision and that they will be supported throughout the process. Firms already have measures in place and assist victims based on their individual circumstances, however the Code will bring greater awareness and consistency in response across the financial services industry.

Eric Leenders, Managing Director of Personal Finance at UK Finance, said

Financial abuse does not discriminate - it can happen to anyone and whether you or a person you know is a victim of financial abuse, taking those first steps to seek help is very brave. The financial services industry can play a key role in helping combat financial abuse, offering support to victims to help them regain control of their money. This new voluntary Code provides further guidance for banks and building societies and, once rolled-out, will help raise awareness amongst staff so that victims of financial abuse can be confident that they will be treated sympathetically and positively in these particularly difficult circumstances.

The following lists the high-level Vulnerability Taskforce principles which the Financial Abuse Code of Practice aims to cover. Further detail on what would need to be implemented as a minimum in order to meet each principle is listed in the Code of Practice? (* further information provided in Notes to Editors).

  1. Raising awareness and encouraging disclosure
  2. Training of colleagues
  3. Identification and appropriate response
  4. Minimising the need to repeat one's story in the same organisation
  5. Help to regain control of finances
  6. Signposting and referrals
Area of expertise:

Notes to editor

<p><a href="… release announcing the Vulnerability Taskforce, 2016</a><br /><a href="file:///H://Downloads/Improving-outcomes-for-customers-in-vulnerable-circumstances-FINAL-web-version-v2%20(3).pdf">Report: Improving Outcomes for Vulnerable Customers, 2016</a></p>
<ol><li>The Financial Abuse Code of Practice will be rolled out across the financial services industry over the next 12 months.  This timescale will ensure that firms? frontline staff are provided with training to ensure victims are provided with the most appropriate response by their financial institution. A list of the firms who have committed to the voluntary agreement can be found here:  <a href="/system/files/Financial-Abuse-Code-of-Practice.pdf" target="_blank">financial-abuse-code-of-practice</a> This list includes parent and related brands within each group.We expect more firms to commit over the coming months.</li>
<li>In recent years, the financial services industry has recognised the need to address financial domestic abuse.
<ul><li>?My Money, My Life? campaign, launched in December 2015 by the Co-operative Bank in partnership with Refuge, national domestic violence charity, called for industry-wide agreement to support people who experience financial abuse in their relationships: <a href=""…;
<li>In September 2016, the financial sector, along with consumer and charity groups, also launched the first ever <a href="… Taskforce</a>. In a bid to understand the personal factors, life events and wider circumstances or relationships that can make customers vulnerable, the Taskforce undertook extensive research and discussions.</li>
<li>Vulnerability Taskforce: Principle 6 ? Customers particularly at risk of being scammed or financially abused need to be (and feel) protected by their financial service provider. We recommend that financial services firms be more proactive in working to help combat financial abuse, including working with other organisations to raise customer awareness of risks and practices resulting in financial abuse and in offering help to customers who have fallen victim to such abuse.</li>
<li>In 2017, the Citizens Advice Bureau and the BBA launched <a href="… Financial Abuse</a>, a report to encourage banks, building societies, other creditors and advice providers how they can support victims of financial abuse.</li>
<li>UK Finance Financial Abuse Project Group and UK Finance Consumer Advisory Group worked with representatives from the following organisations to develop the Financial Abuse Code of Practice:<br />
Age UK<br />
Citizens Advice<br />
Department for Work and Pensions (DWP)<br />
HM Treasury<br />
Home Office<br />
Lloyds Bank Foundation<br />
Ministry of Justice<br />
Money Advice Service<br />
Money Advice Scotland<br />
Money Advice Trust<br />
Northern Ireland Consumer Council<br />
Office of the Public Guardian (OPG)<br />
Refuge<br />
StepChange Debt Charity<br />
Surviving Economic Abuse<br />
Tender<br />
Women?s Aid</li>
</ol><p>UK Finance is the trade association formed on 1 July 2017 to represent the finance and banking industry operating in the UK. It represents around 300 firms in the UK providing credit, banking, markets and payment-related services. The organisation brings together most of the activities previously carried out by the Asset Based Finance Association, the British Bankers? Association, the Council of Mortgage Lenders, Financial Fraud Action UK, Payments UK and the UK Cards Association.</p>
<ol start="4"><li>Financial Abuse Code of Practice</li>
</ol><p> </p>
<div class="data-table">
<table width="100%"><tbody><tr><td>PRINCIPLE</td>
</tr><tr><td>1. Raising awareness and encouraging disclosure</td>
<td>a. Firms will raise awareness amongst colleagues within the firm about the existence and impacts of financial abuse including:<br />
? What financial abuse looks like<br />
? Affected groups and demographics at risk<br />
? Key challenges faced by victims in/from their financial relationshipb. Firms will adopt and make available to consumers an industry wide Consumer Information leaflet, providing consistent information about how financial institutions can help victims of financial abuse and what they can expect, in order to support victims (including third parties) to engage early with their financial provider.</td>
