The Co-op - a different bank charge issue...

[davjoh]

Here's a letter I just typed up to the bank. Pretty self explanatory. Only posting it up because it shows how shoddy even banks can be at drawing up contracts without holes (like we didn't already know that...)

On XXXXX you attempted to take a bill payment instruction from my above referenced account to pay XXXXXX, in the amount of XXXXXX. This transaction was reversed on the basis that I had insufficient funds in my current account at that time for the payment to be made. As a result of which, you levied a fee against me of £35.00 on the same date, and notified me of the same by letter.

It is my position that you have no contractual entitlement to charge this amount. The schedule of account charges for the current account provides the following:

“Unpaid items – this charge may be applied if cheques, standing orders or direct debits cannot be paid due to a lack of funds or where you used a cheque guarantee facility or Visa debit card to create or extend an existing overdraft.”

The payment that was attempted and subsequently reversed was made by bill payment using internet banking. The schedule of charges does not provide for a fee to be levied if a bill payment cannot be paid due to lack of funds.

You cannot state that a bill payment is a form of standing order. The bank, in the help pages of the internet banking service, defines a standing order as:

“a ‘standing order’ is a regular payment which debits your account in specified amounts.”

The help pages define a bill payment as:

“this is a facility that allows you to make one off payments for your household bills or credit card payments etc.”

It is clear that these two payment types are completely separate by definition and, in the absence of a clause to the contrary, reference to the first in the schedule of charges cannot be taken as a reference to the second. You have therefore, without lawful or contractual authority, debited against my account a fee to which you are not entitled. This amounts to breach of contract, and may amount to an offence of fraud by abuse of position, contrary to the Fraud Act 2006.

What I require you to do now

I expect you to make:

1. A full and immediate refund of the sum debited from my account

2. A full written apology and an undertaking not to breach the contract again

3. A reasonable offer of compensation for breaching the contract

If you do not, it may be necessary for me to either rescind the contract, in which case I would seek the additional costs of finding and establishing a new account, payment to reflect the damage that doing so would do to my creditworthiness, and any other reasonable costs, expenses and damages (including punitive damages); or to take you to court for the breach; or both.

I look forward to your written response no later than XXXXXX. If you do not respond within this time I will progress this matter as summarised without further notice to you.

I can't wait to see what they say to this. I'm hoping and pleading I get an "the FSA says we don't have to respond to bank charges disputes letter" - the fun I could have responding to that!

(apologies - its 3am and I'm hyper on the pepsi. wheeeeeeeeeeeeeeeee)

[Guest vortex]

If it was an online payment, ie you made it with your online banking facility then it should not have been made due to insufficient money being in the account. Minor point of error: the company would make a request for payment if it was a direct debit not the bank. Can you clarify that the payment was an ONLINE transaction and that the charge was for that and not the first payment of a direct debit because I am aware of no banks that will charge you if you initiate an online payment through the account when the money is in the account.

[davjoh]

Can I have that in English please, Vortex?

[Guest Gertie100]

Was it a direct debit?

Or an online banking transaction?

[davjoh]

Internet banking bill payment. It does say in there...

[Guest Gertie100]

So whilst online paying the bill, was there enough money in the account?

 

Internal banking bill payment - do you mean an arrangement you set up via internet banking to pay a certain amount each month to the same supplier? Eg. Electric, gas, credit card?

[mcjohnson]

Gertie,

 

I also use this "online bill paying service" with my bank (A&L). Whilst it appears, from the customer-interface, like a completely seperate process to direct debits and standing orders I believe that the banks process these payments in exactly the same manner as a standing order. FYI the payment is an "ad-hoc" payments system, users can deposit variable numbers and values at dates of their choosing. These are completely different to both Standing orders and direct debits in their behaviour as transactions.

 

Thus the payment isn't taken at the immediate moment you press the magic button, but is (I am speculating) added to a batch job by the bank, and processed later in the day (or on the day the payment was scheduled for). Consequentially the funds do not necessarily have to be in the account at the time the payment is arranged. Further evidence is available because you can select the date the payment is made, thus indicating that these jobs are simply "added to the queue".

 

This is probably why the bank believe that they are entitled to levy the charge, however I completely agree with davejoh, that this payment is offered as a seperate service, aside from Direct Debits and Standing Orders. The bank should have therefore been more thorough in drafting their terms and conditions, to ensure that these items are covered. based on the information provided it certainly seems they are not.

[Guest Gertie100]

Ahhh right - when I use this service with my bank it shows the money being taken from account straight away - I guess this was the point I was making!

Whilst the principle of the complaint is easy to agree with I feel the banks response may be along the lines of, why did you arrange to pay this bill for a time when you didn't have any money in the account?

 

Don't all shout at me - I'm not saying that I think the charge is correct etc etc. just speculating...

 

Davjoh - keep us up to date please.

[davjoh]

I inputted the incorrect amount - one too many zeros. I could try and ask them politely, but feel I'd be wasting my time. Besides, getting them over a barrell seems like fun...

[dx100uk]

you can change the amount paid if you made a mistook on the co-op site.

just select the same payee again from the list, if the payment has not been processed [normally 2 days] you can change it.

 

if it wont allow that phone the usual banking number [212212 etc]

and get themn to do it, there is no charge.

 

dx100uk