Is the bank taking your Benefits ?

[pixieboo]

just a quick question my bank has been making deductions on my account for being overdrawn (15 pound a month charge and then 15 pound everyday it is overdrawn) the only thing that goes into this account is benefit payments (child tax , dla , child benefitand dla)

and they always take it out on a sunday when i get my carers which means i end up with no carers and are overdrawn again (yet more charges:rolleyes:)

is this right ?? i am being left with no money half of the time due to thier charges:(

[Mistermind]

BBC NEWS | UK | Banks 'take payments by stealth'

 

Banks are leaving people unable to pay mortgages by taking money from their current accounts to cover credit card and loan debts, a charity has claimed.

 

Citizens Advice is calling on banks to scrap the practice, which allows them to transfer funds without permission. It says it has seen a 25% rise in the number of such cases in each of the past two years.

 

The British Bankers' Association says the onus is on customers to talk to their banks if they are in difficulty. In most cases, companies can only force someone to pay a debt by taking them to court.

 

However, as BBC Radio 4's Money Box discovered, the Right of Set Off allows banks to legally transfer cash to pay credit card or loan arrears without account holders' permission. Citizens Advice says there have been cases of people having benefit payments removed from accounts, leaving them unable to meet "priority debts" like mortgages and council tax. The British Bankers' Association says cases where money has been removed "inappropriately" are regrettable but that banks take their responsibilities under the banking code seriously.

[JonCris]

"banks take their responsibilities under the banking code seriously."

 

AND pigs can fly..........And the Moons made of green cheese

[FANTASY CHARGES]

BBC NEWS | UK | Banks 'take payments by stealth'

 

 

MONEYBOX ON RADIO 4 TODAY AT MID-DAY COVERED the fact that banks could do "set offs" taking cash from your bank account to pay a credit card (we all know or should that the halifax actually had this in some t & c)

they came down against it and moneybox asked for people who had had this done to them to contact the programme

 

 

BBC - Radio - Podcasts - Money Box

 

 

 

hopefully you can get the podcast from this link above

[The GodMother]

JC i thought the moon was made of green cheese now your telling me its not.

[InformedSearcher]

I work full time, no benefits at all but recently wrote to Natwest to ask for over £100 of charges back under 'extreme hardship'.

I wrote a break down of my incoming and outgoings and asked them to please waive them and they repaid all of it.

I didn't use any formal letter, just a human letter which I have always found works much better (have reclaimed numerous times in this way for those I work with).

Anyway, benefits or not, try writing a begging letter to the banks. Don't forget most of those that will read it do have hearts lol

Also, if they refuse you can appeal that decision - few people seem to realise this.

Sally x

 

Congratulations on getting something - I was laughed at myself with HSBC.

I have to reply in the case of HSBC (aka How much can we extract off 'em bank).

LOL I have over £5k of charges over a few years.

I called them as I was made redundant end last August but my wife works.

Person one was so friendly and took all the details etc.

Later in the day they said 'No' to my application - actually all they do is tap into a system the data and actually make no decisions themselves.

I appealed and failed.

They might have hearts BUT they also have jobs so do not overide any decision, as the latter would be in jepody.

Conclusion: Never believe what you hear - a system tells them a simple yes or no and if 'no' then you ain't getting anything no mater how hard you try.

Michael

[rory32]

if 'no' then you ain't getting anything no mater how hard you try.

The bank does not have the final say as to whether or not you are in hardship. As the bank have given you a response you can now ask the FOS to consider your claim under hardship.

[InformedSearcher]

The bank does not have the final say as to whether or not you are in hardship. As the bank have given you a response you can now ask the FOS to consider your claim under hardship.

 

Thanks for that ...

Actually with all respect there's another comment somewhere on here regarding that. Regarding hardship (stayed) claims I think you'll find that:

a. The bank's decision will end up as final.

b. The FOS will back whatever the bank says.

c. The bank is 'not' forced to pay out under hardship rules.

d. They follow a voluntary (joke) FSA (section 14) code.

 

If anyone can tell me (or show me that's it's happened) differently I'll certainly persue it. There's going to always be this thing by the bank giving you the funds (and they'll never retrieve them should they win the case) is why should they? HSBC in my case did not follow the 'voluntary' code of practice but tried to 'bluff it to me' that they did when I complained.

They have a small Financial guidance section (as expressed to me) and again I reiterate my cynical view that, 'Of course they have, one for saying 'no' and the others for tapping it in and pressing enter'.

