Blacklisting at banks is a phenomenon that can severely disrupt the lives of those involved. You try to open a bank account, apply for a mortgage or get a credit card and everywhere you are rejected. Without further explanation your application is refused. Only later do you discover that you are registered on an internal or external watchlist. In this article you will read what blacklisting at banks precisely entails, how it arises, what consequences it has and what you can do about it.
What is blacklisting at banks?
Blacklisting at banks means that you are registered in a warning system used by
financial institutions to manage risks. These registrations act as a signal that you have previously been involved in fraud, irregularities or other incidents relevant to financial institutions. The term blacklisting is widely used in everyday language, although financial institutions themselves refer to registrations in referral registers. The main registers in which registrations can take place are the Extern Verwijzingsregister (EVR), the Intern Verwijzingsregister and the Incidentenregister. Each of these registers has its own function and its own rules for registration and access.
How does blacklisting at banks arise?
There are various ways in which you can end up on a warning list at banks. The most common causes are related to fraud, irregularities or failure to fulfil financial obligations.
Registration via an insurer
A common route to blacklisting at banks runs via the insurance sector. If an insurer accuses you of insurance fraud and your policy is cancelled (royement), the insurer can register you in the EVR. This register is consulted not only by insurers but also by banks. A registration that originally arose from an insurance dispute can therefore also affect your relationship with your bank.
Registration by the bank itself
Banks can also carry out registrations themselves. This can happen in cases of suspected involvement in money laundering, if you make your bank account available for fraudulent transactions, in cases of identity fraud or other irregularities observed by the bank. Under the Wet ter voorkoming van witwassen en financieren van terrorisme (the Dutch Anti-Money Laundering and Counter-Terrorist Financing Act) banks are obliged to report unusual transactions and may proceed to registration in case of serious signals.
Registration due to arrears in payments
Serious arrears on loans or mortgages can also lead to a registration with the Bureau Krediet Registratie in Tiel (BKR). Although this is strictly speaking not blacklisting,
a BKR registration has comparable consequences. Other financial institutions see the registration and may on that basis decide not to offer you financial products anymore.
Consequences of blacklisting at banks
The consequences of a registration at banks are far-reaching and affect almost all aspects of your
financial life.
No new bank account
Without a bank account it is almost impossible to function in today’s society. You cannot receive a salary, pay rent or make online purchases. If banks refuse you because of a registration, you end up in a very difficult position. Although banks are required under European rules to offer a basic payment account, there are exceptions to this obligation that a bank can invoke in certain cases.
No mortgage or loan
A registration makes it virtually impossible to obtain a mortgage or personal loan. Banks consider you a higher risk and will in most cases reject your application. This can have enormous consequences for your housing situation and your ability to finance major purchases.
Problems with existing accounts
A registration can also affect your existing banking relationships. The bank may decide to terminate your account, withdraw your credit facility or block your credit card. In practice it regularly happens that a bank wants to end the relationship with the customer after a registration.
Consequences for your business
If you are an entrepreneur, blacklisting at banks can have disastrous consequences for your company. Without a business bank account you cannot receive or make payments. Obtaining business credit becomes impossible and your suppliers and customers may lose confidence in your company.
Difference between the various registers
To understand the consequences of blacklisting at banks it is useful to distinguish between the different registers. The Intern Verwijzingsregister is only accessible to the financial institution that made the registration. The Extern Verwijzingsregister is shared with all connected financial institutions and therefore has a much broader impact. The Incidentenregister contains information about incidents relevant to the safety and integrity of the financial sector.
In addition there is the Bureau Krediet Registratie in Tiel (BKR), which keeps records of loans and payment arrears. A BKR registration is strictly speaking not blacklisting, but the consequences are similar: other financial institutions consult the register and may
on the basis of negative registrations decide to reject your application. It is important to know in which register you are precisely registered, because the rules for access, objection and removal may differ per register.
The duration of a registration and possibilities for shortening
A registration in the EVR can last for a maximum of eight years, but this is not automatic. The duration of the registration must be proportional in relation to the seriousness of the conduct. Case law contains several examples where judges have shortened the registration period, for example from eight to three or four years, because the original duration was judged disproportionate. Factors that play a role include the seriousness of the incident, the degree of culpability, the consequences for the person involved, the passage of time and the behaviour of the person involved after the incident. A lawyer can assess whether there are grounds in your situation to request a shortening of the registration period.
