Account Closures?

[ppauls150]

Hello all.

 

I have tried doing searches for information on where the banks are closing accounts down and how they cannot really do this under the banking code and so forth. I found a very good thread which i am watching of Sarahk. I also came across another thread where there was something about someone trying to do a test case on this from happening dont know if they were talking about Spiceskull on that but it also had a link to that thread where the link didnt work. As well as this though i was wondering if any of the bank staff on here has any information as to if there is anything they know of regarding these issues.

 

I know that this can be part and parcel of claiming back your bank charges and that you should expect it but what this bank have not really looked into is the way the charges that was claimed back was their fault in the frist place even though that the charges had to be claimed back through the letters as they didnt look into the account as to why the charges started ( which was the banks fault) now they are saying due to you claiming your charges back ( but we dont realise it was our fault cause we havent looked ) we will be shutting your account down in 30 days. the ammount claimed back also was practically nothing aswell.

[cariad mo brwydrwr]

As far as I know, banks close accounts because they believe that the relationship between the customer and the bank has irretrievably broken down. In other words, you won't play the game by their rules so they don't want to play with you any more.

 

There was a bit in the Banking Code Standards Bulletin in July (sorry if you've already seen this):

 

Banking Code Standards Board Bulletin ......... No. 21 ........... 27 July 2006

 

i. Account Closures

 

There has been media coverage recently of a small number of subscribers [to the Banking Standards Code]that are, or alleged to be, operating a policy of automatically closing the accounts of customers who have brought court actions against them for the recovery of default charges. The account closures are, to the best of our knowledge, being effected after due notice has been given under the requirements of Banking Code section 7.5 and after the subscriber has refunded charges, either in out of court settlement or having had a judgement against it.

 

We ask subscribers to consider very carefully the fairness of closing accounts in such circumstances, taking into account the individual circumstances of each case, to ensure that it is not a disproportionate response.

 

Without deliberately using threat of account closure to deter a customer from pursuing a complaint or exercising his or her legal rights, subscribers should make sure that the customers are clearly alerted at an early enough stage in any dispute, if account closure would or will be a consequence of starting court action, and if this is the case this should also be made clear. We note that the subscribers concerned have explained the account closures as a response to the evidence that the relationship between customer and bank has broken down, with the customer refusing to abide by the terms and conditions of the account. [Funny how it never bothered them before that customers weren’t abiding by the Ts & Cs, when they were making loads of £££s out of it!]

 

Customers who are in financial difficulties must be treated sympathetically and positively in accordance with the provisions of Banking Code section 14. Even if debts are written off alongside default charges that have been challenged in court, such customers may have severe difficulties in finding alternative banking arrangements; this should be an additional consideration when determining whether it is appropriate or fair to close the customer’s account, or even to notify the customer that this is a possible consequence of court action.

 

Concerns have been raised with us at the possibility of adverse Credit Reference Agency reports being filed on customers whose accounts have been closed as a result of court action to recover default charges. We have not seen evidence that this has occurred, and we rely on the attention given by both subscribers and the CRAs to conducting fair processing] under the Data Protection Act to ensure that customers are not unfairly harmed in this way.

 

 

Hope this is helpful I'd be interested to know what threads you're following about this too, as I'm worried about my account being closed because I have a big overdraft and bad credit history, so opening another account is proving to be difficult

[pugsley]

would be interested in the credit card issue too, as both my credit cards went into default and were cancelled during the current dispute.

[MARTIN3030]

The banking code only gives guidance and does not lay anything firm down.

Ultimately the decision lies with the Manager.

Personally I think anyone who makes a claim and then carries on as before even after getting warnings is clearly asking for it.

Though this is just my opinion.

On the question of account closures......yes there has been lots of losses but where there is a loss someone else has gained so its been pretty much swings and roundabouts.

I think it will take some time yet before the Banks are able to evaluate,since the situation is ongoing and has by no means peaked yet.

We can be sure that they will be seeking to shore up the shortfalls in profits by seeking to recoup these from both other areas,and the introduction of flexibility.

Someone will undoubtably have to pay for the refunds......and its not all just about the money thats been refunded....but additionally the costs borne out during the process,which £ for £ could equal the actual refunds themselves !!

