NatWest - No Credit Agreement, so Natwests takes my Money from my current account without my consent!!!

[tem19]

Does anyone have any advice? Natwest defaulted on my CCA request 3 months ago and said they couldn't find the agreement (a £15k loan taken out 6 yrs ago) but were still entitled to the £15k they said was outstanding on the Cap & Int loan account they had set up. The loan doesn't even exist on my credit report. I cancelled my Standing Order 3 months ago after they said they couldn't comply with the request. Trading Standards agreed I had no obligation to make payments to them. OFT pretty much said the same until they produced a true copy of the agreement. Financial Ombudsman took the Bank's side (though I've got till tomorrow to refer it to the Ombudsman). Their debt collections department sent a Notice to me with a letter and I replied to them in detail and explained to them the situation.

 

Today I checked my account and found that NatWest had taken £820 from my current account (making me over £500 overdrawn) and had transferred it to the capital and int loan account without my consent! When I spoke to a guy from the Debt Collections Dept they claimed they had a right of 'set-off'. He said he would be consulting his legal department and would get back to me tomorrow. Could anybody advise on what course of action I should take? Surely they have no right to do this! These guys have stopped me from being able to buy any Christmas presents, let alone pay my mortgage!

[cerberusalert]

Have you read through http://www.consumeractiongroup.co.uk/forum/hsbc-bank/120202-can-hsbc-take-money.html and the other links at the bottom of this page?

 

and in particular issue 27 - banking - direct debit guarantee

Edited December 18, 2008 by cerberusalert
Addition

[tem19]

Thank you very much for that cerberusealert, I will take a look at that now.

[slick132]

Hi Tem - I'm replying to the PM you sent me.

 

If this was me and they'd said they had no Credit Agreement, then off-set money like this, I'd want to kick up the most unholy stink NW had ever seen.

 

However, this is always the risk if you have related a/c's. Whether the right of Off-Set is proper in your case, where they have no Credit Agreement, is not so important. The relevant thing is - Can you get the money back or the transaction reversed.

This is where you need to open a parachute a/c and get your money credited elsewhere so NW can't get there mits on it. Get the parachute a/c sorted first so you can protect your money from now on.

 

Then see if you can get NW to accept they should not have taken this money while the a/c is in dispute and they've failed to produce the Agreement.

[tem19]

Thanks so much for taking the time out to reply to my query Slick132. The worst thing about it is, I did everything you suggested (opened up a different account, moved my money). They had actually returned the money to me initially on 21 Dec so I made sure that the current account balance was zero. Then they refused to close my current account 'because it is linked to the disputed loan account' (although they are separate accounts) I cancelled all direct debits etc and asked the collections dept (over the phone) to cancel the overdraft on 23 Dec! They actually confirmed (over the phone) that this had been done and that it would show within 48 hrs! So you can imagine my shock that not only had they lied about cancelling my overdraft, but that they taken the monies again, then set up a standing order without my consent and took even more, leaving me massively overdrawn! This is despite the fact that the Ombudsman has not even been allocated to make a final decision about my complaint! I'm just like 'wow, if only they put all that energy into finding the CCA agreement, or complying with my SAR'. I think they have deliberately not been recording my calls, so that my cancellation request is not on record. Secondly, if my current account was not overdrawn at all on 23rd Dec (it certainly is now), I'm not even sure whether they were entitled to block me from closing it?!?

[womble72]

Hi Tem19,

 

The true copy they sent you had your signature on the paperwork ?

 

Reason is because the Natwest sent me a true copy but people on this site had a look at it and said it wasnt a true copy and something the Natwest cobbled together.

 

Now if they cant find your agreement they cant enforce the debt.

 

Can they ?

 

Womble

[tem19]

Hiya Womble72. NatWest didn't even send me a true copy! They've sent me nothing apart from bank statements from 2002 & 2003. They haven't even thrown something together in my case. So I don't quite understand how they think they're entitled to do what they're doing! Their debt collections dept sent me 2 notices purportedly under the CCA (most recently on 24 Dec when they took my money for a 2nd time) when I had already written to them in Nov asking how they could send a notice under the CCA when no agreement exists. Now the debt collections dept are refusing to speak to me and I've been told to write to their 'Ombudsman service'. I really want to pursue them, but I'm not sure of the best way. I am totally disillusioned with the FOS.

[womble72]

Hi Tem,

 

Sorry i cant give you advice but someone on here should be able to guide you.

 

I have paperwork from them claiming to be a true copy but i just think they r trying it on so if anybody can give tem solid advice that would be great.

 

Kind Regards

 

Womble

[slick132]

Hi Tem,

 

I'd get onto the bank again on Monday to complain that what was clearly agreed with one dep't has not been complied with by another.

 

They are out of order changing what was agreed, taking unauthorised pay'ts without proper notice and leaving you so badly overdrawn.

 

Tell them you'll take this back to the FOS with formal complaints if they don't sort this out immediately.

 

It may not work but I don't see what else you can do. Try and speak to the FOS and see if they can help at all.

[tem19]

Thanks guys. Will do that. I've also drafted a detailed letter to the FOS cataloguing the bank's actions.

[tem19]

Hi guys, just received a response from Trading Standards today to the original complaint on the 18th December. Please see below and let me know what you think.

 

Dear Ms. XXXXXXXX,

I shall start by answering the explicit questions you pose.

“…therefore does the right of set-off apply to a non-existent loan agreement? Do NatWest have the right to take £820 from my current account without my consent, leaving overdraft and interest consequences, and do they have the right to resume a standing order that I cancelled with written notification? Do any of these actions amount to unfair trading practices?”

The consequence of Nat West being unable to produce a copy of an agreement with you is that it does not have the right to do many things that it would otherwise be entitled to do. It is unlikely that the agreement is non-existent as banks are not in the habit of advancing money to borrowers without ensuring that all the paper formalities have been completed. At no point have you denied that you received the money. However, if the agreement does exist, then the bank cannot enforce it for reasons that we have explored in previous emails. This means it does not have a right of set off in relation to the sum it is claiming and did not have a legal justification for its action in transferring money from your current account. Even if there is something in banking law that appears to give the bank the right to revive a cancelled standing order, it could not operate to give it a right that is explicitly removed from it under consumer credit law. Having said this, your case is very unusual in that it displays a pattern of unlawful acts that are, arguably, not unfair. The reason is that you have never denied receiving the money and it cannot reasonably be supposed that it was ever the bank’s intention to make you a gift of it. In terms of the normal concept of “fairness”, it is fair for you to repay money you have borrowed. In this case, the bank, as a result of its own negligence in losing your agreement, cannot compel you to repay this money and has no legal basis for any steps directed to that end. There are good reasons of public policy for the law being as it is but it does mean that sometimes a person who has borrowed money can be freed of the obligation to repay it with some consequent “unfairness” to the bank.

I should like to take this opportunity to anticipate another point you may make. As has been mentioned in earlier emails, section 77(4)(b) of the Consumer Credit Act 1974 provides that if the default in providing a copy of the agreement continues for one month, the lender commits an offence. I have discussed with my Team Leader whether it would be appropriate for us to investigate this aspect of the matter. Our conclusion is that it is a virtual certainty that the bank could successfully avail itself of the defence provided by section 168(1) of the Act. We do not believe that there is any evidence that the agreement never existed and the overwhelming probability is that it exists but has been lost. This is clearly a “mistake” in terms of section 168(1)(a) of the Act. As for the second limb of the defence, set out in section 168(1)(b), the bank would simply have to demonstrate its system for keeping details of agreements and that it was very rare for it to lose such details. This would constitute evidence of reasonable precautions and due diligence.

If you wish to prevent the bank from removing further sums from your current account I suggest you seek an injunction to this effect. If you wish to recover the money it has already taken, I suggest you write to the bank giving it a deadline to return the money and informing it that you will take action in the County Court to recover the sum if it fails to do so.

Yours sincerely,

JXXX SXXXXXXX

Haringey Trading Standards

[volvodriver]

Having said this, your case is very unusual in that it displays a pattern of unlawful acts that are, arguably, not unfair.

 

I'm no consumer law expert, but I do understand English, and this is nonsense. Trading Standards exist to enforce the law, not to decide what aspects of breaches of the law may or may not be fair. There is NO argument to support the claim that unlawful acts might not be unfair.

 

I would send this reply to the head of your local Trading Standards for clarification, I also might enquire of my MP why enforcers dont know their remit.

[tem19]

Those were my thoughts exactly Volvodriver, I'm glad you are thinking the same thing because I was really starting to doubt myself. I did send the guy at TS a reply but now I think I was too nice:

 

"Thank you very much for your email of today's date. Since I last emailed you, there have been some further recent developments, which my attached letter to the financial ombudsman lists in detail, and are too exhaustive to repeat here. I welcome your coments on the points made in that letter with regard to NatWest's recent actions.

 

With regard to the issues raised with regard to fairness or reasonableness, I totally understand that, as I did receive the £15,000 back in 2002, the banks will claim that I should pay it back and under normal circumstances I might even sympathise with them. However I know for a fact that not only do banks not lend sums out of the kindness of their hearts, but the terms of repayment that they purport were not agreed by me and if (which is disputed) they were, then NatWest themselves have not adhered to those terms. This is why I so much want to see a copy of the agreement and illustration myself and I fail to understand why they have not at least complied with my subject access request so that I could at least see more information than just some bank statements in respect of this issue. Just like the bank will claim that it is 'fair' or 'reasonable' to take these unlawful actions in respect of what they believe is owed to them, I also believe it is 'unfair' that they should charge interest on those sums at a rate that was not agreed or claim there is a valid agreement yet fail to produce any documentary evidence of this agreement being made. I do not believe they have demonstrated thus far that the agreement exists - bank statements to me do not constitute enough evidence, although I do understand your doubt that a bank would lend sums without such an agreement being in place - you certainly would think that a bank holding a consumer credit licence would ensure that they did so. I also recall a BBC online article late last year concerning NatWest which shows that their 'losing' agreements is by no means a rare occurence

 

As advised, I will write a letter to the Bank giving them a deadline to return the sums taken from my account. I thank you once again for taking the time to reply and welcome your comments on the issues raised in my letter to the Ombudsman.

 

Yours sincerly"

[slick132]

Hi Tem,

 

It's unusual, in my experience, for TS to involve themselves to this degree and express opinion like this but I'm not sure if this will be of any practical use in your case. The bank are unlikely to pay much attention to TS's opinion and would be likely to take the FOS seriously.

 

So I doubt arguing the toss with TS about how often banks fail to produce credit agreements, etc will help you.

 

Have you contacted the bank yet to voice your anger at their actions.

[volvodriver]

So I doubt arguing the toss with TS about how often banks fail to produce credit agreements, etc will help you.

 

I think there's a bigger issue here Slick, which you are not addressing.

 

TS have committed drivel to paper. What they have written is not just plain wrong, its totally indefensible, and the writer, and the organisation which allowed him/her free reign to write it should be brought to the attention of the council who fund them, and the MP in who's constituency they pen fairy tales.

[tem19]

I am writing the Bank a very harsh letter before action as we speak. I will also call up these guys again tomorrow - more speceifically the lending and debt collections depts and I'll keep you posted on what the responses are. I did send a very detailed complaint to the Ombudsman about these actions.

[slick132]

Hi Volvo,

 

I didn't mean in any way to be dismissive of your comments in post #12.

 

You may be right, but arguing with TS at the mo is not, IMHO, going to help Tem resolve the most pressing issue which is with the bank.

 

If Tem wants to take this up with TS at some stage, that's fine but I don't believe it will help Tem with the immediate bank problem.

[tem19]

Hi guys, I called the customer relations unit and wrote them a stinker of a letter before action yesterday demanding they return the monies, close the overdraft and confirm that they wont set up another standing order within 7 days or I will commence county court proceedings and seek asn injunction without further reference to them. We'll see what their reply will be, probably 'so what if we can't produce an agreement, you borrowed it so we're entitled to do what we're doing' or 'look what happened to the Rankines'. I'm still very tempted to bring their actions to the Court's attention anyway, what have I got to lose?

[tem19]

Just an update on developments. The team leader of Haringey TS wrote to me after I raised the grievance brought up by Volvodriver. Hear is what he wrote:

 

"I am writing in response to your email of 5th January, in which you ask for my observations on Mr Sxxxxxxx's remarks.

 

Mr Sxxxxxxx and I have discussed this case at all stages, and so I have seen all the correspondence.

 

The point that Mr Sxxxxxxx was trying to make was the general one that the courts will always be mindful of the fairness of conduct by parties when passing judgement, although he and I fully appreciate that their freedom of manoeuvre in this case is limited by the provisions of the CCA.

 

I hope this clarifies the situation and I apologise for any misunderstanding which may have occurred.

 

Yours sincerely

 

P. XXXXX"

 

Sounds like utter tosh to me. I don't think NW's conduct could be described as fair. If that's the case why the heck do they bother to hold a consumer credit agreement? Any comments welcome.

 

But more importantly, after my threatening letter Natwest have seen it fit to return £820 on Jan 13 but not the other £271 that they took on 30 December (the standing order they set up without my authorisation) Thus my account is still overdrawn and obviously they haven't cancelled it. They're probably finding this amusing but I'm not so amused. They haven't responded at all to my letter and who wants to bet that they'll set up another standing order without my consent. Still no cca, still defaulting on my SAR. I welcome any thoughts/ suggestions on what I should do about this?

[slick132]

Hi Tem,

 

Very glad to hear they've refunded some of the money.

 

You've obviously got their attention but you'll have to keep on at them to get the £271 properly sorted.

[tem19]

Yes Slick, it's a big relief that they returned some of it, and many thanks for the advice. I'll get on to them asap about the £271/closure of the overdraft and let you know what happens.

[2Grumpy]

NatWest are dreadful. They think that they are above the law. If they don't have your CCA they usually invent one.

 

They do the offset to an overdraft so that they can transfer their unenforcable loan to one they can enforce. Otherwise there is no point to what they are doing - they would just be re-arranging the deckchairs on the Titanic..

 

This is a very cynical attempt to get round their poor banking procedures.

 

OFT regulations say that they shouldn't encourage you to take out a loan to make payments, but here they are forcing precisely that when they don't even have the right to ask for payment

 

No CCA = no right to ask for payment

 

When they said that they don't have the CCA but you still owe the money - that was their first mistake - because if you owe the money but they can't ask for payment, do you really owe it?

 

Kick them with everything that you can

[sosumi]

tem, did you get a current account from another bank?

[tem19]

Yes Sosumi, I set up another account and transferred all of my money to it, making sure I left a balance of little more than zero. thus the only money they've been able to get at is my overdraft, which I had asked (and they agreed) to close!

 

My sentiments exactly 2Grumpy. NatWest really are amongst the lowest of the low in terms of the lengths they go to. Does anybody think I should do a CCA request under CPR Part 31? I've read some other CAGers talking about this and wondered what people thought about this strategy?

[sosumi]

Hi tem,

I'm sorry to keep repeating, I appreciate what you're saying but was your new current account with a different bank, or with Natwest? I'm just worried that if you're only banking with Natwest, they will dip into your money and you'll be broke and fighting them forever!