</tr><tr><td>2. Training of colleagues</td>
<td>a. Front line colleagues display empathy and will have the skills and knowledge appropriate to their role, to provide support to customers who are victims of financial abuse.
<p> </p>
<p>b. Colleague training will align with the present Code of Practice and include:<br />
? Empathy (this can be part of wider/vulnerability training)<br />
? Awareness of any referral process / access to specialist team, or most experienced colleagues, or information<br />
? Ability to understand and recognise potential signs and effects of financial abuse; demographics at risk will be highlighted to colleagues;<br />
? Training refreshers<br />
? Ongoing observations and assessment of customer outcomesc. Firms will have support mechanisms for employees who may be themselves victims of financial abuse or otherwise vulnerable, to help them address the situation and improve their resilience for dealing with customers in similar situations.</p>
</tr><tr><td>3. Identification and appropriate response</td>
<td>a. Colleagues will acknowledge and where appropriate / safe record, with the customer?s explicit consent, relevant information that the customer wishes to disclose about their financial abuse.
<p> </p>
<p>b. Colleagues will, upon notification of suspected financial abuse by the customer, offer a supportive response:<br />
? This may include: a suggestion to move the discussion to a different channel of choice, allowing more time to think (e.g. longer appointments, separate room, deferral of a decision to a later date), referral or signposting to specialist help).</p>
<p>c. Colleagues will be equipped to share the relevant information (including the above referenced Consumer Information), on the options available to the customer to help inform their next steps, once they have either recognised, accepted or suspect any kind of financial abuse that they have been subject to.</p>
<p>d. Firms will help customers and seek to minimise inconvenience and distress in response to a disclosure and offer specialised support as appropriate.</p>
<p>e. Firms will trigger the Banking Protocol (where it is in place across the country), where the situation requires the immediate response of the police.</p>
</tr><tr><td>4. Minimising the need to repeat one?s story? in the same organisation.</td>
<td>a. Firms will advise the customer which areas within that business have been notified and support the customer with the details of other parts of the business, or separate brands.</td>
</tr><tr><td>5. Help to regain control of finances</td>
<td>a. Colleagues understand the fact that someone may not wish to talk to the firm as an individual and, subject to appropriate authority from the customer, accept their representative (charity / victim support organisation, including community service worker, family, specialist etc.)
<p> </p>
<p>b. Firms will treat situations on a case by case basis and provide exception processes where appropriate, to help customers who are victims of financial abuse.<br />
? Principles of communication with third parties previously unknown to the firm include:<br />
o Communication has to be customer led<br />
o The firm can identify the customer<br />
o The firm could send account related information to a refuge, other postal address, if needed<br />
? Firms will consider, where it is considered safe and appropriate, the use of alternative addresses for victims of financial abuse, such as registered refuges, safe house addresses or other addresses, as requested by the customer.<br />
? Firms will consider informing the customer how to authorise an agent/third party for temporary (short or medium term) delegation on their account (e.g. a third-party mandate).</p>
<p>c. Firms will support victims in accessing financial services in their own name, including:<br />
? Consideration of non-mainstream documents as proof of identity and address (where other standard documents are not available).<br />
? Provision of a basic account wherever possible.</p>
<p>d. Firms will support victims of abuse to access existing funds, accounts and services including:<br />
? Security: Setting up or changing access and other security codes (on sole accounts)<br />
? Channels: Enabling access to funds via channels which do not leave a footprint (e.g. opening an account online creates a non-geographical sort code)<br />
? Joint assets and liabilities:<br />
? Firms shall inform the victim of other assets and all liabilities held with the organisation, in recognition of the fact that a victim may be unaware of credit taken out in their name.<br />
o Where systems do not allow visibility across products, firms will inform victims of how they can enquire about other products possibly held in their name, including via their credit score as per the Consumer Information.<br />
o Where accounts held with a firm are zero in balance (and the firm is confident that taking action will not create undue detriment for the other party) the firm shall remove either party from a joint account, at their request, without requiring all to sign.</p>
<p>e. Firms shall provide support for customers with debt and arrears and work with the victim to help prevent further debt from accruing, including by reviewing applicable charges and fees.</p>
</tr><tr><td>6. Signposting and referrals</td>
<td>a. Firms will advise the customer which areas within that business have been notified and support the customer with the details of other parts of the business, or separate brands.</td>