Mbna shady practices (possibly contravening regulations)

cavim

:mad:Just wanted to let other MBNA cardholders know what MBNA have done on my account so that you too can complain/request that your account be "reworked" if the same happens to you:-

May: I cancelled my direct debit for the min payt (4 days before due date), advised MBNA of the cancellation (which, according to the Ombudsman website I wasn't obliged to do) and paid the minimum payment by fast payment - sufficient funds, on time, and showing on MBNA's online system.

June: MBNA sent me my statement with the following on it:-
"Unpaid direct debit" £xxx (which was the minimum payment I'd actually made)
"Return pymnt default sum £12"
"Late default sum £12"
"Overlimit default sum £12"

The result of MBNA's actions above (and treating the minimum payment as not having been paid, even though it was recorded as paid, and on time, on the statement!) was to put me over the card limit.

I have tried numerous times by secure message and by phone to MBNA to get them to rework the statement as the min payment was made on time and the direct debit wasn't "unpaid" but had been cancelled (and they'd confirmed cancellation themselves!). I've now had to complain in writing to them but they still haven't "reworked" my statement back to May, in which case I am well under the card limit. I am also very concerned that they will be putting an adverse record on my credit records, which in no way should they be able to do.

What they have done is:-
- tell me I had to give 7 working days' notice of cancellation of the direct debit (which I didn't think I had to do and, having checked the Ombudsman site, under the terms of the direct debit guarantee a direct debit can be cancelled at any time and without giving notice - the site even refers to many companies' staff not knowing this, and MBNA told me that giving notice was in their terms and conditions - which I wasn't told about when I set up a direct debit for my own convenience, not theirs)
- calling the cancelled direct debit "Unpaid direct debit"
- worst of all, they have then added the min payment I'd already paid onto the account - so that's effectively a charge (on top of all the other charges they've listed!)
- by their actions, pushed the card amount over the limit (and not notified me of their actions in advance of the statement coming out and me seeing it)
- taken off my low rate of 6.9% for life of the balance and increased it to 26.48%.

This is obviously a common practice on their part and I think it must be breaching a few rules regarding not only direct debits (eg contravening the direct debit guarantee) but also they're slapping on a charge (the min payt) of over £200!

Don't let them do this to you - I'm not, and if they don't rework my statement quickly back to May and put things back as they were I'll be straight onto the Ombudsman with my complaint. BUT I SHOULDN'T HAVE TO DO THAT - IT'S MBNA EITHER PROGRAMMING THEIR SYSTEMS INCORRECTLY OR DELIBERATELY DOING IT TO GET MORE MONEY OUT OF CUSTOMERS (AND INVARIABLE PUT MORE PEOPLE INTO DEBT, ESPECIALLY PEOPLE WHO CAN'T WORK OUT WHAT MBNA HAVE DONE).

Apologies for appearing to shout - I'm just so angry about it and I'm having to spend hours and hours trying to sort something out that shouldn't have happened in the first place!

LoopyPrune

Why did you cancel a DD 4 days before it was due then pay it via fast payment?

Cell

But he's not in default, is he?

He's paid the contracted amount by the date required.

The direct debit is a red herring issue.

ihateyes

Cell wrote: »

But he's not in default, is he?

He's paid the contracted amount by the date required.

The direct debit is a red herring issue.

i agree... they could possibly charge fo the unpaid ddeb, as he never cancelled it with them....
i know some catalogue companies charge for a declined DEBIT CARD.
The rest of the charges should be rerversed.

cavim

Cell wrote: »

But he's not in default, is he?

He's paid the contracted amount by the date required.

The direct debit is a red herring issue.

:TThank you - someone who's actually read what I said and is supportive, unlike the other forum posters above who are totally unsupportive! How are MSE users expected to "bare all" to either get help or to help other MSE users when people post negative and critical responses. I've also been with MBNA for years, as has my partner, and they were great when offering us low rates and we were able to pay off the full accounts with the low rate terms but, now our circumstances have changed, they've increased interest rates hugely and become very heavy-handed. Mistakes and underhand practices that I probably wouldn't have noticed or experienced before (as I wasn't having to watch every penny) are now coming to light.

