Has your bank (esp Lloyds) ignored your hardship claim?

mitzymay

Hi,
Just been looking at my weekly email from this site and I felt I had to comment on the hardshipc ase I put in to Natwest over my bank charges. I am currently in an IVA due to my ex-partner using my details etc for credit. I followed the hardship claim on this site and was basically told I had enough money to live on (£200 per month) and if not then I should consider going bankcrupt! Great advice from the bank that is killing us with adverts on how helpful and rewarding they are, NOT!

So for now my case of just under £2000 is on hold, not that this amount may look a lot to others or the idiots at Natwest but to me it would help greatly for my new heating boiler I need.

happy.camper_6

Having written to Lloyds explaining I met the criteria for the FSA waiver on hardship cases, I recieved a letter 8 weeks later telling me that they could not see how £205 per month in charges was causing me difficulties and therefore they would not look at my case! So I then wrote to the Financial Ombudsman who initially took on my case. However, today I received a letter from them saying that because I am no longer in debt to Lloyds that I am therefore not in financial difficulty and therefore they do not have to deal with my case! So I am now in the process of printing off all my bank statements, from all my accounts, not just with Lloyds, getting copies of all my payslips, and a list of all my income and outgoings to send to the Ombudsman to appeal against them turning down my case.

By the way, I am claiming for £3600.

Cheers everyone and good luck with ur cases x

natweststaffmember

happy.camper wrote: »

Having written to Lloyds explaining I met the criteria for the FSA waiver on hardship cases, I recieved a letter 8 weeks later telling me that they could not see how £205 per month in charges was causing me difficulties and therefore they would not look at my case! So I then wrote to the Financial Ombudsman who initially took on my case. However, today I received a letter from them saying that because I am no longer in debt to Lloyds that I am therefore not in financial difficulty and therefore they do not have to deal with my case! So I am now in the process of printing off all my bank statements, from all my accounts, not just with Lloyds, getting copies of all my payslips, and a list of all my income and outgoings to send to the Ombudsman to appeal against them turning down my case. If anyone has anymore advice for me please email me on

By the way, I am claiming for £3600.

Cheers everyone and good luck with ur cases x

PLEASE REMOVE YOUR EMAIL OFF YOUR POST. You have no idea who anyone is on here.
Do you have priority debt arrears(mortgage/rent, council tax, utilities)?
Are any of the arrears being paid back?
you need to argue with the FOS that a lifestyle issue, for example, loss of a job lead to a lowering or loss of income leading to charges which lead directly to a further reduction of your income and a build up of arrears.

natweststaffmember

mitzymay wrote: »

Hi,
Just been looking at my weekly email from this site and I felt I had to comment on the hardshipc ase I put in to Natwest over my bank charges. I am currently in an IVA due to my ex-partner using my details etc for credit. I followed the hardship claim on this site and was basically told I had enough money to live on (£200 per month) and if not then I should consider going bankcrupt! Great advice from the bank that is killing us with adverts on how helpful and rewarding they are, NOT!

So for now my case of just under £2000 is on hold, not that this amount may look a lot to others or the idiots at Natwest but to me it would help greatly for my new heating boiler I need.

Which address did you write to and when did you receive a written response?

h_p_swymm

Firstly this is just an opinion.
Secondly I am on the customer's side because I believe in "treating customers fairly", although it might not immediately appear so from this missive.

1. I work in a bank complaint handling area. I see many complaint claims. From experience most claimants do not deal with their problems in an objective way. They automatically blame the bank for their debt situation but fail to come up with any rational argument to demonstrate that this blame might be correctly placed. They automatically assume that they are entitled to their a refund of their charges. If they do come up with a record of circumstances that show what they allege was the situation at the time, they often get the facts wrong (not necessarily their fault) and they always completely ignore the fact that there was a set of terms and conditions when they signed up for the account.

2. For instance, if I were to look into a claimants account and I see a history of overspending, I am hardly likely to believe that it was the bank's fault that the customer was now in debt. They knew they were over spending.

a. Mistakes due to temporal mishaps is another matter, i.e. you go overdrawn by a few pounds for a few days, and don’t notice because you forgot that new dierect debit, or were away abroad, etc.

b. Also (a digression) – the second you go overdrawn for a few pence or a few pounds you get a fee or a charge on your account. But when you pay in a cheque, it takes five days to clear (or at least three), and you the customer are expected to accept this.! (Barclays noticed this and have change their ways to accommodate their administrative needs whilst also turning this discrepancy into a valuable service to their customers. Customers get five days to correct their overdraft).

3. The customer/claimant blames the situation on bank charges made on their account. The charges were made because the account went overdrawn and their was no agreement in place for an overdraft - it would not make any difference if the overdraw on the account was a penny or a pound or hundreds; it is now a situation handled by computers not people, and computers don't care.

4. It has always been the customer's responsibility to run their bank account well. What has happened over the year's is that the human side of banking at a branch has disappeared. Branch manager's powers for dealing with or resolving customer's problems on an individual and personal basis have been eroded and have all but disappeared (by policy for profit changes). But banks are still obliged to address a customer's problems in managing there account.

5. However if the customers could show that having got into this debt situation with their account and having tried to sort the situation out with their bank, that the bank then failed to help them address their problems; then that is a different matter. Also demonstration of misinformation given at branches would help any claim, but simple hearsay will carry little weight.

6. Depending on the bank I would think that it must now be almost impossible to get any help directly at a branch regarding a claim. Banks are now, if they were not from the beginning, dealing with bank charges claims from centralised adminstration offices purely because of the vast numbers of claims.

7. Hardship complaints have to show that the customer is in hardship, saying your in hardship is not good enough; the customer's account history will be scrutinised for information that could evidence that there is or was a genuine hardship situation. Customer's can also show evidence in the form of an I&E (formalised income and expenditure form), this is downloadable from the internet or can be obtained from your bank. (Beware the I&E is a double edged sword - the first thing a bank is likely to do with the information is use it to come back to the customer to ask how much they are willing to pay per month out of any remaining disposable income in order to reduce their debt.) One pound a month would be about the minimum, so the I&E would have to demonstrate that this was a reasonable sum for the bank to ask for when negotiating with the bank. (Never agree to an IVA, always set up an informal agreement if possible, informal agreements are flexible and are not for life).

8. The customer's final destination for their complaint is the FOS (Financial Ombudsman Service, a completely free and impartial service to the customer). After a period of eight weeks from the beginning of the complaint i.e. the customer's first complaint letter, regardless of any outcome in dealing with the bank, (and within this period of time the bank has the right to try and resolve a customer's claim) the customer has the default right to take their claim to the FOS. (Normally there would have to be a 'final decision' letter from the bank about the claim, however there cannot really be a final decision by the bank when the 'general six years of bank charges complaint' is on hold other than to say their case is on hold).

9. Those cases where the customer has made a claim and been told that their case is 'on hold' awaiting the outcome of the Court case will of course receive a result when a 'decision' is made by the Court, which may be in October 2009.

10. Those cases currently claiming hardship; hardship under the FSA waiver; or hardship due to a vulnerability such as a disability of some sort; or any other viable hardship situation: - the bank is immediately obliged to look at the case from this point of view, but it does not mean that the bank was responsible for that 'hardship'. A payout would only result if the customer could show ((or the bank was exposed to showing by their own records that there was an occurrence of either - bank errors; or that the historic bank account information or possibly even lack of information/action or misinformation as a possible cause for their customer's hardship, either when they initially examine the claim or when the case is examined by FOS later)) that it was the banks actions that contributed to the customer's situation thus causing or worsening the hardship that the customer was in.

11. Current FOS decisions on hardship would indicate that if the bank has helped the customer by formulating a way that the debts can be 'managed' to be paid off, then this is a beneficial result for the customer, and that is likely to be the end of their FOS hardship claim (result no charges paid back under hardship). If the customer can clarify their situation to show that the bank did indeed - not take any helpful action when they should have done leaving the customer in a hardship situation and/or actually made their situation worse; then, in this circumstance I have seen claimants paid back their charges as ordered by the FOS.

