Remove Red Tape or Pay Banks to Avoid Mass Debanking, Report Says

The government needs to either scale back red tape or compensate banks in order to stop a “debanking epidemic,” a think tank has said. According to a report published on May 16 by the free market Institute of Economic Affairs (IEA), banks are forced to cancel tens of thousands of innocent customers’ accounts because the cost of complying with anti-money-laundering (AML) regulations is too high. The report said while the banks are “rightly” free to disassociate themselves from those they don’t want to serve, when they are “co-opted by the government to act as crime fighters,” they tend to presume guilt because in many cases, it’s not commercially viable to find out whether a customer is innocent....