[ppauls150]

This is what i have put together and going to send it and see what happens. I know it is usually best to change bank accounts anyway once you have made a claim and if they shut it then so be it. But i want it shut on my terms and not theirs. What would be best is for them to back down and then go in there and tell them i want to shut it down lol it is just the principle of the fact tbh.

 

Ref: Threaten of closure of my account.

 

Dear Sir/Madam

 

I am writing in regard to your letter dated xx/xx/xx and simply cannot believe that because I made a complaint to yourselves what you did not like, you are deciding to close my account. I have read recently that the OFT have criticized you for doing this with anyone who raise complaints with you that you do not like. Where is the justice for everyone the right to appeal on the grounds that you were acting unlawfully?

 

Obviously you did not read my letters I sent to yourselves with regards to why I was making the claim in the first place. When my first ever charge was applied to my account for paying something when I didn’t have sufficient funds you charged my account a fee for this which took me over my limit. Due to this being my first ever charge I spoke to my branch who understood that this was the first charged I have ever had and reversed the charge back for a first offence. What they forgot to do was also cancel the charge was hidden away on the system which was for when the account went overdrawn when the first charge was issued which was reversed. If this first charge wasn’t issued then I would not have gone overdrawn and incurred the overdrawn charge. So due to this that got applied the following month which I didn’t know about as I thought that it was all reversed I didn’t expect the charge there which again took me overdrawn the following month and this just carried on every month after that.

 

So like I say if both charges had been cancelled which was on the system and not just the one, which is what happened, the rest of charges would not have happened. Now like you say if you do have an oversight on an account once in a 12 month period you will refund the charges but you only partially did this due to not checking the account properly so for this spiraling out of control was not my fault.

 

 

Now because of your error in the first place and me having to take severe action to rectify this you are now threatening to take my account away. I believe I have the right to complain without the threat of you shutting my account down if the complaint does not come back in your favour and I am sure that the governing bodies will take my point of view that I should not be scared of making a complaint for the fear of my account being shut down.

 

I will be contacting the relevant bodies to investigate this matter further on my behalf and would like to you wait for the relevant bodies to investigate this matter and for them to reach their decision before look at closing my account. If you are still intent on shutting my account before the relevant authorities can look into this complaint on my behalf then you will leave me with no alternative but to intend to apply for a temporary injunction, to prevent my account from being closed. Once I have received the mentioned notes and details which I have listed below, I will be in a position to decide whether or not to apply for a permanent injunction preventing account closure.

 

 

I am requesting a complete disclosure of all notes applied to my account since 1st January 2006.

Specifically, I require details and notes pertaining to the following:

• The ‘commercial decision’ to withdraw banking facilities from me, including the reasons, figures and decision makers involved.
  
• The bank’s refusal to refund ‘penalty charges pending’ to my account on request, and the subsequent decisions leading to those charges being refunded, notwithstanding the bank’s assertion that the charges are fair, transparent and lawful.
  
• The bank’s refusal to refund ‘penalty charges’ applied to my account on request. After raising the matter in court, and notwithstanding the bank’s assertion that the charges are fair, transparent, lawful and would be defended in full, the subsequent decisions leading to those charges being refunded.

Regards

*EDIT The last part of this letter regarding asking for information was a bit taken from Spiceskull what he sent to the HSBC. He no longer comes on here at the moment so couldnt ask if i could use it but i dont want to take the credit for the last part if it comes in handy for anyone.

[MARTIN3030]

You have obviously spent some time on this and I congratulate you for effort,however it looks a little too much like sour grapes (thats how it appears ) and you really want it to come accross to them in the best way possible so they will take notice.

I also feel it goes on tooo long and could be reworded to say the same for less.

 

Maybe a bank worker could look at it and give an opinion,but thats what I think.

 

I have seen a letter that addresses this situ very well and has been known to work.

My feeling is that you should send that,howvever I am not trying to preach to you but moreover give an outside opinion

[ppauls150]

Thanks Martin. I know that i am probably banging my head against a brick wall but other than trying to get the defaults removed nothing really else i can do so might as well test the water and see if it has any effect. I know the letter can probably do with downsizing but i am not that good with writing letters but also wanted to keep re-iterating to them that they are in the wrong. It is going to take like you say a lot more people claiming charges back before they think hold on stop how far can we keep turning customers away.

