A false rumor on WhatsApp started a run on a London bank
- Dozens of people demanded their cash and jewellery back from Metro Bank in Northwest London on Saturday, after reading false rumors on WhatsApp that the bank was going under.
- Metro Bank's stock dropped 9% this morning.
- "People are panicking" over nothing, a bank employee told Business Insider. "There is no reason to worry ... people have made a mountain out of a molehill."
- The episode shows how difficult it is to counter fake news circulating inside WhatsApp's private, encrypted environment.
Staff at the Harrow branch of Metro Bank in Northwest London were baffled on Saturday as people queued out the door to withdraw money from their accounts and remove valuables from safety deposit boxes, fearing that the bank would collapse.
The scene briefly resembled a Great Depression-style run on the bank, with dozens of customers demanding their cash and assets back, according to photographs supplied to Business Insider by two Twitter users who saw the action.
Customers had fallen victim to a false rumour spreading on WhatsApp that "the bank may be shut down or going bankrupt." The information was entirely false. (UK bank accounts are guaranteed by the Bank of England).
The episode shows just how quickly lies can spread on WhatsApp, with real-world consequences:
- In India, in 2018, five men were beaten to death by villagers who had read false reports circulating in WhatsApp that they were child kidnappers.
- Since 2017, more than 30 people have been killed in India based on false rumours in WhatsApp, according to the South China Morning Post. The false messages typically stoke hatred or call for revenge attacks against rival religious or political groups.
- In Mexico, two innocent men were burned to death after a mob in Acatlán convinced itself on WhatsApp they were child kidnappers. (Bogus child kidnapping events are a frequent staple of false news on WhatsApp.)
Officials at WhatsApp did not immediately return a message requesting comment.
Whatsapp messages are private and encrypted. Even the company is unable to read the messages being passed inside WhatsApp. That makes fake news impossible to monitor and difficult to counter.
A Metro employee told Business Insider that the incident started when there were rumours that the bank had gone under and wouldn't open on Monday morning, and that if customers didn't collect their items from the safety deposit boxes by close of business on Saturday then the bank would seize them. The rumors were "completely not true," this employee said.
An official for the bank said:
"We're aware there were increased queries in some stores about safe deposit boxes following false rumours about Metro Bank on social media & messaging apps. There is no truth to these rumors and we want to reassure our customers that there is no reason to be concerned."
A customer service rep talking on the phone confirmed that the rumor had spread on WhatsApp. "It's on WhatsApp," she said. "People are panicking" over nothing, she said. "There is no reason to worry ... people have made a mountain out of a molehill."
"Seems a lot of people are spooked about having another Northern Rock on their hands. Be interesting what Metro do to counter people panicking," said Dylan Shah, a Twitter user who photographed the events in Harrow. (The collapse of Northern Rock in 2007 also generated lines of desperate customers pulling out their cash.)
Metro Bank stock fell 9% on Monday morning. Shares recovered later in the day but were still down 6% at the time of writing.
Metro Bank's stock has fallen 85% since last year. Earlier this year, Metro admitted it had made a £1.7 billion misclassification in calculating its risk-weighted assets.
The decline on Monday appears to have been largely a coincidence, driven by investors who are skeptical of the bank's latest £350 million capital-raising round.
The rumors seem to have fed off the unrelated issue of Metro's accounting issues. That resulted in real-world consequences over the weekend. One bank employee told Business Insider that the police had said some customers had removed jewellery from the Harrow branch only to be mugged on the way home.
The source said he believed the rumors had started in the Slough area, a suburb west of London. "The queries over the weekend were very localized in the West London area, and customers are being reassured," a spokesperson for the bank said.
This was a typical false statement being circulated on Twitter over the weekend: