Charges refunded. But they now want them back.

LeeSouthEast

A better idea is for the debtor to limit the debt they build up. I've got the potential to do 300k of debt. I choose not to.

Personal responsibility and all that.

esmerellda

If they paid off the debt direct David, then the bank wouldnt have the opportunity to add more charges to the account while it waits for you to pay it off. PLUS it is your money, and if the bank pays itself off first then you might complain as you might have higher priority debts the money is needed for - such a rent arrears/mortgage/council tax etc. So at least this way they give you a choice, but it does rely on peple being responsible and understanding that the debt isnt clear just because they have a cheque for the charges.

davidgmmafan

I agree with the first point, of course they want to continue adding charges and interest.

However I dis-agree with the second. In this case it was the banks money, and as the claim was for a refund of charges they should've taken their money off the top and any excess go to the customer. To do it this way is manifestly stupid at best, or at worst designed to decieve the customer and allow the bank to come back for another go.

I'd complain about this point out the stupidity, and push for some redution in the balance, going through the FOS if neccesary.

enamae

davidgmmafan wrote: »

However I dis-agree with the second. In this case it was the banks money, and as the claim was for a refund of charges they should've taken their money off the top and any excess go to the customer. To do it this way is manifestly stupid at best, or at worst designed to decieve the customer and allow the bank to come back for another go.

This is wrong. Had the bank paid off the overdraft first, this would have meant that they had classed this as a priority debt over and above any others such as rent/mortgage, council tax or energy.

A lot of people have complained previously when the banks have paid refunds into accounts where charges have been applied as they have been unable to clear or reduce priority debts.

After paying priority debts, any money left over should have gone towards paying off the overdraft and an agreement reached to pay off the rest.


enamae

natweststaffmember

enamae wrote: »

This is wrong. Had the bank paid off the overdraft first, this would have meant that they had classed this as a priority debt over and above any others such as rent/mortgage, council tax or energy.

A lot of people have complained previously when the banks have paid refunds into accounts where charges have been applied as they have been unable to clear or reduce priority debts.

After paying priority debts, any money left over should have gone towards paying off the overdraft and an agreement reached to pay off the rest.


enamae

If the bank refund charges they have the right to offset any refund against any money owed and most bank did this prior to the OFT test case and during it with regards to financial hardship.

enamae

natweststaffmember wrote: »

If the bank refund charges they have the right to offset any refund against any money owed and most bank did this prior to the OFT test case and during it with regards to financial hardship.

Sorry my mistake. I did know about the right of offset, but presumed that the Banks wouldn't use this when a claim was made due to hardship.


enamae

natweststaffmember

enamae wrote: »

Sorry my mistake. I did know about the right of offset, but presumed that the Banks wouldn't use this when a claim was made due to hardship.


enamae

I honestly believed exactly the same thing as you enamae(hello and nice to see you about here as well, cos I know your name well from another forum). I spoke to the FOS at that time re the bank making themselves priority creditors and it right that they have the right to offset any refund against any monies owed.

esmerellda

They do have the right but many banks didnt offset and in hardship cases gave the refunds directly to custs to do with as they wanted (paying off more urgent debts) and many custs argued for exactly this when offered hardship payments - A&L have said that their policy on hardship was to refund directly to the cust regardless of the debt at the bank. These A&L cases (theres a couple sprung up) ARE where the bank have sent the refund directly to the customer and the debt / overdraft with the bank has remained, continuing to incur interest and more charges in some cases, they are now going through lifting the stop on accounts and recommencing debt collection activity.

No one should be worried about banks reclaiming goodwill gesture refunds off of them, as they just aren't, they are simply beginning to chase overdraft debts that have been on hold for the past couple years.

LordLee

So can i argue that i will payback the amount at time of refund and any extra is not to be repaid?

esmerellda

If they froze your account due to the dispute at the time of the refund then it should not of been increasing, it really depends what you arranged with them.

It may have only been frozen to the point they issued your refund (thus resolving your complaint) in which case you would be liable for further interest added to the account since then. You can argue against additional charges being added since you stopped using the account.

You need to make a repayment offer before this goes to default and DCAs and messes with your credit file. You also, so you know whats gone off, need to send a new SAR for the info on the account, or just ask them for a breakdown/list of transactions for the last year or so so you can see how/why its increased.