Your rights in case of a registration
Financial institutions may not simply make registrations. Strict rules apply that protect your rights as a data subject.
Right to information
The financial institution is obliged to inform you about a registration. You must know that you are registered, in which register the registration is recorded, what the reason is and how long the registration will last. In practice this duty to inform is not always properly complied with, which can be a ground to challenge the registration.
Right of access
Pursuant to the AVG (the EU General Data Protection Regulation, commonly referred to by its Dutch abbreviation AVG) you have the right to access the data registered about you. You can submit a request to the financial institution to inspect all personal data that have been processed in relation to the registration. The institution must respond to your request within one month.
Right to rectification and deletion
If the registration is incorrect or unlawful, you have the right to rectification or deletion of the data. You can ask the financial institution to correct or delete the registration. If the institution refuses, you can file a complaint with the Autoriteit Persoonsgegevens (Dutch Data Protection Authority) or start proceedings in court.
Challenging a registration Challenging a registration at banks requires a considered approach. There are several routes you can take.
Objection to the financial institution
The first step is to object to the institution that made the registration. Explain why you believe the registration is unjustified or disproportionate and support your position with evidence. The institution is obliged to consider your objection seriously.
Complaint to Kifid
If your objection is rejected, you can file a complaint with the Klachteninstituut Financiële Dienstverlening (Kifid). Kifid handles complaints about banks and insurers and can issue a binding decision. In registration matters Kifid has on multiple occasions ruled that registrations had to be removed or shortened because they were disproportionate.
Proceedings in court
As a last option you can start proceedings at the court. The judge assesses whether the registration meets the statutory requirements and whether it is proportionate. Case law contains numerous examples where judges have ruled that registrations must be removed. The judge weighs all the circumstances of the case, including the seriousness of the conduct, the consequences for the person involved and the passage of time since the incident.
Proportionality test for registrations
An important assessment criterion is the proportionality of the registration. The registration must be proportionate to the seriousness of the identified irregularity. A registration for eight years because of a relatively minor incident can be considered disproportionate. The judge looks at, among other things, the nature and seriousness of the conduct, the degree of culpability, the consequences for the person involved, the passage of time and whether the person has since shown good behaviour.
The right to a basic payment account
Under European rules every consumer who lawfully resides in the European Union has the right to a basic payment account. This right is implemented in the Netherlands in the Wet op het financieel toezicht (the Dutch Financial Supervision Act). A bank may refuse a basic payment account only in exceptional cases, for example if opening the account would be contrary to the Wet ter voorkoming van witwassen en financieren van terrorisme. If you are rejected everywhere for a regular bank account, you can invoke this right.
Legal aid with subsidy
Challenging a registration at banks can be legally complex. If your income is limited, you may be eligible for subsidised legal aid through the Raad voor Rechtsbijstand. With a legal aid grant (toevoeging) you pay only a personal contribution and the government covers the other lawyer costs. This way you can challenge an unjust registration even with limited means.
The emotional impact of blacklisting
In addition to the financial and practical consequences, blacklisting at banks also has a significant emotional impact. The feeling that you are distrusted by financial institutions, the uncertainty about your financial future and the shame that can accompany it are factors that can weigh heavily. Many involved feel powerless against large financial institutions that make decisions that profoundly affect their lives. It is important to know that you are not powerless. The law offers you protection and there are effective legal remedies to challenge an unjust registration. By engaging legal help in time you can not only restore your financial position but also regain a sense of control over your own situation. A good lawyer relieves you of the legal burden so that you can focus on restoring your daily life.
Have a specialist assess your registration
Blacklisting at banks can disrupt your life, but you do not have to accept this. A
specialised lawyer can assess whether the registration is justified and proportionate and can assist you in challenging an unlawful registration. The sooner you take action, the greater the chance that the registration will be removed or shortened. Are you registered with a bank or insurer and experiencing consequences? Contact us for a free, no-obligation conversation about your options. Our lawyers have experience with registration issues and are happy to help you restore your financial freedom.
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