[MARTIN3030]

Yes I agree.

I am fairly certain though that the information and help here will enable you to get those defaults removed although I dont know your circumstances.

People who know me on here will tell you that I am not one who particularly advocates manipulating the system where someone has blatantly took the money and run......I know this is not the case for all,but I know this is the case for some.People who think this way I suppose are hard to educate because there has been a system there thats allowed it to happen.

If you have been defaulted and the default was caused because you ran up lots of penalty charges,or lost your job,or went through a bad patch then its justifyable in my eyes to want to try and get out of a hole that was not self inflicted.

I can see you are genuinly trying to resolve things and your resolve will get you results.

One of the great things about this site is the comradship and the will to help eachother......in this day and age thats hard to find but its here as living proof from people who have never even seen eachother.

The number of people who stay around helping,even after they have won their claim is also testimomy to that too.

 

If I can help you at all feel free to pm me e mail.

[ppauls150]

With the Defaults Martin basically they all came about due to taking on more than we could afford so got behind on the payments. When they defaulted we paid them off though within 6 months of being defaulted and they all defaulted around 2001. we have anywhere between 3 to 10 months before they are removed all 4 of them but i feel the interests that we have paid over the last six years has been astronomically high and have suffered more in the last 5 years than ever. We can live quite comfortable now if we can just get the interest down on the loan and mortagage we have but we cant do this if these companies dont remove the defaults off the accounts after suffering already for the last 5 years. The big problem is though now is i am not earning the kind of money i was for the last 6 years and if we dont get these payments down in the next month or two down to resonable rates i can see us losing our house as not being able to afford the high interest payments where without the defaults we will be okay.

 

It is make or break get the defaults removed 10 months early than what they should be taken off with their so called 6 year time span reduce the interest and live ok with no problems or

they dont remove them and we have to look at not being able to keep paying the mortgage and loan due to high interests as we cant get lower interest payments cause of the defaults and then end up getting more defaults for the mortgage and loan for another 6 years and be in the right sh!t.

 

This is why it is important to get these removed early but other than issuing court proceedings which would get them removed as the companies cannot supply or wont supply the information as it was 5 years ago they wont remove them nor will the CRA, and we cant issue court proceedings cause it is £150 a time and we aint got that kind of money.

 

Something will happen sooner or later.

[cariad mo brwydrwr]

I'm no bank worker, and I haven't seen any other letters of this type so I don't know if its totally accurate. but here's what I think anyway, I hope its of some help to you

 

Dear Sir/Madam

 

Re: Closure of Account xxxxxxxxxx

I am writing in regard to your letter of day month 200x. I am shocked to learn of your decision to close my account as a result of my recent complaint. I have recently learnt that the OFT have heavily criticized institutions such as yourselves for taking this action as a result of claims such as mine.

[don’t think you need the next paragraph, its too long!]

I feel that the alleged mismanagement of my account is due wholly to the charges applied by you and not through any fault of my own. I believe I have the right to complain without the threat of you closing my account, especially if the result of the complaint does not come back in your favour. I am sure that the governing bodies will take a dim view of the fact that you are effectively intimidating me into silence by threatening account closure. As a consumer I should not be wary of making a complaint when I feel you have acted unlawfully.

I will be contacting the relevant bodies to investigate this matter further on my behalf and would request that no further action be taken by you until the investigation is concluded. If you are still intent on closing my account before this has been fully explored, then you will leave me with no alternative but to apply for a temporary injunction, to prevent my account from being closed. To this end I am requesting a complete disclosure of all notes applied to my account since 1st January 2006. Specifically, I require details and notes pertaining to the following:

• The ‘commercial decision’ to withdraw banking facilities from me, including the reasons, figures and decision makers involved.
  
• The bank’s refusal to refund ‘penalty charges pending’ to my account on request, and the subsequent decisions leading to those charges being refunded, notwithstanding the bank’s assertion that the charges are fair, transparent and lawful.
  
