Hundreds of Monzo customers say they were left without access to money at the height of the Covid-19 lockdown after the online bank froze their accounts without warning.
Despite the Financial Conduct Authority telling banks it expected them to help consumers get through the crisis, Monzo has been freezing accounts without notice.
It is not the first time Monzo has been criticised for this. In January, the Guardian reported on how the company was freezing and shutting accounts for no apparent reason – but the problem appears to have grown.
Monzo, which uses algorithms to track its 4.2 million customers’ transactions, says it has a legal obligation to investigate suspicious activity and has “returned millions of pounds to victims of fraud in this way”.
However, it appears innocent customers have been caught out in recent weeks.
Asked about the current wave of complaints, a Monzo spokesman says supporting customers “is always our top priority”. He says: “We already have a number of ways to help those who find themselves in financial difficulty as a result of coronavirus.
“When we see suspicious activity we have a legal obligation to investigate it thoroughly and have returned millions of pounds to victims of fraud in this way. We have a set of automated rules that flag any activity that might be suspicious and sometimes block the account. We aim to have a person review the account within 10 minutes. If we discover that it’s not suspicious, we immediately reactivate the account.” [The Guardian]