In lieu of new banking rules to come into force, immigrants including Nigerians living in the United Kingdom illegally will have their accounts frozen or closed.
According to the BBC, banks and building societies will carry out checks from January to see if account holders are legally in the UK – a move backed by members of the parliament (MPs)
However, former board member of TSB Banking Group, Philip Augar said mistakes would be made and “poor individuals” would suffer if the rules come into play.
The Home Office said the system was “fair” but “firm”.
Financial institutions will be provided with a list from anti-fraud organisation Cifas on people who are liable for removal or deportation from the UK or who have absconded from immigration control.
The organisations will then have to report any names they discover and freeze or close the accounts.
According to the Guardian, 70 million accounts will be looked at quarterly to check the immigration status of the holders.
Mr Augar, who also previously worked at the Home Office, said it was reasonable for “lawbreakers to expect the full weight of enforcement”, but raised concerns about how mistakes would be addressed.
He told BBC Radio 4’s Today programme: “This is in the hands of the Home Office and the banks, neither of which are exactly known for flawless execution.
“What happens when something goes wrong – if a bank account is frozen and the owner is entirely legal or if they’ve simply got the wrong name?
“Resolving those situations will be, in some cases, smoothly done, but I can imagine it being an absolute nightmare for some poor individuals.
“The problem is going to be multiple names will come up, the wrong names and bank accounts will be frozen, and it is how this is resolved, that will be the difficulty.”