Sadly unless a county court will hear the case we are all a bit 'stuffed' on this one. In a nutshell they could not care less - blunt but honest reply/comment. Yes, they should be ashamed but hey if they eventually lose the case (remembering they are dealing with their mates) I can imagine the 'no' bonus headlines following! LOL We must always remember that the average current account (always in minimal credit) make nothing for them.

Michael

[ratbag1970]

My daughter is on benefits ie CB, JSA, CTC for the last three years. She and her partner have two small kids and benefits are paid into his NatWest account. NatWest continually take charges from this account often leaving them without ANY money. They have rang and NatWest staff have told them they are leagally entitled to take the money. They took £210 out in one go and are continuing to charge £35 every other day. Can someone please help. I'm disabled and on benefits myself and struggle to support them as well as my own family.

[ratbag1970]

Forgive my ignorance. The gent who contacted me- not sure how to send you the info you've requested without displaying via a post! Help

[rory32]

My daughter is on benefits ie CB, JSA, CTC for the last three years. She and her partner have two small kids and benefits are paid into his NatWest account. NatWest continually take charges from this account often leaving them without ANY money. They have rang and NatWest staff have told them they are leagally entitled to take the money. They took £210 out in one go and are continuing to charge £35 every other day. Can someone please help. I'm disabled and on benefits myself and struggle to support them as well as my own family.

I think the first thing yout daughter needs to do is open another account with someone else. She can either open a basic bank account quite quickly (it takes about a week generally) or she can open a post office account to get her benefits paid into. If she can't open these before her next benefit payment then she needs to explain the situation to the DWP and they can arrange for payment to be made by giro as a one off.

 

Once she has done that she then needs to start the process of reclaiming the charges.

 

Does she currently have enough money until her next benefit payment for things like electricity and gas?

 

Forgive my ignorance. The gent who contacted me- not sure how to send you the info you've requested without displaying via a post! Help

Who has contacted you for information ratbag1970 and what information have they requested?

[pixieboo]

OMG i am fuming with my bank!!!

Right here goes, on the 30th jan , a cheque bounced , leaving me overdrawn , then the money went back in , thus the cheque bouncing.

on the 3rd feb i was hit for bank charges of 61.00 (from being overdrawn earlier jan) but as they decided to take it out at 11:52pm (i saw it being taken out) , it left me over drawn until 12:00 am until my child benefit went in ,thus covering the overdraft with my child benefit and leaving me with zilch:(

 

i get up this morning to -£40.00 returned cheque fee and a £61.00 overdraft fee -for being overdrawn by 61.00 for 8 glorious minutes!!

so theres gone my child benefit this week and guess what i'm overdrawn again because of the £101 they have just robbed of me , guess what i'm looking at next month , more lovely bank charges:rolleyes:.

i'm getting really fed up with it now , for some people the benefits -like me-unfortunately is all they have and at the moment they are lining the banks pockets

any advice for me should i get onto the bank cos they have taken the p ?

 

thanks in advance

[pixieboo]

hi , i have already posted this twice so if you can see it and i cant sorry!!

here goes

on the 30th jan i had a cheque bounce , making me overdrawn for a few minutes until the cheque bounced and the money put back in

then on the 3rd feb i was hit by overdraft charges of 60.00 for being overdrawn earlier jan , well i say the 3rd it was exactly the 2nd feb at 11:52pm which left me overdrawn until 12:00am when my child benefit went in and covered the overdraft.

i wake up to this , this morning

£40.00 returned cheque fee

£60.00 overdraft charges - for being overdrawn by prob 10 glorious minutes:rolleyes:

so again my child benefit is gone , so i am skint until thursday and i am overdrawn again which is going to knock money off my child tax credit.and guess what again i will be looking to next month -more lovely bank charges

any advice for me as it all seems a bit harsh and i am fuming at the moment for some people like me the benefits is all we have and its lining the banks pockets!!??

 

thanks in advance

[rory32]

Obviously complain that they have hit you with charges for being overdrawn for 8 minutes. Also give the bank the letter below (amend as required).

 

Dear Sir/Madam,

 

Bank Charges and Benefits and the First Right of Appropriation

 

ACCOUNT NUMBER: xxxxxxxxx

 

I am writing to you following several charges debited from my account totalling £xxxx on (date).

 

Bank charges are unlawful penalties for breach of contract. However, the bank or building society is only allowed to charge you what it costs to cover their administrative charges. If they charge you more than this, you may have a legal right to get back the difference.