12. The situation for individual claimants is quite complex, I have only scratched the surface of these claim scenarios. Claims have been made, - prior to the Court action; during the Court action; on accounts with debts that have been handed to debt-handling departments within banks; accounts that have been pursued by appointed bank solicitors in court; accounts where the debt has been sold off to a debt-collection agency; accounts that were already closed at the time of the claim; accounts that have been closed since the time of the claim, and a number of the main high street banks have changed their terms and conditions/ overdraft authorisation processes since the start of the Court case - and so it goes on, which makes the whole issue very varied and extremely complicated.

13. However to recap there may be a good result in October for customer's (but not investor's) and the banks will be order to pay out on up to six years or more charges to some degree. This will clarify the situation for the FOS claimants as well.

14. If the Court decision goes against the banks, which in my opinion it should, then the total payout across all the banks will be totalled in billions of pounds stirling. Indeed for some of the larger banks, the sum for them individually, could be in the billions.

15. Working out the payment accurately and fairly to all customers and then paying the customers/claimants could be likely to take a number of years with interest accruing possibly at the penalty rate of 8% all the while. The effect of the result, ‘to pay back billions of pounds’, will immediately damage the credibility of some banks which will be reflected in the financial markets; so Mr Investor, be ready for a dive in the value of your savings in shares and funds about October/November 2009 if a decision against the banks is given!

I do not guarantee the accuracy of my opinions expressed here - h p swymm

happy.camper_6

I failed to mention in my earlier post that the reason my account went overdrawn was due to the bank reducing my overdraft limit with no notice leaving me 4p over the new overdraft limit - this then caused them to slap on a series of charges, then they charged me for the charges etc.

natweststaffmember

h_p_swymm wrote: »

Firstly this is just an opinion.
Secondly I am on the customer's side because I believe in "treating customers fairly", although it might not immediately appear so from this missive.

1. I work in a bank complaint handling area. I see many complaint claims. From experience most claimants do not deal with their problems in an objective way. They automatically blame the bank for their debt situation but fail to come up with any rational argument to demonstrate that this blame might be correctly placed. They automatically assume that they are entitled to their a refund of their charges. If they do come up with a record of circumstances that show what they allege was the situation at the time, they often get the facts wrong (not necessarily their fault) and they always completely ignore the fact that there was a set of terms and conditions when they signed up for the account.
I was actually with you up to the point you said the above in bold which is what the OFT test case is about, ie are the terms under which someone has been charged assessable for fairness under UTCCR 1999. You do not appear to understand.
2. For instance, if I were to look into a claimants account and I see a history of overspending, I am hardly likely to believe that it was the bank's fault that the customer was now in debt. They knew they were over spending.
What about the reasons behind that? Did you ask?
a. Mistakes due to temporal mishaps is another matter, i.e. you go overdrawn by a few pounds for a few days, and don’t notice because you forgot that new dierect debit, or were away abroad, etc.

