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Getting Smile bank account "divi"

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I discovered by accident that Smile customers who are Co-op members get a "divi". I was given a number to ring and was told that the Co-op I belonged to was the wrong sort!

 

Does anyone know how the amount is calculated? because I found an account from the Co-op (cunningly concealed inside a members' magazine:)) which included an amount from financial services which equates to about 0.1 annual divi on the value of my account.

 

Incidentally the information about the "wrong" Co-op was out of date as I learned from a man with a brain at Co-op membership. The rules were changed 2 years ago.

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I discovered by accident that Smile customers who are Co-op members get a "divi". I was given a number to ring and was told that the Co-op I belonged to was the wrong sort!

 

Does anyone know how the amount is calculated? because I found an account from the Co-op (cunningly concealed inside a members' magazine:)) which included an amount from financial services which equates to about 0.1 annual divi on the value of my account.

 

Incidentally the information about the "wrong" Co-op was out of date as I learned from a man with a brain at Co-op membership. The rules were changed 2 years ago.

 

The only Divis you find there are the people who work there.

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I have had a serious problem with the Co-operative Bank, extremely excessive charges and persistent referrrals to a Debt collection agency (Moorcroft). When I opened my account, I had a good credit reference (which had taken many years to get up to scratch) and was given a Cheque Book account and debit card. Three weeks after opening the account, I was in need of extending my overdraft, which was initially set at £250, as it was coming up to Christmas. I telephoned Co-Op customer service and after a short conversation, was told I was 'entitled' to an O/D of £600.00. I was on a fixed-term full-time contract which was coming to an end in April 2007 and being replaced with a p/t contract.

 

Trying to be responsible and forward-planning, I telephoned the bank one month before my full-time work contract came to an end and the part-time one started, telling them my income was about to be more than halved and enquired if I could have an £800 overdraft limit, on a 'reducing' basis, until I could get back on my feet and pick up some additional work. I was met with point-blank refusal and told that I had to have my account for "at least 6 months" before they could 'consider' an extended overdraft and that 'a reducing overdraft was out of the question'. The fact that they had increased my initial overdraft to £600 after my account had only be open for 3 weeks was apparentlly 'irrelevant'!!

 

Within a month of my income dropping, I started to get into serious financial difficulties, exacerbated by the fact that my partner was taken seriously ill and hospitalised 70 miles away for nearly 4 months and was unable to work. I had no access to his sick pay as we did not have a joint account. Then the charges started - £35.00 and £37.50 plus interest, at a time, taking my account over £800 in the red in a very short space of time. Initially I was lucky in that they agreed to refund £400 as a 'goodwill gesture' however, they continued to charge me, refused to acknowledge my serious hardship and in a short space of time, my account was over £600 in the red again. I decided to try and get my bank charges back, but by then, the Co-op and many other banks were refusing to deal with refunds until the outcome of the Court Case. They then sent me letters demanding that I 'return all my card and cheque book' and without warning, completely removed my overdraft facility, leaving my in a completely untenable situation. (my wages by then were just over £600 per month and had I not got worried and changed my bank details with my work payroll, my entire wage packet for one month would have been swallowed up by the overdraft that no longer existed - except as a debt on my account). Then they decided I had defaulted and sent me a letter stating I was no longer a customer - a letter I was charged £65 for!

 

I wrote detailed letters of complaint and had a current claim for unfair charges..... they even admitted liability saying in my circumstances I should have been offered a 'reducing' overdraft. However, the complaint came to a stalemate and with the trauma of my partner's illness, I had no stomach for going any further. They have since sent me a standard letter saying they are not going to refund the charges as the Court had decided that the Banks charges were "fair and lawful".

 

The account now stands at over £900 and I have been pursued (by letter only) by Moorcroft. About 2 months ago they offered me a full and final of £700. But I ignored this as as far as I was concerned, Co-op had already admitted liability and should have cancelled all charges. I have been out of work and have multiple Debt collectors pursuing me and am currently only able to find p/t work.

 

Does anyone have any advice on how to proceed? Do I offer a Full and Final to Moorcroft (around £200) or do I make a full complaint to the Ombudsman?

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I have had a serious problem with the Co-operative Bank since 2007, with excessive charges and persistent referrrals to a Debt collection agency (Moorcroft). When I opened my account, I had a good credit reference (which had taken many years to get up to scratch) and was given a Cheque Book account and debit card. Three weeks after opening the account, I was in need of extending my overdraft, which was initially set at £250, as it was coming up to Christmas. I telephoned Co-Op customer service and after a short conversation, was told I was 'entitled' to an O/D of £600.00. I was on a fixed-term full-time contract which was coming to an end in April 2007 and being replaced with a p/t contract.

 

Trying to be responsible and forward-planning, I telephoned the bank one month before my full-time work contract came to an end and the part-time one started, telling them my income was about to be more than halved and enquired if I could have an £800 overdraft limit, on a 'reducing' basis, until I could get back on my feet and pick up some additional work. I was met with point-blank refusal and told that I had to have my account for "at least 6 months" before they could 'consider' an extended overdraft and that 'a reducing overdraft was out of the question'. The fact that they had increased my initial overdraft to £600 after my account had only be open for 3 weeks was apparentlly 'irrelevant'!!

