Has A&L Committed Fraud?

irishbri

I was informed by 2 letters from Alliance & Leicester that I had gone over my overdraft limit and been charged twice for it. When I checked my account online I saw that I hadnt at any point gone over the limit and sent a letter to them asking them why I had been charged. This was on the 7th May.

I checked my bank account today and found had changed the order of my transactions and that I was overdrawn. To add insult to injury whoever had changed my statement put it that I was charged an overdraft fee before the direct debit had gone out!

Are the allowed to do this?

MarkyMarkD

My heart sinks when I see a thread title like this.

Pretty obviously, the answer to the title is "No".

Equally obviously, the answer to the rest of the thread is that A&L have probably not done anything wrong at all. Even if they had, it would be a mistake, not fraud.

The order of transactions on a day is irrelevant. A&L's terms and conditions require you to have funds in your account by close of play the working day before a payment is due ... so if you have a DD going out on Monday, you need to have cleared funds in the account by Friday close of business.

Transferring money in on the day the payment goes out is too late. So the order of the transactions on the day is irrelevant.

So, do you want to explain what actually happened again?

Checking your RUNNING balance online proves nothing; what matters is your CLEARED balance and even then, the "previous working day" rule prevails.

irishbri

OK fraud was a pretty strong word. I had place a standing order to transfer money from my HSBC account into my account for that day.

Checking my statement it states that my HSBC transaction hit my account before the direct debits went out.

But thank you for your obviously condescending reply.

If they were not in the wrong why have they gone into my account and changed my statement?

cte1111

I had exactly the same problem with A&L. At no point was my account showing as overdrawn during the day in question, but when they did the statement, they reversed the order of the items, so that the payments went out before the receipts went in. I think it is outrageous, but I don't think it is fraud. It is one of the reasons that we are moving back to First Direct.

willo65

As MarkymarkD has explained in the terms and conditions it will state that cleared funds must be in the account the day before d/d's go out and as the money wasn't in their the charges are correct.

The rearranging of your transactions will be automatic but d/d and s/o debit account early hours of the morning so when it showed in the order you wanted this would have been incorrect anyway.

MarkyMarkD

I don't know why people think that this is unique to A&L - it's not.

Most banks process automated debits overnight. It makes sense - you don't want customers goin to ATMs in the middle of the day, and spending money which needs to be there for that day's DDs.

And that is why the money has to be there by close of play the previous working day - otherwise it's too late.

The obvious exception is salary credits (and indeed other automated credits) which A&L do process overnight BEFORE the debits. It's totally fair.

If you look on A&L online banking, you can see the DDs on the account on the working day before they actually debit the account, by listing your DDs and then sorting in date order. This gives you notice that you need to get the money in there ... but you can only actually move it in there from another A&L account, or by depositing cash over the counter, at this stage.

It's worth knowing that telephone transfers between A&L accounts are instant as well - if you insist that they do it the right way! Online transfers are not "as" instant.

natweststaffmember

MarkyMarkD wrote: »

I don't know why people think that this is unique to A&L - it's not.

Most banks process automated debits overnight. It makes sense - you don't want customers goin to ATMs in the middle of the day, and spending money which needs to be there for that day's DDs.

And that is why the money has to be there by close of play the previous working day - otherwise it's too late.

The obvious exception is salary credits (and indeed other automated credits) which A&L do process overnight BEFORE the debits. It's totally fair.
I would argue the process is fair but the consequence of not having funds are a charge that could be argued as being unfair. Of course, I would argue that

If you look on A&L online banking, you can see the DDs on the account on the working day before they actually debit the account, by listing your DDs and then sorting in date order. This gives you notice that you need to get the money in there ... but you can only actually move it in there from another A&L account, or by depositing cash over the counter, at this stage.

It's worth knowing that telephone transfers between A&L accounts are instant as well - if you insist that they do it the right way! Online transfers are not "as" instant.

I think we all agree that the level of financial education in the UK would appear to be pretty poor.

MarkyMarkD

I agree with your comment, but I don't think that financial education is the point here. It's the fact that people don't bother reading the terms of their banking contracts, and then complain that those banking contracts don't say what they expect.

I have to say that, on the other hand, I find it quite strange that people think that if a DD payment is due to go out of your account on 1 May, it's fine to run into the branch at 5pm on 1 May with some used tenners believing that this is soon enough. Why is that reasonable?

On the day the DD is due to be paid, the bank has to make a decision whether to pay it or not. It cannot do that, if it has to wait until close of business to do so because by then it's too late to tell the other bank involved before the NEXT business day. And that might mean that the other party to the transaction despatches goods, or provides services, which they are never going to get paid for. The day's delay is unfair on the other party. Far more than it's apparently unfair on the account holder to be required to have funds in there at the start, rather than the end, of the banking day.

natweststaffmember

Some banks, re RBS Group can make a decision on the day up to 2:30pm however, it doesn't take into account necessarily online transactions or cash paid in unless the customer actually asks for an item to be paid on that basis. I do agree though with the rush through the door at 5pm on the same day, that is clearly a definite no.