• The bank’s refusal to refund ‘penalty charges’ applied to my account on request. After raising the matter in court, and notwithstanding the bank’s assertion that the charges are fair, transparent and lawful and would be defended in full, the subsequent decisions leading to those charges being refunded.

I look forward to hearing from you soon.

 

 

Yours faithfully [if you write to sir/madam]

Yours sincerely [if you’re writing to a named person]

 

 

 

make sure you spell and grammar check it all!

[ppauls150]

Lucyec thanks very much for that your a star. That sounds very good to me and that will be the one i send instead of mine lol. thanks again.

[cariad mo brwydrwr]

you're welcome... might have to use it myself!

[jamesrouse]

I have managed to stop my account closure with HSBC with these 2 letters

sent this one first then was told it had been sent to Leeds to be dealt with

Mr David Lewis

Head of Customer Relations

HSBC Bank PLC

Level 36

8 Canada Square

London

E14 5HQ

 

Thursday, 31 August 2006

 

 

Ref: **************

Account ***************

 

 

 

Dear Mr Lewis

 

I am writing to complain about the letter I received from a Miss N Kelly a service quality manager based in Leeds. The letter dated 30th August 2006 tells me that you are going to withdraw my banking services on the 29th September 2006. The only reason I can see that you are doing this is that I have successfully claimed back unfair banks charges applied by HSBC dating back 6 years.

 

I feel that this is an unfair retaliation on your part, which goes against the Banking Code Standards Board who says “We ask subscribers to consider the fairness of closing accounts in such circumstances”. The FSA who under there rules on dispute resolution and complaints say “We would not expect any regulated firm to discriminate against a customer who makes a complaint”. And also the Financial Ombudsman who say “they should not decide to close an account for an improper reason – for instance, because of unfair bias”.

 

I feel that your treatment towards me is in direct contravention of the above rules set by your governing bodies.

 

I have been a customer of HSBC for many years and am truly hurt and upset in the way HSBC have handled this matter.

 

From this letter I would hope that you will reconsider you decision to close my account so that I can continue to bank with HSBC.

 

If this is not possible then I will be left with no choice but to complain to the Banking Code Standards Board, The Financial Services Authority, and the Financial Ombudsman, however I am hopeful it will not have to come to that.

 

 

 

 

A prompt response would be very much appreciated.

 

 

Yours Sincerely

 

 

 

 

James Rouse

 

 

Cc: File

 

So i then wrote to the chairman with this one, and got a letter from alan pretty say account WON'T be closed

 

Mr Stephen Green

Chairman

HSBC Bank PLC

8 Canada Square

London

E14 5HQ

 

 

Wednesday, 13 September 2006

 

 

Re **********************

 

Dear Mr Green.

 

I am writing to you to complain about the closure of my current account on the 29th of September.

 

I received a letter on the 30th of August from a Miss N Kelly saying that HSBC are going to withdraw my banking services on the 29th September for a “Commercial Reason”, I then wrote to Mr David Lewis head of customer relations on the 31st August.

 

I called HSBC today to see whether my letter to Mr Lewis was being dealt with and it seems that it is being dealt with in Leeds and they have a back log of complaints at the moment but was told on the phone the decision can not be over turned and my current account will close on the 29th September.

 

I feel my account should not be closed, I feel it is only being done so in retaliation of me claiming back bank charges.

 

I would like to draw you attention to the following information from the Banking Code Standards Board, The FSA and The Financial Ombudsman

 

The Banking Code Standards Board say “We ask subscribers to consider the fairness of closing accounts in such circumstances”. The FSA who under there rules on dispute resolution and complaints say “We would not expect any regulated firm to discriminate against a customer who makes a complaint”. And also the Financial Ombudsman who say “they should not decide to close an account for an improper reason – for instance, because of unfair bias”.

 

I have been a customer with HSBC for many years and also have business banking, saving accounts, ISA etc with HSBC, and I am deeply hurt and upset by HSBC’s actions.

 

I ask that you reconsider the decision to close my current, if this is not possible then I will be left with no choice but to complain to the Banking Code Standards Board, The Financial Services Authority, The Financial Ombudsman, and contact national newspapers to inform them of HSBC’s actions. However I am hopeful it will not have to come to that.

