Dispute with Building Soc over Interest. Advice sought.

efunc

I’m after some general advice on how to proceed with a dispute I have about the interest I’ve received on my saving’s account. I year ago I went into my Building Society to open a Regular Saver account and a second account that could be linked to it. The other linked account is the one I have a problem with. The girl in the branch opened the Regular Saver for me and then when I chose a fixed interest account paying 6.25% for my linked account she refused claiming that the account didn’t qualify as a linked account and that I needed to open their Online savings account instead (which paid variable interest at a much lower rate). I told her she was wrong about this but she insisted it was the only one that would qualify and suggested I open it with the minimum £50 deposit just to keep it open. I did so in order to get the wheels in motion since the offer on the Regular Saver account was due to expire in a day or two.

Anyway, knowing she was wrong about her advice I went back to the branch the following day armed with information from this forum which confirmed the T&Cs of the accounts. I saw a different woman this time and she agreed immediately that the previous person had got it completely wrong and apologised. She cancelled the online account and set up the fixed interest account for me for £5000 I intended to deposit. She transferred the £50 that had already been paid into the online account and then instructed me to transfer the remaining £4,950 in the next 14 days to qualify for the 6.25% rate. I did so the following day and the funds were credited a few days later. The conditions of the account were that there needed to be a minimum balance of £2,500 in there for 12 months to qualify for the fixed 6.25% interest, otherwise it would change to a variable rate.

Throughout the 12 month period the account has been open I have always been concerned that I was not on a fixed interest rate because whenever I logged on to my account the interest rate was shown, and it dropped to 2% and eventually 0.5%. I called customer services several times and each time they assured me I was on the fixed rate and to ignore the rate shown in my account details online! (They claimed that the true rate is only calculated when the account matures and they factor in whether or not any withdrawals have been made). I ended up paying £25,000 into that account over the year based on this explicit assurance. Each time I paid in significant funds I asked for confirmation that I was on the fixed rate, and I was given the green light time and time again.

Predictably, the account has now matured and I have received a fraction of the interest I should have, much of it at a paltry 0.5%! After complaining to customer services I received a letter of explanation saying that since the opening deposit was £50 followed by the remaining £4,950 five days later the account had fallen below the £2,500 threshold and immediately placed on a variable rate. This is counter to the assurance the branch employee had given me when she set the account up and counter to the information I have been supplied by customer services in about 7 phone calls throughout the year. Clearly I would not have been paying in an additional £20k into this account if I had not been emphatically told I was on the 6.25% rate and to ignore the rate showing on my online account details!

At this stage the Building Society are not honouring the rate and are suggesting that I need to prove I that was told I would be on the 6.25% rate. Aside from the fact that I am only in this predicament because of the incompetence of the first employee who set the £50 account up, how is it my responsibility to prove their own misinformation? They record all their phone calls and I’ve asked them to go and investigate themselves. However given that I may need to pursue this via courts or ombudsmen is it possible for me to get these recordings out of them as evidence? What if they erase them or say they can’t find them? I find this entire verdict a massive U-turn considering they were happy to tell me I was receiving 6.25% interest and accept thousands or pounds of my money for 12 months on that basis. It also seems to violate the standard banking regulations governing these accounts which say that they need to observe simple communication and consistent information and avoid any confusion or misunderstanding. I had done everything possible to seek clarity and assurances on the other hand. How should I proceed if they refuse to honour the interest. Any thoughts?

hra_2

May sound obvious but have you been back to your branch, preferably with the letter of explanation you received? Even if the employee who opened your account is not there any more, you might get a sympathetic hearing from the manager face-to-face especially as there *should* be some kind of record to show who set up your account at the very least and the cancellation and re-setting-up should be on record.

This bit sounded odd:
"since the opening deposit was £50 followed by the remaining £4,950 five days later ..." Even if there had been no problems setting up the account, it sounds as if your funds would have taken a few days to clear anyway. Are they saying you would only qualify for the higher interest if you had done a same-day transfer of the full £5,000 on the day the account was set up? What exactly counts as the first day of the 12-month term according to the terms and conditions - maybe you have a case for arguing the term started on the date the cleared funds were received?

efunc

thanks for your advice. Yes, I went to the branch armed with the receipts and names of the two people responsible for opening the accounts. the said they no longer work there so it would be difficult to get anywhere, but they would refer it to the area manager. that was days ago, and still no response.

the point about the opening deposit is, I think, that although my account opening receipt shows that i was opening the account with £5000, the first funds in was their £50 transfer! The remainder of it was credited 5 days later, but they are saying that at £50 it immediately fell below the threshold for the Fixed interest rate. If that was the case why did she say she was opening the fixed interest rate account for me? anyway, they're playing this by the book and saying I violated the account terms and hence don't qualify. it should amount to several hundred pounds of interest though.

opinions4u

Sounds like a Halifax Guaranteed Saver Reward.

The minimum opening balance was £2,500 which was clearly advertised at the time.

You need to keep pursuing it on the basis that it was the staff member who made you credit the £50.

Type in "complaints" in the search section of their web site and be prepared to move it to the Ombudsman if needed.