 

Within a month of my income dropping, I started to get into serious financial difficulties, exacerbated by the fact that my partner was taken seriously ill and hospitalised 70 miles away for nearly 4 months and was unable to work. I had no access to his sick pay as we did not have a joint account. Then the charges started - £35.00 and £37.50 plus interest, at a time, taking my account over £800 in the red in a very short space of time. Initially I was lucky in that they agreed to refund £400 as a 'goodwill gesture' however, they continued to charge me, refused to acknowledge my serious hardship and in a short space of time, my account was over £600 in the red again. I decided to try and get my bank charges back, but by then, the Co-op and many other banks were refusing to deal with refunds until the outcome of the Court Case. They then sent me letters demanding that I 'return all my card and cheque book' and without warning, completely removed my overdraft facility, leaving my in a completely untenable situation. (my wages by then were just over £600 per month and had I not got worried and changed my bank details with my work payroll, my entire wage packet for one month would have been swallowed up by the overdraft that no longer existed - except as a debt on my account). Then they decided I had defaulted and sent me a letter stating I was no longer a customer - a letter I was charged £65 for!

 

I wrote detailed letters of complaint and had a current claim for unfair charges..... they even admitted liability saying in my circumstances I should have been offered a 'reducing' overdraft. However, the complaint came to a stalemate and with the trauma of my partner's illness, I had no stomach for going any further. They have since sent me a standard letter saying they are not going to refund the charges as the Court had decided that the Banks charges were "fair and lawful".

 

The account now stands at over £900 and I have been pursued (by letter only) by Moorcroft. About 2 months ago they offered me a full and final of £700. But I ignored this as as far as I was concerned, Co-op had already admitted liability and should have cancelled all charges. I have been out of work and have multiple Debt collectors pursuing me and am currently only able to find p/t work.

 

Does anyone have any advice on how to proceed? Do I offer a Full and Final to Moorcroft (around £200) or do I make a full complaint to the Ombudsman?

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It takes around 6 months for Moorcroft to get involved, and by now there's little chance you'll be able to get the account sent back to the Co-op to have their recoveries department deal with it.

 

From the point of view of the bank, your £600 overdraft entitlement was given based on your initial credit score, coupled with the banks own scoring system. To ring them and say 'my income is dropping, please can I have some more debt' just rings alarm bells. I apologise if this seems blunt, but that's the bottom line of the request. In your mind it was a viable solution but really, the bills should be coming down before the temporary lending facilities go up. Who told you about a reducing facility?

 

A reducing overdraft is actually offered as a repayment overdraft, it should only be given in times of complete dire straits, when you're already over limit, or if you're coming up to the end of your overdraft term and can't pay it back in full. Over time, with the constant in and out of staff in the customer service area, the facility got bastardised into a free-for-all option. Consider this: the reducing overdraft is offered by the debt management department, not customer services. You shouldn't even have known it existed based on the circumstances as at that time your account was clean as a whistle.

 

However, from your side, you did everything you felt appropriate - and I must say you did it correctly. You told the bank of your impending difficulties but were unfortunately not assisted at the time. The issue was compounded by your partners illness, and i'm sure the last thing on your mind was dealing with your account. That's where the issue begins i'm afraid. Without speaking to the bank while the issue exists, it will run out of control with the system indiscriminately charging you until finally the facilities are revoked and the bank just wants the money back. In all fairness, they do limit quarterly charges. You won't be charged more than a certain amount in a 3 month period.

 

The reason charges continued is because after your initial charges were refunded, the pre-notified charges (over limit charges that are put on after the event occurs) then apply. It's up to the advisor whether they refund those or not, but it sounds to me like they didn't deal with the pre-notified charges. These are notified to you at the bottom of your paper statement, but again probably not the first thing you'd read.

 

Without seeing the wording of the letter, i'm afraid I can't see how the bank had admitted liability for the circumstance. Your initial overdraft refusal for £800 was rejected based on the lack of income, lack of history, internal and external credit scoring. That's not to say you're a bad customer, you just didn't fit the criteria for more money, especially when your income was about to drop.

 

Did you go elsewhere, ask for a credit card from another provider? Speak with the creditors elsewhere? Virgin Media? Gas, Electric? How much was your rent/mortgage? Again I apologise for sounding harsh but this isn't the fault of the bank in its entirety. Your income dropped and your partner was very unfortunately taken ill. All of this resulted in the issues you had. It MIGHT have helped if you'd had an overdraft increase, but for how long? If your income was less than your outgoings, the issue would have happened a month later anyway.

 

For now I wish you good luck with speaking to the co-op. Tell them about these circumstances, they might buy the debt back and reduce the charges, maybe even wipe it out if it's all charges. Write to the executive office, that'll get your complaint dealt with effectively.

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