b. Also (a digression) – the second you go overdrawn for a few pence or a few pounds you get a fee or a charge on your account. But when you pay in a cheque, it takes five days to clear (or at least three), and you the customer are expected to accept this.! (Barclays noticed this and have change their ways to accommodate their administrative needs whilst also turning this discrepancy into a valuable service to their customers. Customers get five days to correct their overdraft).
Again their terms have not been tested in court.
3. The customer/claimant blames the situation on bank charges made on their account. The charges were made because the account went overdrawn and their was no agreement in place for an overdraft - it would not make any difference if the overdraw on the account was a penny or a pound or hundreds; it is now a situation handled by computers not people, and computers don't care.
They blame them probably because of the amount and the interplay of charges. I do agree with you on the last point re computers.
4. It has always been the customer's responsibility to run their bank account well. What has happened over the year's is that the human side of banking at a branch has disappeared. Branch manager's powers for dealing with or resolving customer's problems on an individual and personal basis have been eroded and have all but disappeared (by policy for profit changes). But banks are still obliged to address a customer's problems in managing there account.
totally agree
5. However if the customers could show that having got into this debt situation with their account and having tried to sort the situation out with their bank, that the bank then failed to help them address their problems; then that is a different matter. Also demonstration of misinformation given at branches would help any claim, but simple hearsay will carry little weight.
That is about evidence of hardship and furthermore, about circumstances leading to less money in their account
6. Depending on the bank I would think that it must now be almost impossible to get any help directly at a branch regarding a claim. Banks are now, if they were not from the beginning, dealing with bank charges claims from centralised adminstration offices purely because of the vast numbers of claims.
Banks should at branch level be able to provide a central point for all claims of hardship otherwise we are into FSA Waiver breach territory.
7. Hardship complaints have to show that the customer is in hardship, saying your in hardship is not good enough; the customer's account history will be scrutinised for information that could evidence that there is or was a genuine hardship situation. Customer's can also show evidence in the form of an I&E (formalised income and expenditure form), this is downloadable from the internet or can be obtained from your bank. (Beware the I&E is a double edged sword - the first thing a bank is likely to do with the information is use it to come back to the customer to ask how much they are willing to pay per month out of any remaining disposable income in order to reduce their debt.) One pound a month would be about the minimum, so the I&E would have to demonstrate that this was a reasonable sum for the bank to ask for when negotiating with the bank. (Never agree to an IVA, always set up an informal agreement if possible, informal agreements are flexible and are not for life).
I can see what you are saying
8. The customer's final destination for their complaint is the FOS (Financial Ombudsman Service, a completely free and impartial service to the customer). After a period of eight weeks from the beginning of the complaint i.e. the customer's first complaint letter, regardless of any outcome in dealing with the bank, (and within this period of time the bank has the right to try and resolve a customer's claim) the customer has the default right to take their claim to the FOS. (Normally there would have to be a 'final decision' letter from the bank about the claim, however there cannot really be a final decision by the bank when the 'general six years of bank charges complaint' is on hold other than to say their case is on hold).
I personally think it is an essential component when going to the FOS ie a "final response letter"
9. Those cases where the customer has made a claim and been told that their case is 'on hold' awaiting the outcome of the Court case will of course receive a result when a 'decision' is made by the Court, which may be in October 2009.
No they won't as this is stage 1 of 2 ie the Court will decide if the OFT can assess terms for fairness and then we are into the final part of the case.
10. Those cases currently claiming hardship; hardship under the FSA waiver; or hardship due to a vulnerability such as a disability of some sort; or any other viable hardship situation: - the bank is immediately obliged to look at the case from this point of view, but it does not mean that the bank was responsible for that 'hardship'. A payout would only result if the customer could show ((or the bank was exposed to showing by their own records that there was an occurrence of either - bank errors; or that the historic bank account information or possibly even lack of information/action or misinformation as a possible cause for their customer's hardship, either when they initially examine the claim or when the case is examined by FOS later)) that it was the banks actions that contributed to the customer's situation thus causing or worsening the hardship that the customer was in.
Totally agree with you on this point which I have highlighted because it is absolutely on the mark with the key word being "worsening".
11. Current FOS decisions on hardship would indicate that if the bank has helped the customer by formulating a way that the debts can be 'managed' to be paid off, then this is a beneficial result for the customer, and that is likely to be the end of their FOS hardship claim (result no charges paid back under hardship). If the customer can clarify their situation to show that the bank did indeed - not take any helpful action when they should have done leaving the customer in a hardship situation and/or actually made their situation worse; then, in this circumstance I have seen claimants paid back their charges as ordered by the FOS.
yep
12. The situation for individual claimants is quite complex, I have only scratched the surface of these claim scenarios. Claims have been made, - prior to the Court action; during the Court action; on accounts with debts that have been handed to debt-handling departments within banks; accounts that have been pursued by appointed bank solicitors in court; accounts where the debt has been sold off to a debt-collection agency; accounts that were already closed at the time of the claim; accounts that have been closed since the time of the claim, and a number of the main high street banks have changed their terms and conditions/ overdraft authorisation processes since the start of the Court case - and so it goes on, which makes the whole issue very varied and extremely complicated.