 

A prompt response would be very much appreciated.

 

 

Yours Sincerely

 

 

 

 

James Rouse

 

 

[cariad mo brwydrwr]

So what were their replies James, if you don't mind me asking? Have you had a definite confirmation that they're not closing your account?

[jamesrouse]

Got a letter from Alan pretty bout a week ago saying he was investigating

 

then today got one from him again saying

 

Dear Mr Rouse

 

I write with reference to your recent letters regarding our proposed closure of your account

 

You will appreciate that under the terms and conditions that apply to your account with HSBC we are entitled to close the account by providing 30 days notice.However, we have considered the further information provided in your e-mails (no e-mails sent just letters) and reviewed the decision that was made. In this particular situation we are willing to allow you to retain your current account, and other accounts with HSBC

It may also be appropriate for you to review your banking facilities to ensure they are adequate for your current needs. You can do this by calling 0800 130 130 or alternatively you can call in at your local branch

Yours sincerely

Signed

Alan pretty

Senior Service Quality Officer

[cariad mo brwydrwr]

Thanks! Nice one for getting that done then... I'm still worrying about my account being closed, but pleased to know there is some defense against that at least.

 

Cheers

[fabianne]

Hi

Great info on this here thread-Barclays threatening to close my business account at the mo-so I will nick the info to use as a guideline in a letter to my dear manager....and then to Court..

Thanks

Fabi

[Guest The Terminator]

I was wondering is closing a bank account due to reclaiming charges an unfair term.

[cariad mo brwydrwr]

Its not a 'term' per se, banks usually cite the reason as being the relationship between them and the customer has irretrieveably broken down as the customer is not abiding by the Ts & Cs of the account. Unfortunately they are entitled to do this. What they shouldn't be doing is closing accounts as a result of complaints, even if they are losing money as a result of the complaint. (Not that it was ever their money to lose)

[sirowealot]

There was a request from pugsley near the top of this thread regarding closure of credit card accounts but it wasn't replied to. Anyone know how we stand on this? All my claims are going to be on credit card accounts, and the last thing I want to do is win my charges back and have them cancel the account and demand the balance... some of them are quite hefty!

[MARTIN3030]

will have a look for you and get back.

[sirowealot]

Thanks Martin.

 

It seems that there's far more claims on here for *bank account* charges rather than *credit cards*, and I haven't yet found anyone who definitively states "got back £xxx from abc credit card company and they did/didn't close the account".

 

If they do close accounts and there's still a balance we owe, how do we stand as far as the card company reclaiming the money back?

[pugsley]

I'm preparing to my balances off my credit cards soon, but luckily they are small, If they were large I would be in a bad position right now. The capital one card means I will have to pay back aroudn £80 after my claim has been settled. I have been defaulted for the whole balance on my credit report but not on the default notice.

[MARTIN3030]

Thanks Martin.

 

It seems that there's far more claims on here for *bank account* charges rather than *credit cards*, and I haven't yet found anyone who definitively states "got back £xxx from abc credit card company and they did/didn't close the account".

 

If they do close accounts and there's still a balance we owe, how do we stand as far as the card company reclaiming the money back?

 

There would be a termination notice issued prior to closure that would tell you that you have x days to pay any remaining balance,and make alternative arrangements for any Standing orders mandates etc.

In July the British Banking Code issued guidelines to the Banks and card issuers.

They suggested that the Banks should think carefully about account closures because a claimant had asked for / got back charges.

On the question of monies owed......if they closed the account with monies owing after the notice period,then they would usually try the recovery through their in -house collections before offloading to a DCA.

iF the amount owed is penalty related then I would send a letter after being advised of a proposed closure stating that they should regard the account as being in dispute,and therefore suspend any action pending litigation.

[sirowealot]

So in a nutshell then, if I take them on and win, and they turn nasty, they could quite easily close the credit card account and insist the money be repaid within 28 days (for example).

 

If that's the case, I'm not sure I can afford to do that... I have a couple of credit cards with £5k+ on them and £700-1K charges on them. But if I claim, I'm still left trying to find £4k+ if they close the account... money I don't have.

 

Anyone got any suggestions?

 

sirowealot