I think you will eventually get things resolved in your favour.

hra_2

Then my suggestions would be any or all of the following (can be done concurrently):

• Ask branch for area manager's name & address and send them a special delivery letter briefly outlining your case and summarising your latest conversation with the branch and chasing a response. The fact that the employees have left should be immaterial.
• Proceed through the normal complaints procedure anyway, with a view to going to the Financial Ombudsman Service at the end if deadlock is reached. Maybe it is worth getting touch with the FOS now anyway even though they can't investigate until you have gone through the whole procedure.
• Something I have not tried and maybe others can comment further: a Subject Access Request under the Data Protection Act. Your point about their refusal to acknowledge what was said in earlier phone calls is so true and such a common tactic (as is their turning the blame onto you for "violating" the terms). I am not sure whether this will yield the actual recordings (though where do they store these?) but in theory there should be some kind of notes about your calls to them if they have any kind of a professional system in place.

The point about the date of the start of the term is still worth pursuing imho: are they in fact saying if you had not paid the £50 then the start of the term would be the date the balance was cleared and you would be OK? If so this seems like a silly technicality - in effect you paid the funds as stated on your receipt in 2 chunks - why not after all - and 1 chunk cleared earlier than than the other.

Careful_ly

What a mess, caused by poor staff product knowledge.
I agree that the £50 should not have been transferred into this account by the staff member, the minimum balance for this account was £2500.

Also check the interest you have been given for the regular saver as you might have only been given 10% instead of the 12% you should have earned.

Good luck, I think you are in the right and should persue this.

efunc

opinions4u wrote: »

Sounds like a Halifax Guaranteed Saver Reward.

The minimum opening balance was £2,500 which was clearly advertised at the time.

You need to keep pursuing it on the basis that it was the staff member who made you credit the £50.

Type in "complaints" in the search section of their web site and be prepared to move it to the Ombudsman if needed.

I think you will eventually get things resolved in your favour.

Thanks. I was pretty knowledgable of the T&Cs of the accounts, more so than the staff at the branch it seems. Had I simply opened the Guaranteed Saver with £5k in new money I would have been OK. But they themselves transferred accross the £50 from the account they had mistakenly opened for me the day before! That has now given them an opportunity to avoid paying me at 6.25% interest because they are claiming £50 was the opening deposit, not £5,000. Even this could be acceptable had it not been the fact that I had been explicitly told that I would not be violating the terms of the account and would still qualify for 6.25% in order to get me to part with my money. It seems that they were prepared to honor the 'Reward' status of my account from inception and throughout the 12 months, right up until the last moment when someone somewhere seems to have decided on a U-turn because they spotted the loophole! I am already in their complaints procedure however I feel that it's just my word against their's and there's no recourse because they can decide however they like and choose to ignore phone calls and conversations which, I on my own, have no ability to produce as evidence.

efunc

Careful_ly wrote: »

What a mess, caused by poor staff product knowledge.
I agree that the £50 should not have been transferred into this account by the staff member, the minimum balance for this account was £2500.

Also check the interest you have been given for the regular saver as you might have only been given 10% instead of the 12% you should have earned.

Good luck, I think you are in the right and should persue this.

Thanks for the encouragement, that's much appreciated.

In actual fact I did receive the full 12% interest on my Regular Saver, which I was very happy about. However it begs the question, how on earth are they able to determine that my Guaranteed Saver was sufficiently in credit for the purpose of getting the extra 12% on my RS, but not in credit when it comes to awarding me 6.25% on the actual Guaranteed Saver? They seem to be playing fast and loose with their decisions.

rb10

efunc wrote: »

Thanks for the encouragement, that's much appreciated.

In actual fact I did receive the full 12% interest on my Regular Saver, which I was very happy about. However it begs the question, how on earth are they able to determine that my Guaranteed Saver was sufficiently in credit for the purpose of getting the extra 12% on my RS, but not in credit when it comes to awarding me 6.25% on the actual Guaranteed Saver? They seem to be playing fast and loose with their decisions.

Simply through the T&Cs, if you look at them, the Regular Saver ones said that £5k had to be in the nominated account within 14 days of the initial credit to get 12%, the Guaranteed Saver Reward ones require £2500 in the account at all times to qualify for the 6.25%.

Although you did break the T&Cs - and be prepared to admit this to Halifax - as it was on the basis of information given to you by them, certainly do follow it up with a formal complaint, in writing.

(P.S. Halifax is a bank, not a building society. You're over 10 years behind the times!)

soulsaver

And didn't the linked account to the Guaranteed Saver Reward have to be a current account? So not a Regular Savings Account.
And my GSR issue (6.0% Nov 08) had to have 'a qualifying' current account funded with £1000 pm throughout the year. Plus £2,500 minimum & no more than 4 withdrawals from the GSR in the period?
Mind you OP hasn't confirmed that the 'Building Society' is indeed a bank? Or the Halifax?

noh

soulsaver wrote: »

And didn't the linked account to the Guaranteed Saver Reward have to be a current account? So not a Regular Savings Account.
And my GSR issue (6.0% Nov 08) had to have 'a qualifying' current account funded with £1000 pm throughout the year. Plus £2,500 minimum & no more than 4 withdrawals from the GSR in the period?
Mind you OP hasn't confirmed that the 'Building Society' is indeed a bank? Or the Halifax?

Different offer with different conditions