direct debit being set up without permission

Mark_In_Hampshire

mr_mcgovern wrote: »

hi i have posted a similar question only earlier on today, but by the answers i am getting i think i need to explain my situation better.
i have realised that the company talk talk/aol have some how managed to set up a direct debit on my bank account.when i first noticed i cancelled the direct debit online. i then checked again yesterday to notice the direct debit have been setup again and that money have been taken out of my account.
the company have my bank account details from a broadband service i used to have with them which has now been cancelled over 3 years now.
on contacting talk talk/aol i was informed it was a mistake on their behalf and the money would be refunded in 10 days time.
i stated that i would accept nothing less than my own money back but wanted an explanation who and why the direct debit was setup and also without my knowledge or permission. the lady was unable to explain why
my bank has now blocked this company from trying to setup any diect debits again
i wish to know where i stand legally on the grounds of complaining
many thanks

Whether it's a mistake or actual theft is a fine line. Taking money from someone's bank account without permission is no different to taking something from someone's house without permission. However the first can be an error, the latter can't (for the sake of argument).

This page has this quote:

http://www.bacs.co.uk/Bacs/Consumers/DirectDebit/HelpCentre/Pages/CancellingPayments.aspx

Money shouldn't be collected from your account after you have cancelled and under the Scheme rules, an organisation would have to obtain your authority to reinstate a cancelled Instruction.

"Obtain your authority" is pretty weak, really. What you have to remember is that your bank don't do any due diligence when they receive the mandate request, they just assume you authorised it and set it up.

You cancel it with the bank. The payee can then just set it up again since they don't need to provide the bank with any evidentary proof of your permission.

The relevant page on the BACS website is here:
http://www.bacs.co.uk/Bacs/Consumers/DirectDebit/HelpCentre/Pages/CancellationFailed.aspx

You can get a refund from the bank of any amount paid out. However what you can't get a refund on is if no payment was made thanks to insufficient funds and you get bank charges, the bank will just point you at the payee and deny responsibility.

If you're complaining to the payee, theft is the line you should take.

Your bank are probably telling you they have blocked that payee for your protection.

The DD system is laughably weak on security and deliberately so - DD is basically a money making scheme for banks.

zppp

Mark_In_Hampshire wrote: »

Whether it's a mistake or actual theft is a fine line. Taking money from someone's bank account without permission is no different to taking something from someone's house without permission. However the first can be an error, the latter can't (for the sake of argument).

This page has this quote:

http://www.bacs.co.uk/Bacs/Consumers/DirectDebit/HelpCentre/Pages/CancellingPayments.aspx



"Obtain your authority" is pretty weak, really. What you have to remember is that your bank don't do any due diligence when they receive the mandate request, they just assume you authorised it and set it up.

You cancel it with the bank. The payee can then just set it up again since they don't need to provide the bank with any evidentary proof of your permission.

The relevant page on the BACS website is here:
http://www.bacs.co.uk/Bacs/Consumers/DirectDebit/HelpCentre/Pages/CancellationFailed.aspx

You can get a refund from the bank of any amount paid out. However what you can't get a refund on is if no payment was made thanks to insufficient funds and you get bank charges, the bank will just point you at the payee and deny responsibility.

If you're complaining to the payee, theft is the line you should take.

Your bank are probably telling you they have blocked that payee for your protection.

The DD system is laughably weak on security and deliberately so - DD is basically a money making scheme for banks.

Completely agree with Mark, you are best asking the bank to raise an indemnity now that the direct debit has been blocked. You may want to write to Talk Talk to ask them to remove your personal details from their system. (you should be able to get a DD ref number from your bank to give Talk Talk)

'Sounds like another bored troll with nothing else better to do on a sunday than make up a story. None of it adds up !'

As for those who call others trolls, I think that the phrase is bounced around too much on these forums. The OP was asking a genuine query as to what to do. May I suggest that if you don't want to partake in helping people, you don't post and troll on other people's threads.

mr_mcgovern

many thanks guys, looks like i have a nice letter to write. any tips on who to send to for aol ie do i send straight to the ceo etc.

zppp

mr_mcgovern wrote: »

many thanks guys, looks like i have a nice letter to write. any tips on who to send to for aol ie do i send straight to the ceo etc.

It is best to write to the company at their complaints unit. If you send this to a CEO, they will pass it to the complaints team anyway.

Have a look at this link I have found;

http://www.talktalk.co.uk/legal/compensation-policy

Looks like you may be able to email!

andygb

HouseHuntr wrote: »

Sounds like another bored troll with nothing else better to do on a sunday than make up a story. None of it adds up !

