Halifax ceased our small business account- Stressed! Please help

[res123]

Hi All- First of all, I want to thank all of you for being very supportive and have such a great forum.

 

We opened a Ltd company (very small business) account with Bank of Scotland. They asked questions over the phone and the director (a relative) told them the intention is to trade on Ebay. Account was all set, we deposited £2000 in cash and we received username and passwords in mail for online banking. Unfortunately, online banking password didn't work and were directed to call customer service and the troubles begin.

 

The security questions they asked were apparently not answered correctly. They ceased the account and blocked online access and are requesting receipts/invoices of business. The problem is that £2K was suppose to be used for buying merchandise hence no receipt and I didn't think they could request that for us to access the account. We subsequently requested they close the account and refund the money back under company's name so we can open account elsewhere, but they insist that they must get requested documents before releasing funds, closing or waiving the cease.

 

I filed a complaint with their customer relations and they responded within 7 days and have referred me to ombudsman's office. I am confused as to how I ended with this predicament and that its a lot of money for us. What happened here and what can I do next to recover these funds?

 

Your advice is greatly appreciated.

 

Thanks,

Res.

[Undercover-Elsa]

Hi,

What a nightmare for you. BOS have been unbelievably intrusive and uncooperative. Are they not familiar with the concept of small business startup capital? Obviously before you start trading the cash has to come from somewhere!

Where did the cash actually come from? Was it withdrawn as cash from a personal account? If so perhaps they would accept proof of the withdrawal?

I would complain again, this time to the CEO of BOS, explaining it was startup capital hence no receipts etc.

 

Alliance and Leicester do a small business account which is quickly set up online, no phone calls, no intrusive questions asked, just basic ID checks.

 

Elsa x

[res123]

Thanks for your response Elsa. BOS didn't ask us to prove where the money came from, they want receipts of the business. The company was incorporated some time back by a family relative who actually lent the £2K. I am confused by their demand, as I cannot understand the intent behind it? They want receipts/invoices and won't budge. I've now spoken to family relative who did purchased and sold a piece of land and may have invoice of that. I am reluctant to give them anything that they may turn around and use against me (I don't have anything to hide).

 

Its just that when I opened the account I informed them what I plan to do (sell goods on ebay). Instead, they will see an invoice of land purchase/sale and make my life harder as the relative is now getting a bit annoyed that I am being too intrusive in their business where all they wanted to do was to help me, and gave me their company (after taking care of their affairs) so I don't incur costs in setting up.

 

In short, they have given me their final response letter saying that either provide what's being asked or take the matter with Ombudsman's office. The Ombudsman's website states that it may take up to 6 months. That is an awful long time to get our own funds back.I wonder if emailing the C.E.O is a good idea or am I going to be sent back to the same department. C.E.O's can typically help expedite the process but not change the decision made by low level security department.

 

Any other suggestions?

 

Thanks,

res.

[Undercover-Elsa]

Hmm, tricky. So your relatives did their own final accounts, then gave you the business, since when you haven't started trading yet? Was there any paperwork involved in the transfer? Is it a Limited Company?

Would it satisfy the bank if your relatives provided a letter stating the circumstances, I wonder?

 

Bear with me....I'll alert the site team to see if anyone's around with more knowledge of business accounts.

 

Elsa x

[rebel11]

Thread moved. It's been flagged up.

[Undercover-Elsa]

Thanks Rebel

[stormski]

Hi res123,

 

If i were opening a business account...i certainly wouldn't go with the Multis ( ie: the ones who virtually own the uk banking sector even though they are really owned by the people ).

 

I'm sure you'll get a lot of help anyway...

 

( And Elsa Rules )

 

No disrespect to any of the others who help either.

 

Regards,

Stormski

[rebel11]

Hi res

 

Write a Formal Letter of Complaint, mark it as such, explain whats happened, explain that you want the monies returned forthwith. Explain that if it is not returned you will take legal action to recover the monies, give them a deadline to return the monies. Also point out that if you take the matter to the FOS it will

cost them £450. 'Explain that there are no invoices as no stock has been sourced', but maybe they will understand the sentence better at a cost of £450 via the FOS. Also explain that

you will never do any business with Bank of Scotland or associated companies.

