Untested Legal Arguement (Hardship & Credit Reference Agency files)

hicskis

Fair enough natweststaffmember - a person will always be liable for the principal sum that they borrowed, but it may, just may be possible to get the charges and interest removed and credit files repaired....

Just think about it a little - what that could mean.

Re - read my last response and then look at sections 3 & 4 of the Lending Code in regards to "Credit Reference Agencies" and "Credit Assessment" that you have attached to your name on this thread. Think about when an account is in dispute and what happens with a person's data in regards with the Credit Reference Agencies.

The debate on unfair charges and the terms that invoke them has not put a stop to this practice yet.

Let's try to think outside the box a little. Any lawyers out there that can give some feedback to my idea(s)?

BenS1

natweststaffmember wrote: »

I don't agree with the way you are arguing financial hardship and the point you made in that letter is a moot point cos no once tries to get into a cycle of charges but the charges themselves are not the reason you are in financial hardship. The reason is that income outweighs outgoings leading to arrears on priority creditors.

Not neccessarily. At the time I was a student who had no access to student loans due to my parents income not fitting into the eligable criteria. At the time, I was not financially aware of consequences but it stinks that they can get away with adding on charges to an already overdrawn account.

The quote I put is only a bullet point from my letter. In particular, I am rather peeved about the direct debit charge as just because I made a payment over the phone, they decided to set a direct debit for the new ones. The point is, that that direct debit charge should not have occured.

·[FONT=&quot]I was not aware of, nor did I authorize a direct debit from XXXXXX XXXX being taken from this account. In actual fact, payment to XXXXXX XXXX was made from an account in another financial institution from November 2004 onwards. I find a £35 charge for an unpaid direct debit which I did not authorize ridiculous and unfounded with regards to the real cost to [Bank name] to check if there were enough funds to pay this direct debit. I therefore believe I should not be charged for this, as this charge is approximately 9% of the outstanding amount owed to this account.[/FONT]

·[FONT=&quot]The charges are disproportionate: Following the charge on 26th July 2006 to allow cheque XXXXXX whilst overdrawn, this sent me over my overdraft limit. Thus, this £30 charge made me £30 over my overdraft limit. [/FONT]

·[FONT=&quot]Following the £30 charge mentioned above, this has led to £20 charges in each month for being above the overdraft limit. This created a cycle of charges which has caused me to be overdrawn more than how much I should have been. [/FONT]

·[FONT=&quot]The very fact that [Bank Name] decided to add the cycle of overdraft charges and the unpaid direct debit charge on the overdraft account onto what I owe to them is immoral and misleading on my files with Credit Reference Agencies. My point being that these charges make up £XXX.XX of the outstanding debt of £XXX.XX which is owed and is a breach of the Data Protection Act 1998 as the defaulted amount is inaccurate. More importantly, I should only need to repay what I owed: I did not decide to borrow funds to go over my overdraft limit, nor did I borrow funds to attempt to pay a direct debit.[/FONT]

·[FONT=&quot]At the time the account was closed, I was a student and I always tried to best of my ability to repay the amount owed and have struggled. This can be shown by the reduction of the monthly direct debit payments made to the Debt Collection Agency from £XX.XX to £XX.XX to repay this debt off. Since I graduated in summer 2009, I have been unemployed and it has made it even more of a struggle to make the monthly repayments using money from my Jobseekers Allowance benefit. As I have other payments to make, such as those to pay my share of utility and food bills, this has made it extremely hard to make sure there are enough funds to make the repayments for this account. I understand that you should have a completed income/expenditure form which I sent when I first complained about these bank charges. My circumstances have not changed, and therefore I do not see a reason why you should send me another income/expenditure form. [/FONT]

hicskis

BenS1 - Have you asked the bank to provide evidence that you authorized them to set up that Direct Debit. If they cannot prove that you authorized them - and how can they because you didn't - then they made a mistake - which they now have to rectify:

1. That means any fees or interest you paid must be refunded;
2. That means your Credit File must be restored;
3. It means you must be compensated for the damage that their Negligence has caused.

Ask first (by phone) as a gesture of goodwill that they do points 1 & 2 above and that they give you 10 pounds for your trouble of raising it with them.

