Lloyds have frozen my account

Last Wednesday I went o pay for my lunch and my card was declined. I knew I had funds in my account as I'd transferred some money from my ISA that morning.
I then walked over to the bank and the cash point took my card. I went into the bank and they did not have any idea why it had happened and asked me to leave it with them.......
So here I am 5 days later with no answers and no bank account!!
I've rung them every day and all I am being told is that there is a "processing delay" with my account.
I have asked each person I have spoken to what actually is a processing delay and they haven't got a clue.
It's being dealt with by and internal department but they won't tell me who the internal department is.
Had any one ever had this or could any one shed any light on what could be happening?

I am actually on maternity leave and have been using my savings to live off of if that could make any impact at all?
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  • Ed-1
    Ed-1 Posts: 3,867
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    Cem2016 wrote: »
    Last Wednesday I went o pay for my lunch and my card was declined. I knew I had funds in my account as I'd transferred some money from my ISA that morning.
    I then walked over to the bank and the cash point took my card. I went into the bank and they did not have any idea why it had happened and asked me to leave it with them.......
    So here I am 5 days later with no answers and no bank account!!
    I've rung them every day and all I am being told is that there is a "processing delay" with my account.
    I have asked each person I have spoken to what actually is a processing delay and they haven't got a clue.
    It's being dealt with by and internal department but they won't tell me who the internal department is.
    Had any one ever had this or could any one shed any light on what could be happening?

    I am actually on maternity leave and have been using my savings to live off of if that could make any impact at all?

    When was the account opened? Recently?

    Ask them to check indicators and they'll probably tell you that it's got a '646' indicator on the account blocking transactions. Ask them to check the customer notes as there should be details there about which department put the indicator on it. If the account was opened recently it can be declined by credit decisioning subsequently.
  • Cem2016
    Cem2016 Posts: 10 Forumite
    No I've had my account with them for around 30 years
  • ratechaser
    ratechaser Posts: 1,674
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    I hope that I'm wrong, but the vague/borderline obstructive responses from Lloyds could indicate that they are investigating your account for potential money laundering. In that case, they are actually not legally allowed to tell you that's what they are doing (that would be 'tipping off' - a criminal offence).

    There's quite a few threads on this board where banks appear to have taken this action pretty arbitrarily, and unfortunately there is not a lot you can do other than sit it out if that is the case.

    In theory at least, such an investigation would be triggered by unusual account activity causing suspicion at the bank. You mentioned being on maternity leave, and also having transferred funds in from an ISA. So does that mean that perhaps you have had recent changes to salary payments (e.g. decreased while on leave), and also was it a big transfer in from your ISA? That's the sort of thing that can make banks AML monitoring processes think that something is 'up' and needs investigating...

    And no, I don't think it's fair, but it is legal, and in fact required of the banks to act this way, although many of them seem to be overzealous here.

    Anyway, as I said, I hope that this isn't the case for you here, but you might want to look at similar threads to see how this plays out, just in case.

    Good luck.
  • Ed-1
    Ed-1 Posts: 3,867
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    Cem2016 wrote: »
    No I've had my account with them for around 30 years

    Then it's not an application related decision.

    There's two reasons why they place a blocking indicator on an account. The first is if they have decided to withdraw that facility/all facilities as a result of a credit decision in which case the indicator is there pending account closure to prevent funds being deposited. They also sometimes make mistakes in blocking an existing account when only a newly opened account that is subsequently declined should've been blocked.

    The second (which is likely in your case) is a block that has either been automatically put on the account for security (e.g. if the system has detected unusual usage of debit card/internet banking etc.) or if the block has been placed manually as a result of an investigation into account transactions (AML) etc.

    In either case there should be a note in the customer notes saying why the indicator has been put there.
  • Ed-1
    Ed-1 Posts: 3,867
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    edited 17 October 2016 at 12:34PM
    ratechaser wrote: »
    I hope that I'm wrong, but the vague/borderline obstructive responses from Lloyds could indicate that they are investigating your account for potential money laundering. In that case, they are actually not legally allowed to tell you that's what they are doing (that would be 'tipping off' - a criminal offence).

    That's how ridiculous the legislation is. I know someone who had their account blocked for 3 months with no access to funds which caused missed mortgage payments. They had to prove their source of wealth to regain access. They complained to the bank and subsequently the FOS and was fobbed off with 'the bank has acted within their statutory duties so I cannot uphold the complaint and although the bank have found the account to be in order, I understand that the timescale of your lack of access to funds was frustrating and I have asked your mortgage provider to remove any missed payment markers from your credit reference files a result of this being outside of your control'.

    No financial compensation. Talk about 'guilty until proven innocent'.

    And it's only going got get even worse as more legislation comes in giving banks free will to report suspicions and share customer concerns through a secret gateway:

    https://www.gov.uk/government/consultations/anti-money-laundering-and-counter-terrorist-finance-legislative-proposals

    The proposals also introduce a power for funds to be swiftly ceased if an account holder does not prove their source of wealth upon request from the bank.
  • TheShape
    TheShape Posts: 1,777
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    I wonder what sort of transactions would trigger a AML investigation?

    I expect many people engaged in the 5% savings loophole have account transactions that look like my Nationwide account which shows 10s of thousands moving through it each month. I've not long set-up multiple accounts so this transactional activity will drop off.

    I expect that an account with large amounts of 'cash' being credited and/or withdrawn would be the number one indicator of money laundering.
  • ratechaser
    ratechaser Posts: 1,674
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    Yep, along with 'credit clamping' (see the parking tickets board for more detail there...), this is one of the financial scandals of our age. Global banks happily launder money for drug cartels, arms runners and the like, then they get huge fines, and then they suddenly come over all draconian with internal policies meaning that everyday innocent customers regularly get caught up in Kafka-esque nightmares like we read on here.

    There's not one bank I know of that actually gets AML right at the moment, it's all far too reactive and crude. And I say that from the perspective of someone that's been very close to these processes in big banks all my working life. But right now it seems to keep the regulators happy, and avoiding fines is more important to the banks than inconveniencing customers.

    OP, apologies for the rant here, as I said, I hope that this isn't what's happened to you and this gets resolved quickly...
  • MARTYM8`
    MARTYM8` Posts: 1,212
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    My advice is - open another bank account with another bank outside the Lloyds group (Halifax, BOS, Lloyds - TSB possibly too) asap!
  • Cem2016
    Cem2016 Posts: 10 Forumite
    My salary has decreased significantly whilst on maternity leave as I only get SMP.
    I have been using my savings to live off of and it has depleted over this year although there is still £10k in my ISA.
    I inherited £17k after the death of my grandfather which was in my ISA as well as some other savings but only a couple of thousand.
    It's a complete nightmare - having a baby and no money is just awful.
    I'm litterally rationing nappies as I don't have the funds to pay for more.
    They even have my child benefit payment. It is only £80 but I asked if they could just release that so I can feed and nappy my child and they still said no.
    Living nightmare
  • ratechaser
    ratechaser Posts: 1,674
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    TheShape wrote: »
    I wonder what sort of transactions would trigger a AML investigation?

    I expect many people engaged in the 5% savings loophole have account transactions that look like my Nationwide account which shows 10s of thousands moving through it each month. I've not long set-up multiple accounts so this transactional activity will drop off.

    I expect that an account with large amounts of 'cash' being credited and/or withdrawn would be the number one indicator of money laundering.

    Agreed, I'm frankly astonished that I've not been caught out yet. I think it was about 80k in and out of my flex account last month for various reasons. I can only assume it's because they have a record of my previous (erm, substantial :o ) salary on file which may put it into perspective.
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