13. However to recap there may be a good result in October for customer's (but not investor's) and the banks will be order to pay out on up to six years or more charges to some degree. This will clarify the situation for the FOS claimants as well.
No they won't pay out either way on the current decision.
14. If the Court decision goes against the banks, which in my opinion it should, then the total payout across all the banks will be totalled in billions of pounds stirling. Indeed for some of the larger banks, the sum for them individually, could be in the billions.

15. Working out the payment accurately and fairly to all customers and then paying the customers/claimants could be likely to take a number of years with interest accruing possibly at the penalty rate of 8% all the while. The effect of the result, ‘to pay back billions of pounds’, will immediately damage the credibility of some banks which will be reflected in the financial markets; so Mr Investor, be ready for a dive in the value of your savings in shares and funds about October/November 2009 if a decision against the banks is given!

I do not guarantee the accuracy of my opinions expressed here - h p swymm

see above and will carry on with this shortly/ I edited some of it but I actually think the parts on hardship are very good but your OFT test case knowledge needs improving (god I know that sounds patronising but I am late for the bus commenting on this one

esmerellda

just picking up on this point

''I see a history of overspending''

how do you determine what overspending is ?


re

''
5. However if the customers could show that having got into this debt situation with their account and having tried to sort the situation out with their bank, that the bank then failed to help them address their problems; then that is a different matter. .'

massive problem, the banks don't care, you are encouraged to telephone if you are having trouble but in many cases then get treated badly when you do and no help is given, and oh dear they lost the recording. happens FAR too much. If someone calls in cause theres been a !!!! up and the bank will be taking most of their income in charges that month, how often do the bank say ' oh yes that is a bit ridiculous we'll refund the charges so you can eat' ???

Re point 8 and natties comment '' I personally think it is an essential component when going to the FOS ie a "final response letter" final response would only apply to the banks final response in relation to hardship, not general charges complaints.

10. completely agree and goes back to point 5.

11. hsbc are the worst for this with their 'managed loans'

12. extremely so.

13. no they wont pay out on octobers judgement theres the next stage to go yet, and when they do it will not be six years - it will be back to july 2001 - however long the test case takes. It shouldnt be to some degree either - it should be the entire amount plus interest charged on those charges, plus compensatory interest (probably 8% PA) - as if the terms are deemed unfair they cease to have ever existed.

14. could be in the region of 54 billion if entirely equitable, thats doubtful tho so looking at 20/30 billion.

15. not really - as you said earlier - they have computers and already have systems in place or being put in place to deal with the refunds expeditiously (as per the waiver) IF its an automatic refund to every customer of all charges since july 2001 (which is the right and legal outcome that should happen) it will be a computer programme sorting all accounts and charges calculating interest nd applying refunds to accounts if still in use or printing cheques if not (obv that might tke longer to get sent out) but otherwise shouldnt take more than 6 months.

If its going to be a refund on application then of course it will take years s there will be DPA requests and letters to go first and half the people who are due refunds won't apply. refund on application would be completely ridiculous IMO, butits down to the courts,banks, fsa and oft to decide how it happens.

onlypaddy

natweststaffmember wrote: »

I hope you didn't apply to lift the stay because it would have cost you money and you would not have been successful and lost the money to attempt to lift the stay.

I did apply but also filled out the forms showing the court I had no money to pay it and the fee was waived

natweststaffmember

onlypaddy wrote: »

I did apply but also filled out the forms showing the court I had no money to pay it and the fee was waived

If you have you are wasting your time. No Financial Hardship case will have a stay lifted. There is no case law for doing so. The Financial hardship exemption is based on financial regulation and not case law. Apologies for being blunt but when you fail to get it lifted then you will know that you were warned.
Moore-Blix who is deputy Master of the Rolls seemed to give an indication that all case on hold or stayed pending the OFT test case issues was a reasonable step to take. This advice was given February 2009 and still remains today.