Cancer charity offered compensation after bank account closed in error

Charity

A Cambridge-based cancer charity has received £750 in compensation after NatWest closed its account for six days in error. 

Please Take Me There, a volunteer-led charity that provides transport to hospital treatments for children with cancer in the UK, Myanmar and Ghana, said it was unable to operate for six days after its NatWest bank account was closed in error.

UK charity regulators called for major UK banks to improve services for charities last year, amid a series of sudden account freezes and closures impacting charities.

Fernando Pinho, who founded Please Take Me There a decade ago, told Third Sector that he discovered the charity’s NatWest account was blocked after trying to deposit a £1,000 cash donation from a local company on Monday.

The deposit was denied, and Pinho was informed by a NatWest associate that the account had been blocked due to insolvency. 

The error was due to confusion related to the charity’s former registration as a community interest company, Pinho said. 

The CIC had been deregistered with Companies House after the organisation had received charitable status and its former bank account with NatWest was closed. 

But Pinho said that after Companies House notified NatWest of the CIC’s closure, the bank mistakenly closed the charity’s active account.

Pinho said there was no communication prior to the account being closed, adding that “there was no paper trail, nothing”. 

NatWest associates initially told Pinho to contact Navar, a third-party company that manages insolvency for the bank, which he said was “unreachable” and failed to reply to emails from NatWest directly about the issue.

After NatWest investigated the closure, Pinho was informed that the account had been blocked for a period of six days.

Pinho said: “For us it was awful because if you went to the bank to make a donation you couldn’t. You were just told that the account doesn’t exist. We couldn’t pay any bills. We couldn’t actually operate without the account.”

He added that he “has no clue” about how much money was lost in donations during the account closure, but said that the charity typically receives about £2,000 a month in donations through direct bank transfers.

But Pinho said his biggest concern was the effect of the closure on the credibility of the charity if the situation had dragged on longer. “What happens if you send money to a charity and that money comes back and the bank account doesn’t exist? The immediate reaction will be: ‘Oh, is your charity actually open? Or do they actually exist?’ 

“And that has an impact on your credibility and image and that to me was my biggest fear.”

Pinho said: “We are a tiny micro-charity, run by three volunteers. But imagine if we had staff to pay salaries to – this happened around the time people are being paid.

He added that when he posted about the situation on a charity Facebook group, he found that many other charities had similar experiences. He said: “This is happening to other charities and it’s such a basic, basic error. But it’s one of those mistakes that can have a huge impact, especially when the charity is as small as ours.”

NatWest has reopened the account and offered the charity £750 in compensation, Pinho said. It also provided the charity with a letter for its supporters and donors, which stated that the disruption to donations was due to the bank’s error, not the charity’s.

A spokesperson for NatWest said: “We apologise unreservedly for an isolated administrative error which resulted in this charity being unable to access their account for six days. 

“The account is now active and we are arranging to compensate the customer for the inconvenience this error caused.”

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