Human Rights in Finance (.EU)

On June 28, 2022 the UN published a press release and guidance note that hits the bull eye. It reads:

GENEVA (28 June 2022) – A UN human rights expert today urged banks and other financial institutions around the world to stop over-complying with sanctions regimes imposed by various countries, saying the practice was inadvertently leading to human rights violations.

In essence, in their drive to make all financial institutions comply, supervisors around the world are pushing strong on compliance with sanction rules. In order to be safe rather than sorry (and avoid fines) companies may be overdoing this for a series of reasons.

Apart from the guidance note. the Medium-article: Sanctions as an institutional and social construct — not just as a ‘technical’​ measure, provides a further analysis that may be helpful in understanding the importance of Human Rights in Finance.

Financial institutions need to respect en promote the proper application of fundamental human rights. We all agree on that.

But when we hear financial institutions explaining that they abide with the UN Guiding Principles for Business and Human rights (UNGPs) in the context of the finance sector, they mostly mean to say they will check whether their financial products do not cause harm to the environment or human labour relations.

Financial institutions have a rather big blind spot for direct human rights infringements that are a part of everydays finance business: the continuous monitoring of all transactions in their systems and the reporting of many of those transactions without any suspicion of real crime being present and without due process and recognition of the privacy and innocence of their users.

This monitoring may lead to consumers and companies being denied acces to their own funds and being denied their ownership of property rights to the financial claims that they wish to transfer. It also leads to an a priori exclusion of so called ‘high-risk’ categories of consumers or companies, which categorisation in itself is discriminatory in nature and excludes significant groups of users and companies from the financial system.

Although the UN Guiding Principles also cover such direct impacts, most policy makers view the exclusion, monitoring and denial of the execution of private transactions as an unintended but legitimate consequence of financial sector anti-money laundering regulation. Human Rights in Finance (HRIF.EU) sees this behaviour of financial institutions as a fundamental ongoing hidden violation of human rights that has creeped into the financial sector as a bad habit, akin to smoking. It is bad for the health of our financial system.

HRIF.EU seeks to educate the public, financial institutions, regulators and supervisors on the need to recognize and stop these habitual mass scale human rights violations that happen in the name of generic policy objectives such as the fight against money laundering. It seeks to ensure that courts, lawmakers and public demand that financial institutions and supervisors redesign their laws and work procedures to ensure an a priori protection of the fundamental human rights that are at stake.

Among those human rights are, the right to privacy, the right to be innocent until proven guilty, the right to enjoy ownership of your own goods and the right to participate and contribute in society (by means of ready access to the financial system).

HRIF.EU is an association of organisations that represent consumers, companies and the fundamental human rights interests that are at stake. It has their mandate to represent their interests as a part of advocacy efforts that seek to establish a new and better balanced set of financial regulations that do no longer intrude on fundamental human rights and that promote inclusivity and the unhindered participation of each citizen of this planet in fundamental financial activities.