Recurring Payments Warning! discussion

Andystriker

Hi All,

If you report your card stolen to your bank, would this not stop these payments?

Andy

sarah1773

Andystriker wrote: »

Hi All,

If you report your card stolen to your bank, would this not stop these payments?

Andy

I thought that would work but my bank said this wouldn't help as I have already given 'permission' for the recurring payments to be taken so it would just be transferred to my new debit card! Which is ridiculous really and really surprised me. However, other people on here have reported their card as stolen and no more payments have been attempted on their accounts, I suppose it depends if you want to risk it.
My bank told me I should first inform the company to cancel the recurring payment (in writing by recorded delivery so they can't deny they received it) - if they then take payment again, they are in breach of the banking code and I should then tell my bank who will then take further action on my behalf and should get a full refund. Very grey area - I did not realise it would be this complicated!

masonic

sarah1773 wrote: »

I thought that would work but my bank said this wouldn't help as I have already given 'permission' for the recurring payments to be taken so it would just be transferred to my new debit card! Which is ridiculous really and really surprised me. However, other people on here have reported their card as stolen and no more payments have been attempted on their accounts, I suppose it depends if you want to risk it.
My bank told me I should first inform the company to cancel the recurring payment (in writing by recorded delivery so they can't deny they received it) - if they then take payment again, they are in breach of the banking code and I should then tell my bank who will then take further action on my behalf and should get a full refund. Very grey area - I did not realise it would be this complicated!

Surely no bank would carry over transactions from a card account that may have been used fraudulently on to a new card?

Paul_Herring

masonic wrote: »

Surely no bank would carry over transactions from a card account that may have been used fraudulently on to a new card?

A valid authorisation was carried out before the 'fraud' - they are valid transactions on the account, regardless of what's on the front of the current card, or any subsequent fraud on the card that was current at the time of the valid authorisation.

The alternative is for customers to contact any and all institutions that may have old card details when you get a new card for whatever reason (fraud, expiry, damage,) in much the same way that you would do with your standing orders and direct debits if you change current accounts. Can you imagine the outcry of people getting late payment fees just because their last card happened to expire?

I'm guessing that the numbers affected by the latter scheme would vastly outweigh those being affected by the (current) former scheme.

sarah1773

Paul_Herring wrote: »

A valid authorisation was carried out before the 'fraud' - they are valid transactions on the account, regardless of what's on the front of the current card, or any subsequent fraud on the card that was current at the time of the valid authorisation.

Yes, this is what the bank told me - unfortunate but true!

masonic

Paul_Herring wrote: »

The alternative is for customers to contact any and all institutions that may have old card details when you get a new card for whatever reason (fraud, expiry, damage,) in much the same way that you would do with your standing orders and direct debits if you change current accounts. Can you imagine the outcry of people getting late payment fees just because their last card happened to expire?

I would have hoped banks systems could distinguish between fraud and routine card reissue/replacement. If I lost my card, I would not be satisfied if any subsequent transaction showed up on my account that I knew used my old card number. After all, all I would have is the banks' word that the old card was blocked and anything that cast any doubt on that, like a recurring transaction going through using my old details, would give me serious doubts about the security of the bank in question.

In the distant past, I did lose a credit card (for about 2 hours), and after reporting it lost I got issued with a whole new account number and had to go through the hassle of updating a couple of companies that had recurring payments set up, and also setting up a new direct debit to pay off the card. I wouldn't have had it any other way though - I was reassured by that experience. It's unfortunate if that isn't the normal procedure.

Paul_Herring

masonic wrote: »

I would have hoped banks systems could distinguish between fraud and routine card reissue/replacement.

The distinction is irrelevant for transactions authorised before the potential for fraud to take place. The card held at the time is used for the one time authorisation, and thereafter it's irrelevant as to what numbers are on the front of the currently valid card.

If I lost my card, I would not be satisfied if any subsequent transaction showed up on my account that I knew used my old card number.

Even if you'd authorised those transactions before it became an old card number?

After all, all I would have is the banks' word that the old card was blocked and anything that cast any doubt on that, like a recurring transaction going through using my old details, would give me serious doubts about the security of the bank in question.

Then you will have serious doubts regardless of which bank you're with. They all do the same thing.

In the distant past, I did lose a credit card (for about 2 hours), and after reporting it lost I got issued with a whole new account number and had to go through the hassle of updating a couple of companies that had recurring payments set up,

Then it was so long ago that the current method of taking recurring payments didn't apply, or recurring payments weren't being taken, and they were in fact submitting the card's details each time (essentially a series of one-off transactions, rather than a recurring transaction.)

With a recurring transaction they don't *need* your currently valid details, and in the simplest case your card number simply becomes a reference number to your account, rather than a method of authorisation (since you already gave authority for all future transactions when you gave your first payment.) Alternatively, the card company may just give a reference number that uniquely idenitifies that company taking payments from your account, and the card company simply puts those charges on your account regardless of whether the card in your wallet is the one you used for authorisation.

In either case, 'losing' the card used for that first payment will not automagically cancel any further transactions.

and also setting up a new direct debit to pay off the card. I wouldn't have had it any other way though

Again, if it was long enough ago, it's likely the card company didn't have any process in place to 'tie' the old card with the new card (these days they're more than able to do this, hence the lack of need to set up new DD's for re-issued cards for whatever circumstance.)

usedandabused

sarah1773 wrote: »

I have rang my bank who say cancelling the debit card will make no difference and the payments will be transferred to my new debit card!

So the next step is write to the company who set up this recurring payment and say I no longer give authorisation and to cancel the recurring payment. I will send it by Recorded Delivery and demand written confirmation that the recurring payment has been cancelled. Then if any further payments are attempted I need to send a copy of the cancellation letter to my bank who will take it up for me on my behalf.

I do wish I had looked at these threads before I allowed a recurring payment to be set up. Now I must ensure I keep enough in my bank account in case the payment goes out as I do not have an overdraft.

I will post again when there are any futher developments - thanks for everyones help

I got stung just before xmas, but Lloyds cancelled my card and guess what?

recurring payments stopped, and Lloyds recommended I get a new card sent, if I felt my card security was at risk, the adviser was so helpful!

sarah1773

usedandabused wrote: »

I got stung just before xmas, but Lloyds cancelled my card and guess what?

recurring payments stopped, and Lloyds recommended I get a new card sent, if I felt my card security was at risk, the adviser was so helpful!

Very fortunate for you, however I will go on the advice of my bank and actually cancel the recurring payment with the company rather than risk cancelling/reporting lost or stolen my card and the payment still going through. Perhaps it depends on the company you have the recurring payment with, I don't know. My brain aches

jace2000

Hello if somebody could help that would be great, I am in the process of canceling a recurring payment and need to send the company a letter only i am hopeless writing a good letter.
the general outlay and what to put in the letter.

Thanks in advance.

Jason.