Warning Issued on Internet Banking

By Peter Rodgers Financial Editor | The Independent (London, England), October 11, 1996 | Go to article overview
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Warning Issued on Internet Banking


Peter Rodgers Financial Editor, The Independent (London, England)


The Bank of England yesterday warned depositors to be careful about using an Antiguan bank which has been promoting itself over the Internet, using the name of an English peer.

European Union Bank was chaired until last month by Lord Mancroft, an Old Etonian former heroin addict who campaigns for fox hunting and drug law reform.

He was called in yesterday by the Bank of England to explain the Antiguan bank's operations. A Bank of England spokesman said: "We raised our concerns with him." The Bank of England's public expression of concern about Internet banking is a result of fears that the new means of communication will put large numbers of banking transactions beyond the reach of supervisors and make it easier to launder money. The Internet allows deposit takers to solicit business anywhere in the world over an information network with no national boundaries. The Bank said it was not illegal for a foreign bank to advertise in the UK over the Internet. However, EUB appears to have broken the advertising rules which require disclosure of the paid up share capital of a bank. EUB's Internet pages give only its authorised capital of $10m (pounds 6.4m) and says it plans to announce a public offering of $115m of shares this month. The Bank of England has no powers to take action against EUB for rule infringements since it is based in Antigua and the Internet is an international and not a UK advertising medium. The Bank said it was not aware of EUB advertising in any other way in the UK and no depositor had come forward to complain.

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Warning Issued on Internet Banking
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