Please see my post (7), and then think before making accusations. It has happened to me, and one other person who I know. I believe the OP, the only reason it does not add up for you, is because you cannot add up.

Mark_In_Hampshire

andygb wrote: »

Please see my post (7), and then think before making accusations. It has happened to me, and one other person who I know. I believe the OP, the only reason it does not add up for you, is because you cannot add up.

Seconded - has happened to me before too (DDs set up again after cancellation), as well as DDs being set up that I never authorised in the first place, leading me to have the bank disable the DD facility altogether. Apart from helping the OP with their issue the thread helps other people learn about the insecurity of the system and the problems inherent to it.

Fiddlestick

mr_mcgovern wrote: »

on contacting talk talk/aol i was informed it was a mistake on their behalf and the money would be refunded in 10 days time.
i stated that i would accept nothing less than my own money back but wanted an explanation who and why the direct debit was setup and also without my knowledge or permission. the lady was unable to explain why
my bank has now blocked this company from trying to setup any diect debits again
i wish to know where i stand legally on the grounds of complaining
many thanks

Forget Talktalk and forget this 10 days nonsense.

Contact YOUR BANK and DEMAND that they return your money under the DIRECT DEBIT GUARANTEE which they are legally obliged to do.

You may have to be very insistant about not consenting to this DD and about not owing the company any money but do not back down and do not accept any excuses from the bank - you will have your money within 24 hours.

System

(1) As already stated, under the Direct Debit Guarantee, your bank must immediately reverse, no questions asked, any direct debit you say is mistaken. (The bank then pursues the org. that took the direct debit. If this org. claims that it was in the right, it can pursue you by other means for payment and compensation. It can also tell your bank that you have abused the direct debit guarantee.)
(2) If the org. that took the direct debit is in the wrong, you can demand compensation from it for your wasted time and distress. I successfully did this from the then Abbey when a customer of theirs had an account number similar to ours, and Abbey set up a direct debit on our account instead of their customer's. If you want to take it that far, you can threaten to sue talktalk in the County Court (small claim) for their negligence in taking money from your account without your authorisation. You'll need to check the correct legal name and address of the company that took the direct debit.
(3) Banks accept without question direct debits set up, and DD payments taken, by authorised orgs, and rely on their customer to complain if there is a mistake. The org. setting up the direct debit should check that the account name matches, but in my case did not. Banks do not normally notify the customer when a new direct debit is set up. If you have on-line banking, you may be able to see a list of current direct debits. If so, it is worth checking this say every month or so.

andygb

YoungNick wrote: »

(1) As already stated, under the Direct Debit Guarantee, your bank must immediately reverse, no questions asked, any direct debit you say is mistaken. (The bank then pursues the org. that took the direct debit. If this org. claims that it was in the right, it can pursue you by other means for payment and compensation. It can also tell your bank that you have abused the direct debit guarantee.)
(2) If the org. that took the direct debit is in the wrong, you can demand compensation from it for your wasted time and distress. I successfully did this from the then Abbey when a customer of theirs had an account number similar to ours, and Abbey set up a direct debit on our account instead of their customer's. If you want to take it that far, you can threaten to sue talktalk in the County Court (small claim) for their negligence in taking money from your account without your authorisation. You'll need to check the correct legal name and address of the company that took the direct debit.
(3) Banks accept without question direct debits set up, and DD payments taken, by authorised orgs, and rely on their customer to complain if there is a mistake. The org. setting up the direct debit should check that the account name matches, but in my case did not. Banks do not normally notify the customer when a new direct debit is set up. If you have on-line banking, you may be able to see a list of current direct debits. If so, it is worth checking this say every month or so.

I have been told exactly the opposite by my bank the Nationwide. They have left it up to me to contact the other side when a DD was taken "accidently on purpose".

Mark_In_Hampshire

Oddly enough most of my DD issues were with Nationwide. IIRC what happened was that a DD was set up without my knowledge/consent and two attempts were made to debit funds both of which failed.

I got charged something like 37.50 * 2 = 75.00 by Nationwide which took me just beyond my OD limit.

I then got pursued by their debt recovery department.

I refused to clear the amount because I wasn't going to pay it, stated that they were in breach of their contract to me because of their failure to exercise due diligence, and then got a court summons for the overdraft amount including the fees. By then I'd jumped ship to another bank.

I contested it, heard nothing more, nothing appeared on my credit history and I didn't have to pay anything back (circa £500 I think) so it worked out well for me. Whether that was the right thing to do or not I still don't know