 

Antonio Horta-Osorio, Chief Executive

[email protected]

[BRIGADIER2JCS]

£2K plus interest @ 8% with immediate repayment

+ compensation for loss of earnings say £1500.00

per month minimum, reasonable I think:madgrin:

[res123]

Thank you to all who responded. Here is a letter I wrote to Bank of Scotland:

 

"Dear Sir/madam,

I am writing in relation to ABC, Ltd. As a director, I opened an account few weeks ago. I was given online access but forgot the password and was locked out of my account. I called to reset the password a few times but the bank never sorted out the issues.

 

Before the password lockup, there was a deposit made in the amount of £2000. I’ve now learned that the bank ceased the trading account. I find this unjust and unacceptable. The bank is putting undue pressure on our small business.

 

After getting fed up with the service and being able to resolve the online banking issues, I went to a local branch with my identification and requested that bank close the account and refund any deposits. The bank denied my request and the account remains ceased besides my best efforts to resolve the matter.

 

I am requesting that bank closes the account and returns the funds as a matter of urgency or we will escalate the matter to Financial Ombudsman office. Furthermore, we reserve the right to bring any legal action against Bank of Scotland seeking compensation for putting undue pressure on the business by withholding these funds.

 

I am hoping to get this issue resolve expeditiously and I anxiously await your written response confirming the receipt of my complaint.

Best Regards,

 

 

This is before I posted on this forum hoping to get some sort of result. Instead, they've stuck to their ground and have asked us to either provide what's being asked or feel free to take the matter to Ombudsman's. So, the relative is able to provide the receipts of the copy of settlement statement of a past transaction before the company was handed over to us. I am reluctant to provide this particular item to appease them. A part of me thinks it will open more can of worms and raise their unreasonable demands. Should I accept this as there final response and proceed with Ombudsman's office or write one final time explaining there was no receipts as the money is being held hostage.

 

As always, I appreciate the advice.

[BRIGADIER2JCS]

Yes it now needs to go to

the Ombudsman, when making

the complaint make sure you include

what decision you feel that the adjudicator

should make, include the immediate refund + interest

and refund of any charges, plus compensation for

loss of earnings and damages for the stress

and embarrassment caused by the banks unreasonable

actions, don't let them get away with anything:madgrin:

[res123]

Hi Brigadier: I have never done this before. What sort of interest, and compensation is reasonable in this case? I have no clue where to start, really. When we opened the account we mentioned that turnover may be in the region £35-40K per annum (best guess, really). I be happy with getting back the funds, but it's been easily over two months now. Any suggestions on interest and compensation figures?

[BRIGADIER2JCS]

Hi Brigadier: I have never done this before. What sort of interest, and compensation is reasonable in this case? I have no clue where to start, really. When we opened the account we mentioned that turnover may be in the region £35-40K per annum (best guess, really). I be happy with getting back the funds, but it's been easily over two months now. Any suggestions on interest and compensation figures?

Hi res, as this would be a new business the TO in the first couple

of months would have probably been reasonably small so I would base

the potential income at around the national average so £1500 -£2000 per month,

the interest on the £2K at 8% per year pro rata and compensation/damages

for loss of business, stress etc. being ''reasonable'' £5k.

I would put this schedule to the banks CEO prior to the complaint

to the Ombudsman in a ''spirit'' of fairness to give them a chance

to settle without recourse to the Ombudsman or court action.

 

Brig.

[res123]

Thanks for your suggestions. I like the idea of writing to the CEO. I have tried looking for the email on google and haven't been able to. Does anyone have an email address or mailing address for the Executive/CEO office?

[BRIGADIER2JCS]

Don't use e-mail unless you can get the direct address.

Send by recorded delivery to the banks head office,

to the CEO marked PRIVATE & CONFIDENTIAL.