Are banks allowed to take charges from benefit money?

[MikeBigg]

Hi,

 

Are banks allowed to take charges from benefit money?

 

I have a friend (suroprising I know ) who has had bank charges applied to her account for exceeding an agreed overdraft limit. She has no overdraft facility, so the "crime" was to go overdrawn.

 

She is a single mum with two kids under 3 and currently get £140 every two weeks (IIRC). The bank Abbey, now Santander, then take £30 from this causing the cycle to continue. This has been going on for a couple of years, so my friend is now hundreds of pounds out of pocket.

 

I remember reading on here that abnks aren't allowed to touch benefit money. Is this true?

 

If this is true, what is the best way to get this money returned?

 

If it isn't true, what is the best way to get this money returned?

 

Kind regards,

 

Mike

[rebel11]

Hi Mike

 

Some interesting info:- http://www.consumeractiongroup.co.uk/forum/showthread.php?268614-Hardship-confusion&p=3092305&viewfull=1

[MikeBigg]

Thanks, Rebel, interesting reading, but not as positive as I'd hoped.

 

This bit of law:

Social Security Administration Act 1992

Miscellaneous

Certain benefit to be inalienable

 

quote in reply 14 of the thread you mention seems to be largely ignored by the banks. Their excuse being that they weren't to know it was benefit money as they weren't told.

 

A letter of appropriation seems like it would stop future charges being taken from benefit money, not get a refund of amounts taken in the past.

 

Have I summarised the situation properly?

 

Thanks,

 

Mike