Notably, and in my instance, if the income in an account comes from benefits, they are also contrary to the legislation relating to benefits. If the income is from incapacity benefit, job seekers allowance, etc , they are contrary to section 187 of the Social Security Administration Act 1992. The working of this Act comes under the Treasury and the Department of Work and Pensions, respectively and are quoted below for your immediate attention.

 

Social Security Administration Act 1992

Miscellaneous

Certain benefit to be inalienable **

 

187- Subject to the provisions of this Act, every assignment of, or charge on-

(a)benefit as defined in section 122 of the Contributions and Benefits Act;

(b)any income-related benefit; or

©child benefit,

and every agreement to assign or charge such benefit shall be void; and, on the bankruptcy of the beneficiary, such benefit shall not pass to any trustee or other person acting on behalf of his creditors

 

When you open an account with a bank or building society and use their services, you are entering into a contract. The law says that the bank or building society must carry out its business:-

• with reasonable care and skill.

 

If the service is unsatisfactory you may be entitled to compensation if the contract has been broken. I believe that there has been a breach of contract as I feel your organisation has failed to handle my affairs with reasonable care and skill.

 

This failure on your behalf has caused me a great deal of hardship. I am left with no means to pay the rent/bills due to the unauthorised amount now outstanding. The incoming amounts due to be deposited into my account next week will only clear the amount outstanding leaving little if any to pay the rent, for housekeeping or utility bills such as gas.

 

I ask for a little compassion and request that the benefit amounts totalling £xxxx, debited in order to pay for your default charges, be refunded by return.

 

I am also writing to inform you that I am due to have the following payments made into my account:-

 

• Tax Credit payment of £xxx on xx/xx/xx
  
• Child Benefit payment of £xxx on x/xx/xx
  
• Incapacity Benefit payment of £xxx on x/xx/xx
  

Totalling £xxxx,

 

I wish to use my first right of appropriation for this money, for the following purposes;

Rent £xx

Utilities bills £xx

Housekeeping money £xx

I will withdraw the money on the day that it is deposited for the above use, and I would be grateful if you would ensure that any other payments out of my account do not interfere with this withdrawal.

 

Yours faithfully,

While the bank couldn't care less is you starve, they can not take money that you need for utilities such as gas, electricity and water.

[InformedSearcher]

'rory32' - That is a brilliant piece of letter writing! Sincere compliments to you for this. For myself personally, I'll keep it handy when going in for the 'kill'.

Thank you again

[rory32]

I would point out that a bank charge is not an assignment nor a charge made on benefit within the meaning of the Act but the letter should at least get you enough of your benefits back for you to live on.

[AA99]

Am making a claim against Nationwide before the end of the week and have taken the liberty to copy and paste to here, as we are living on benefits so shall be getting your letter off. However, would like to know if anyone else has gone this route:

 

Re: AA99 v NW

I will post this also on the Hardship Claims and FSA Waivers with bank charges, but in the meantime, shall bump my own thread, and let you know.....

 

I have just been on Mr MSE's site and someone on there has just had £2,000 worth of mortgage and council tax arrears paid off directly by the bank as part-settlement of his hardship charges claim. He is happy with that. The balance of the claim will progress with the FSA/Lords decision on charges.

 

I am about to submit my claim regardless as we are now in severe hardship and the Nationwide account I've had for 25 years is my single biggest source of funds for payment of utility bills (£800 shortfall) over 6 months:cry:

 

Wondered if anybody else thinks could be a good way to go, or not

[Blown up]

Great letter Rory , my daughter is having similar problems with Nat West taking her benefit to pay charges it must stop.

[InformedSearcher]

Dare I ask the question .... What's to stop the Financial Institution simply closing your account?

Michael

[emmaf01]

If you are in that much hardship with utility bills, I would explore the Energy Trust grants situation.

 

Nationwide closed my account after a successful charges claim against them- you need a parachute account asap.

[x-Miss-Cheif-x]

Hiya my benifits are due to be paid in my bank in a couple fo days, But i recently had a phone call saying that i had been living on my overdraft for too long and that I would have o pay it all back. So when i get my benifits all my money will be gone. Are you sayin that i can prevent this?

I will not be able to write to them as it wont get there in time so could i have some advise as to what to say to them in the bank.

Thanks for the help.

