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Alliance and leicester fined by FOS for retaliatory account closure
The Ombudsman has just adudicated in a complaint against the A&L on a complaint that they closed a customer account in response to a claim for bank charges.
The fos decided that the closure was indeed unfair as it was punitve and retaliatory.
The awarded £125 against the bank.
this is a derisory figure of course but the ruling is highly significant.
If you have had your accont closed by any bank because you have cliamed bank charges - or if you have been threatened with account closure then we suggest that you begin an immeiate complaint to the Ombudsman.
You will have to get a final decision from your bank first.
The more complaints which are made, the more likely the banks are to stop this vindictive and churlish treatment of their customers.
Please don't pm me about specific questions unless you have posted and it has not been dealt with or unless the matter is confidential. Please include a link to the post you want me to look at. If you have received a defence, contact me.
Advice & opinions of BankFodder, The Consumer Action Group and The Bank Action Group are offered informally, without prejudice & without liability. Use your own judgment. Seek advice of a qualified insured professional if you have any doubts.
Re: Alliance and leicester fined by FOS for retaliatory account closure
I have a copy of the decision. The complainant will himself be putting up a thread in the next few days and the press have just been informed.
I suggest that anyone wishing to complain do so immediately - even if one threats have been made.
Once people get to know about this there may be a bit of a rush and a backlog may develop.
Unfortunately you will have to exhaust the bank's procedures first so it is all timeconsuming.
Still, make the complaint anyway. It creates additioanl pressure and additional awareness - and of course if there is £125 going then it is better in your pockets than in theirs - but you know that, don't you!!
Please don't pm me about specific questions unless you have posted and it has not been dealt with or unless the matter is confidential. Please include a link to the post you want me to look at. If you have received a defence, contact me.
Advice & opinions of BankFodder, The Consumer Action Group and The Bank Action Group are offered informally, without prejudice & without liability. Use your own judgment. Seek advice of a qualified insured professional if you have any doubts.
Re: Alliance and leicester fined by FOS for retaliatory account closure
I am so glad that the fos are finally coming under pressure to pull banks up on this matter.
Clearly in breach of FSA regulations regarding "treating customers fairly".
I think I will be including the ruling in all futute correspondence with the banks that I am dealing with!!!!!
Re: Alliance and leicester fined by FOS for retaliatory account closure
Originally Posted by BankFodder
If you have had your accont closed by any bank because you have cliamed bank charges - or if you have been threatened with account closure then we suggest that you begin an immeiate complaint to the Ombudsman.
You will have to get a final decision from your bank first.
.
Isn't that a contradiction in terms?
Regardless, and even though they haven't closed the account so far, I have plenty of evidence against Halifax that they use the threat to try and dissuade people, so that's going to get done ASAP.
Thanks for that information, BF. ;-)
Apologies to people who I was in the process of helping, I may be gone some time.
Re: Alliance and leicester fined by FOS for retaliatory account closure
Great to see this and am anxious to learn more. HSBC have threatened to close my husband's account and asked for all cheque books, etc. back by mid Feb. This was in answer to us claiming back bank charges. Any direction would be greatly appreciated in complaining to the Ombudsman.
Re: Alliance and leicester fined by FOS for retaliatory account closure
Originally Posted by Tracey284
Great to see this and am anxious to learn more. HSBC have threatened to close my husband's account and asked for all cheque books, etc. back by mid Feb. This was in answer to us claiming back bank charges. Any direction would be greatly appreciated in complaining to the Ombudsman.
Fos Uphold My Complaint Against A&l - Account Closure Unfair, Punitive & Retaliatory
Dear Forum,
The Financial Ombudsman has awarded me £125 compensation as a result of the treatment I received from Alliance & Leicester when they forcibly closed my account after I sued them.
It was not the Adjudicators place to comment on the merits of the original action but nevertheless I was entitled to bring as is my legal right under consumer protection legislation and common law. Consequently Alliance & Leicester are not treating their customers fairly by deliberately deterring such actions with the threat of account closure.
I quote verbatim,
"He should not be prevented from bringing a legitimate complaint by the threat of having his account closed; nor do I consider it fair or reasonable of Alliance & Leicester to respond to his complaint about charges by closing the account. Alliance & Leicester appears to me to have used the closure of the account as a retaliatory or punitive measure".
Suffice to say that this decision was far more satisfying than the £200 I claimed back for bank charges back in June 2006.
The key thing to remember is that you have to exhaust the complaints procedure with the firm first of all before you refer to the fos. You must obtain a 'Final Decision Letter' from the firm that states they cannot do anymore with the complaint and that if you remain disatisfied you can refer the matter to the Financial Ombudsman within 6 months - this is crucial.
The FSA rulebook defines what a 'FDL' is and so it must contain these magic words in order for your complaint to be heard by the FOS.
Re: Alliance and leicester fined by FOS for retaliatory account closure
Hi there,
just stumbled across this thread.I recently asked First direct to refund charges, which they, after a lot of secure messaging back and forth, at last have done.ut their last message to me was following:
Message From Bank
-----------------------------------------------
Operator ID : xxxxxx
Date : 04/01/2007
Subject : Account Management (debt management)
Dear jellybabe
I'm sorry you've felt the need to write to smile about the charges applied to your account and about the time it's taken to reply to you.
After reviewing your complaint a refund of the charges applied to your account has been agreed. As such, a total of £140.00 has now been returned as a gesture of goodwill.