The point about the direct debit is that direct debits require no notice to be cancelled (other than to the bank they're issued from, depending on how fast their systems can cancel the DD - my online bank cancellation was instant). The Ombudsman website also states that no notice is required, so MBNA appear to be contravening the Direct Debit guarantee rules.

(I've also, since posting, read through MBNA's terms twice - heavy going! - and there's nothing in my copy about them requiring any notice on cancelled DDs so that was probably the "customer services area" trying it on!).

cavim

LoopyPrune wrote: »

Why did you cancel a DD 4 days before it was due then pay it via fast payment?

Because I read on the latest statement from MBNA that they now offered the fast payments facility and I thought it would prove simpler and enable me to be more in control of my money (ie me paying when I wanted, from whichever bank account I wanted to - depending on what funds were where) - rather than MBNA being in control.
Many people I know refuse to pay anything by direct debit now and, after MBNA's actions, I'm starting to see why!

cavim

ihateyes wrote: »

i agree... they could possibly charge fo the unpaid ddeb, as he never cancelled it with them....
i know some catalogue companies charge for a declined DEBIT CARD.
The rest of the charges should be rerversed.

Yes, initially I'd said to them that I'd accept a £12 charge for the "unpaid direct debit" (though really it was rejected - having been cancelled - rather than being unpaid), but that was before I read on the Ombudsman site that notice isn't required (and even more annoying that I'd told them 4 days in advance and they'd thanked me for telling them!).

Naf

cavim wrote: »

Many people I know refuse to pay anything by direct debit now and, after MBNA's actions, I'm starting to see why!

I'm one of them... although you don't know me lol.

I have had problems with billing from Orange, BT, Vodafone particularly and when I worked for Santander saw problems with many others time and time again. Including one car finance company taking all it's customers' DDs out twice in the same month. Something which many people cannot afford.

Pay everything by SO/Bill Payment, that way if they make an error you still have your money and the ball is in their court to sort it out.
I have even managed to get Orange to cancel all 3 'non DD' fees from my contracts through complaining about the service and the problems I had with their billing. Next target; BT!

jamie1983_2

I think that the practice is if you cancel direct debit then you need to inform the person its going to as well as the bank where its been cancelled, having said that the other charges i would believe are unfair. MBNA i personally never had any issue with them until about 07 when a credit card when over limit, i got a call made a payment to bring it straight back in line and no issues until a letter arrived about 2 months later from them saying your credit limit is reduced, the new limit instantly placed me straight back over and they charged however when i called them they waived the charges as a goodwill although they were responsible i didn't question because they repaid the monies.

Naf

Bear in mind that DDs begin processing on MBNA's systems the moment your bill is produced, and can be requested with the bank up to about a fortnight before they are due to come out (I have had this argument with Orange recently). So your 4 days notice would not have been sufficient for them to stop the process, and they are charging for the 'admin' involved in this process. I wholeheartedly agree that it is incredibly unfair, but this fee at least they can probably get away with. The others do seem wildly outrageous!

MarkyMarkD

The first £12 charge for an unpaid DD is not unfair.

You are misunderstanding the FOS when you say that "no notice is required to cancel a DD". That applies with respect to the bank paying the money, not to the organisation requesting the funds. Even then, you can't stop a payment when it's already been authorised - e.g. you can't call at 3pm on the day the DD was taken and say "I want to cancel" because it will have already gone through.

It is quite reasonable that MBNA need 7 days' notice. They have to produce a large "list" of payments which need to be collected, and submit it to BACS well before the funds are collected.

MBNA statements say, very clearly: "Please remember: your regular Direct Debit payment will always be taken, regardless of any additional payments you choose to make". I'd take that as meaning that once your statement has been produced, saying "The ... payment of £xx.xx will be collected from your nominated bank account by Direct Debit on or after dd/mm/yy", that means that the payment will be collected and you can't cancel the DD at all for that month.

Unless you telephoned them, asking whether the DD for that month could be cancelled, and they said "yes", then I don't see why you thought you could pay via a different method for that month.

All the other charges related to not paying by the due date. It is all very well saying that the payment appeared on MBNA's online system - did the payment appear on your next statement as having arrived by the due date? MBNA may accept Faster Payments, but banks don't always send funds via Faster Payments even when you'd expect them to do so.

The daft thing is that by "taking control back" from MBNA, by using FP instead of DD, you've simply had to pay earlier and caused all this problem!