Not upheld: unreasonable account restriction and closure; difficulty accessing remaining funds complaint against Zempler Bank Limited

Decision detail

Summary

O, a charity, complained that Zempler Bank Limited unreasonably restricted and then closed their account without explanation, preventing them from conducting charitable work. The account was restricted in October 2025 with 90 days' notice of closure, though restrictions remained throughout. O also faced difficulty accessing the remaining balance of £166.91 as Zempler required a bank statement from a new account. The ombudsman found that Zempler's actions were justified by their legal and regulatory obligations to monitor accounts for financial harm and other risks, and that the bank was not obliged to provide detailed explanations for their decisions. The complaint was not upheld.

The Ombudsman's reasoning

Zempler Bank, like all UK financial businesses, has legal and regulatory obligations to monitor accounts for signs of financial harm, fraud, and money laundering. These obligations permit account restrictions during reviews. There is no specific obligation to explain the reasons for restrictions or closure. The ombudsman was satisfied Zempler's concerns were reasonable and that the circumstances justified closure under the account terms. The requirement for a bank statement to verify the recipient of remaining funds was reasonable to ensure funds reached the correct entity.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website