I have also adjusted the charges that you will receive notification of on 05/01/07. Please ignore this notification as the charges will not debit your account. Could I please bring to your attention that we will not refund any further charges unless there has been a bank error. Any further requests for a refund (unless bank error) may result in us giving you 30 days notification to close your account.
At this stage we are required to let you know that smile will regard the complaint as closed if we do not receive a reply within 8 weeks of this response.
If you remain unhappy you may ask for your complaint to be referred to the Financial Ombudsman Service. Full details are on our website, Redirecting to Smile Production Site / talk to us / complaints.
Yours sincerely,
Jane Cliff
smile Customer Services Manager
well, now i just been informed that they try to charge me another £30 in unauthorised O/D charges, because it took them a week to put the money back into my account, and by then ,of course, the new statement date has passed.
Any advice on what i could do? I don't want them to close my account as i have £500 O/D and won't be able to pay it all back in one go.
Thanks in advance for any advice given.
Re: Alliance and leicester fined by FOS for retaliatory account closure
Much thanks for posting this excellent news. This is a great victory, and I am quite surprised that the Ombudsman actaully made a decent decision.
If you found this post useful please click on the scales above.
Egg - £400 - Prelim sent. On hold.
Mint - On the list Est £800
GE Capital - On the list (3 accounts!) Est £4000
MBNA - £545 Prelim sent 13/11/2006
LBA sent 1/12/2006
£350 partial payment received 18/12/2006. Full settlement received 20/1/07
NatWest - Est £4000 not incl interest
Data Protection Act Sent 10/1/07
Statements received 24/1/07
Prelim sent 3/2/07 Full Settlement received 22/2/07
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Re: Alliance and leicester fined by FOS for retaliatory account closure
Complaint now on its way to Nationwide with copies of the required letters. It really does pay to send everything recorded and only deal by letter...
Lets see what happens.
If I have helped click my scales....
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Re: Alliance and leicester fined by FOS for retaliatory account closure
Originally Posted by BankFodder If you have had your accont closed by any bank because you have cliamed bank charges - or if you have been threatened with account closure then we suggest that you begin an immeiate complaint to the Ombudsman.
You will have to get a final decision from your bank first.
.
Originally Posted by Bookworm
Isn't that a contradiction in terms?
Regardless, and even though they haven't closed the account so far, I have plenty of evidence against Halifax that they use the threat to try and dissuade people, so that's going to get done ASAP.
Thanks for that information, BF. ;-)
That's the 8 week thing, (put the complaint in writing blah blah, wait for 8 weeks to hear nothing or be fobbed off) the ombudsman are very meticulous about this as i found out recently. I was even asked by the ombudsman to send a letter telling them the 8 weeks had expired. HSBC closed my account.
This is truly great news.
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Re: Alliance and leicester fined by FOS for retaliatory account closure
Lloyds has sent me a closure letter in July, then changed their mind after I spoke with my account manager. Then, in December, after settling my second claim, they have cloed my account, with balance transfered towards my personal loan, without notification, without my agreement or even a courtesy note. I am furious and wrote:
I find it exceptionally disappointing. It is an implied term of the contract between the firm and its customer that the firm will not normally close the customer’s account without giving reasonable notice. The Banking Code says that, in normal circumstances, firms should give customers at least 30 calendar days’ notice before closing their accounts.
You have not given me such notice and a previous notice has been rescinded by the Bank.
Your decision has caused me great anxiety and inconvenience. The fos is likely to require the firm to pay compensation .(FSO News, issue 48, August 2005 “banking: when a firm decides to close a customer's account”).
Additionally, around the times of the above mentioned correspondence, the account was in dispute and I have issued a legal action, twice, against your Bank with regards to unlawful penalty charges. The Bank has settled on both occasions. After the first settlement you have threatened with me an account closure but after I spoke to one of your regional managers, we agreed to keep the account open in order to service the personal loan account. After the second settlement you have not even informed me that you have decided to settle my claim in full and you have closed my account. I have checked my account by complete coincidence and realised that you have refunded the money. I was lucky to check as the very next day (or even on the same day; I cannot check anymore because you have not even send me the final statement)- you have closed my account.
I could therefore argue that you have closed my account as a malicious, disproportionate reaction to my “penalty charges” complaint.
You have acted against an advice of your own professional body;
The Banking Code Standards Board .
You may want to note that the Ombudsman has just adjudicated in a complaint against the Alliance & Leicester on a complaint that the A&L closed a customer’s account in response to a claim for bank charges.
The FOS decided that the closure was indeed unfair as it was punitive and retaliatory. The FOS awarded £125 against the bank.
I am confident I would be able to convince the Ombudsman that I have been affected in a similar way by your decision.
I now request that you issue me with a 'Final Decision Letter' as I intend to take me complaint to the Financial Ombudsman.
Re: Alliance and leicester fined by FOS for retaliatory account closure
Yes I also asked for some clarification on this and got this reply from Emma Parker of the fos.;
"We can and do look at complaints about difficulties in opening bank
accounts - just as we look at complaints about banks closing accounts.
Often these complaints involve other aspects and issues too - for
example, where the consumer has financial difficulties, and problems
have arisen in the relationship between the bank and the customer over
a
period of time. This is why we have to look at each case on an
individual basis, to see whether and how we can help given the
particular circumstances.
In the first instance we tell consumers to give the bank or building
society an opportunity to investigate the complaint and sort out the
problem. If this doesn't work - or you're not sure who to get in touch
with at the bank - you can contact us free for help on what to do next."
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Alliance and leicester fined by FOS for retaliatory account closure
decided that the closure was indeed unfair as it was punitve and retaliatory.
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Originally Posted by BankFodder
