Denied Overdraft Due To Nationality - The Reykjavik Grapevine

Denied Overdraft Due To Nationality

Published September 23, 2011

A woman from the Faroe Islands was denied a 50,000 ISK overdraft on her account with Arion Banki on the grounds that she is a foreigner. Her boyfriend recorded a conversation he had with a bank employee which confirms this policy.
Pressan reports that the woman in question has been a client of Arion Banki for the past three years. She decided to change from one branch to the other, and asked for a 50,000 ISK overdraft. A bank employee went over her financial records and, seeing that she owed nothing, told her that the overdraft would be no problem.
However, the next day she was told the overdraft had been denied on the grounds that she was a foreigner.
Her boyfriend, enraged by the news, called the bank to confirm this. He recorded the phone conversation (which can be heard at the bottom of the Pressan article) and the bank employee clearly states that the sole reason for this woman being denied the overdraft was because she is a foreigner.
Arion Bank contends that they are operating fully within their rights, but the couple have hired a lawyer. They have pointed out that this bank policy may be illegal, citing Article 180 of the Icelandic Penal Code, which states: “Anyone who in the course of business or service practice refuses delivery of goods or services to a person in equal measure to others on the basis of the nationality of the latter, colour, race, religion or sexual inclination shall be subject to fines or imprisonment for up to 6 months.”

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