Bank siezes money on news of death to pay off loan

[muppetspotter]

Folks,

 

your assistance is required. My uncle recently passed away. Yesterday, my aunt went to the clydesdale Bank in Glasgow where they have a joint account. She told them that he died last week. The teller demanded all his credit cards and debit cards and the bank then took £3000 out of their joint account to pay off an unsecured loan in my uncle's name.

 

Now from my understanding this sounds rather dodgey. Surely on death (and there is a will) the executor (my aunt) is required to apply probate and therefore any claim the bank have on the estate is dealt with in strict order:

 

Funeral expenses

 

Secured Debts

 

Unsecured Debts

 

HMReveneue

 

DWP

 

My question is: were the bank allowed to take the money from the joint account and pay off thedebt on hearing (verbally) that my uncle had died?

 

surely the joint account should have been frozen, the will executed, the estate drawn up and after the above paid, the loan been settled?

 

if they are out of order then what can she do about it?

 

thanks

[Mr lex]

Hi Muppet,

 

I am very sorry to hear of this.

 

I hope to get someone to you soon.

 

Lex

[dx100uk]

they cannot do that

 

get your solicitor to write a strongly worded letter that the funds should immediately be replaced and distress compensation given.

 

legally what they have done there is VERY out of order and they could be seriously fined for it.

 

dx

[banker_rhymes_with]

Hello Muppetspotter!

 

Firstly, sorry to hear about your Uncle, and the distress this issue has caused for your Aunt.

 

I don't know the answers, yet, but I'm looking into the same issues, so will do all that I can to help.

 

Slightly off topic, but the following may suggest that a word to your Aunt's MP might well receive a sympathetic response:

 

BBC News - 'Unfair' bank charges to be banned, government proposes

 

I agree with dx100uk, in that I think the bank has overstepped the mark here.

 

However, many cannot afford a Solicitor, so if you or your Aunt have no direct legal support in the form of a Solicitor, then you'll need to work around that, and seek support via self-help and from any other directions that are available, or that can be suggested here. Such as your Aunt's MP, as mentioned, or the Financial Ombudsman Service (FOS).

 

Few here are fans of FOS, myself included, but they are sometimes useful when matters are simple. Such as when a bank has acted badly, as would seem to be the case here. It's Free, so I'd submit a complaint to FOS anyway, and it may speed up the reversal of the £3,000 fund grab from the Joint Account.

 

I know that most responsible organisations would normally need to see an original copy of the Death Certificate before any steps are taken, so it does seem highly irregular for them to demand that your Uncle's Debit and Credit Cards be surrendered without that evidence. If nothing else, it comes across as very high-handed, unsympathetic, and entirely self-serving of them to act in this way. Nothing new there, but it's especially poor for them to act in this way when your Aunt is coping with the loss of her Husband.

 

I'll try and come back with more concrete advice, ASAP.

 

Cheers,

BRW

Edited May 21, 2010 by banker_rhymes_with
Typo

[cerberusalert]

I suggest you send a SAR to Clydesdale too. This will show exactly what these debts were, whether there was any PPI which should have covered the a/cs and any unfair charges which can be reclaimed. http://www.consumerforums.com/resources/templates-library/86-debt-collectors/576-subject-access-request-debt-a-dca