The banking group has put Jersey-based accounts held by UK clients under scrutiny.

HSBC said it is reviewing details of Jersey-based accounts held by clients in the UK as it tightens up protections against potential fraud and other crime.

The actions are not connected with the Geneva-based private banking arm of HSBC, which has come under a storm of criticism following allegations that it was used to shelter tax dodgers. (In that saga, the bank says it has, since 2008, sharply reduced client numbers and assets held in Switzerland, as well as overhauled its processes.)

Following a report by the BBC yesterday stating that “HSBC is closing accounts on Jersey belonging to customers living in the UK”, a spokesperson for the Hong Kong/UK-listed bank said: “We have been reviewing the details we hold on our customers to ensure we have the information we need to protect them, together with wider society, against fraud and other financial crime.

“With financial crime becoming more sophisticated, keeping accurate, up-to-date information on customers, such as complete proof of identity or address, helps us monitor transactions effectively for potential fraudulent activity,” the spokesperson added.

The BBC referred to this “remediation exercise” as part of a move by banks to ensure offshore accounts cannot be used to hide money from UK tax authorities. It said account-holders in Jersey have been told by HSBC to go to local branches with passport and address details, or otherwise their accounts may be shut down.