If they refuse then immediately follow that request up in writing and DEMAND that they do that. At the same time start an accounting process that enables you to recover your costs:

a) Physical costs such as telephone calls, postage, photocopying, electricity, depreciation of your computer etc
b) Time - at 10 pounds per hour (Financial Ombudsman Service briefing note)
c) Every standard letter you send at 12 pounds per letter because that is what the banks say a letter costs
d)Damages - keep it low - a couple of hundred pounds at most.

Write first to Customer Services, then the Manager of Customer Services, then to the Chief Executive, then the Financial Ombudsman Service, then to the Small Claims Court (claims i believe under 5000 pounds). Don't mess about - if they refuse step it up a level.

Enough of you do it this way - it'll cost em'

hicskis

I've uploaded the link to the FOS briefing note as to what you can claim...

http://www.financial-ombudsman.org.uk/publications/technical_notes/distress-and-inconvenience.htm

natweststaffmember

Ben, the bank does not authorise the Direct Debit per se, but one last point before we go down that route, was the amount that the DD was for the exact amount you paid?

If the answer is yes then the direct debit originator has asked for a payment that was not cancelled or may have been a new instruction. The bank have charged for consideration of whether to pay or not pay.

If the DD amount is different then you are looking at a fraud case.
I give up. I have spent years trying to get people to understand the mechanisms of how they are charged, what happens and even if you make a payment to a mobile phone provider they may still claim the DD from the bank which if not cancelled could trigger a charge. Oh, well, when the FOS agree with the bank we will see what comments you have to make about the FOS.

hicskis

In the United Kingdom, Direct Debit requires the customer to authorise a Direct Debit Instruction with their bank - i enclose a link for your ease or reference:

http://en.wikipedia.org/wiki/Direct_debit

noh

hicskis wrote: »

In the United Kingdom, Direct Debit requires the customer to authorise a Direct Debit Instruction with their bank - i enclose a link for your ease or reference:

http://en.wikipedia.org/wiki/Direct_debit

That is misleading.
What happens is that the Direct Debit is set up with the the payee.
The payee then lodges the DD mandate with the bank.
The customer has no direct contact with the bank when setting up the DD.

hicskis why do you continue to post misleading infomation?
In a previous post you said you live in Germany do you actually understand how the UK banking system works? It seems not from your posts.

hicskis

This is a direct quote from the link that i attached to my post. Read it first and then make up your own mind if i'm wrong. I do indeed live in Germany but am a UK citizen from birth. I can help translate this into english should you want.


http://en.wikipedia.org/wiki/Direct_debit


Authorization

"The biggest difference to a direct deposit is that there must be some sort of authorization for the payee to collect funds from the payer's account. There are generally two methods to set up the authorization:
One method only involves the payer and the payee. The payer simply authorizes the payee to collect the amounts due from his or her account. As the payer's bank is not involved, it can not check the payee's authorization, so other safeguards are required. This typically means that the payer can instruct his or her bank to return any direct debit note without giving a reason. The payee then not only has to pay all fees for the transaction (which can be hefty for returned direct debits) but may eventually lose his or her ability to initiate direct debits if this occurs too often. However, it still requires all account holders to watch statements and request returns if necessary.
The other method also involves the payer's bank. It requires the payer to instruct his or her bank to honour direct debit notes from the payee. The payee is then notified that he or she is now authorised to initiate direct debits transfers from the payer. While this is more secure in theory, what it can also mean for the payer is that is harder to return debit notes in the case of an error or dispute."

noh

I can read and have many direct debits set up.
The payee has no direct contact with the bank. The DD is set up with the the originator who lodges the mandate with the bank.

Most direct debits are set up using AUDDIS explained here:-
http://www.bacs.co.uk/Bacs/Businesses/DirectDebit/Services/Pages/AUDDIS.aspx


It's worth checking information at source rather than from Wikepedia.

As you can see BenS1s bank will have an authourisation to pay the DD otherwise they could not have paid it.

The question is was the DD set up fraudulently? Did BenS1 give the originator instructions to set up the DD?

hicskis

That maybe so - but you still have to authorize (agree) to it which is the basic fundamental of a contract.