[lucy.c40]

hi all was reading through some of the threads with interest but couldnt find the answer i was looking for !.i sent a letter to halifax last week stating that 2 charges for £70 was due to come out of my account on 21st april and that the money i had going into my account was benefit money etc and needed it for gas/elec/shopping etc and the did leave it alone till after i withdraw my money ,now i find they have taken the charges out that has left me overdrawn and when i get my money next week it will all be gone in charges again ,whats the point sending them the letter as it helps for just one week .

sorry to go on just mad x

[InformedSearcher]

I had a recent discussion with my bank regarding a loan that has fallen behind due to financial circumstances. I've had many terse conversations about all this and finally a very nice lady (because she was wanting and getting information) went through everything.

The norm for a financial institution where they hold the account you income goes through is to prioritise. There is an added item such as housing/council tax benefit in the way they would not class that as income but subtract it off say rent and the actually tax charges.

So the easy bit is the income which consists of and pay (including from partners) and any all benefits (excluding housing/council tax) plus pensions and anything else, for example investments.

Now the outgoings and firstly the important ones such as rent and council tax (after deducting any council tax and/or housing ones), utilities including water rates, electricity and gas. This group are 'essentials' and should be paid before anything else. This is also how banks smile when questioned as they'll claim they will not interfere with these. It's also quite amusing to think they don't tend to discuss income and expenditure on current accounts.

Next priority is everything else excepting loans and credit cards. This section includes phones, food, clothing and even cigarettes. Remember though that this section is 'flexible' because the chances are the outgoings from the priority section and this one will probably leave nothing left to pay the loans and credit cards.

The last section as in credit cards and loans claimed to be fair because payments (if there's anything left to pay them) should be applied pro-rata. In other words if there's only enough to make 10% payments of 'all' loans and credit cards combined then this must be caluculated so monthly payments are 10% of each individual account.

The bank will also probably cancel your debit card (if you have one) and issue a cash card so you can only draw out cash at ATM's and nothing else. They have effectively put the emphasis on you to 'not' go overdrawn. All direct debit and standing order mandates will be cancelled and to any creditor the wording will look like 'you' and not your bank did that. If you do on-line banking that will not be affected but again the emphasis is on you to ensure that anything not immediately charged will take you below 'zero' as they'll charge you (however in theory this should not happen). Always remember to take into consideration that bank charges from a previous month will not forcethe account into arrears because, voilla, a charge will be incurred.

When a bank cancels all the DD and SO's it will exclude its own from that decision. They must agree that they will not call on the account if you do an income and expediture evaluation. However, the downside is that they are not letting you off! It's normally automatic that after 6 months (and soldom delayed) that default notices and the opening of the floodgates for Debt Collection Agencies. This particular item always made me smile when it was announced on TV within the last 3 months, a '6 months delay' for reposessions because AFAICR it's always been that!

Financial institutions have not really changed anything. They use PR to try and make themselves sound 'friendly' when many of us here know it's the exact opposite. No matter how it's put over, if you don't pay 'em the default notices will happen, CCJ applications will happen and DCA will thrive!

Michael

(p.s. still unemployed and ageing!)

[MARTIN3030]

Good points Michael.

The changes in the Banking codes in March 2008 which were forced on them by the FSA,has in part given the consumer more scope to demand considerations,especially where there are financial difficulties.

Later this year when the Banking Codes are replaced and transferred to FSA regulatory control,we should see even more clarity emerge.

Some of the points you explain are valid concerns,but its fair to say that in the last 18 months,a lot has been done to alleviate many of the problems consumers faced from the Banks and debt collection agencies.

The FSA and OFT have both been instrumental in lessening their powers and introducing working guidelines.

Granted,there is still some way to go-but its a good start.

[InformedSearcher]

Martin3030 - thank you!

I should have also mentioned that unless you are thinking of IVA's or at worst bankruptcy you will be paying everyone back in full with and applicable interest. You should also remember that many creditors upon having their Direct Mandates cancelled will also charge you a fee! Thi can sometimes be quite a shock as quite a few will charge that fee monthly.

Most landline and mobile services are more expensive if no DD mandate is in place. Effectively by being 'stripped' of everything you find you end up paying even more in penalty and (so called)service fees! A 'tip' here is to 'never' commit to a creditor that you will make a specific payment as they will always attempt to get you to do it.

Ensure you also keep your eye on CRA files too if possible - Example: A few years ago I had a Capital One account. I had a problem paying and the lady told me not to worry and they would not charge me interest for the next 3 months. A couple of months later I viewed my file and was stunned that an extra line was under Capital One giving the start date (of our conversation) and saying 'On Financial Difficulty Management Programme' (or something like that). To anyone, that does not need much interpretation at all when doing searches!

 

Michael

Michael