LLoyds irresponsible lending

Thea

A friends work colleague has managed to get himself in debt with lloyds tsb.

He is a simple man, not much common sense and has held down a factory job for the last 40 years (been there ever since he left school). Makes around a £1000 a month if that. Due to this his mother and my friend have control of alot of his finances, making sure he has money for food at work and his bills are paid etc

He was ill last year and off work for about a month. During this time he was able to go into his bank and take out 2 loans- one for £2000 for 'home furnishings' and the second one for 'electrical equipment'. They then switched his bank account to one with extras like mobile phone insurance (his phone is worth about £30), some sort of car insurance (he has no car, no driving licence) and various other bits he will never use. They also linked this new account with a savings account which they moved £400 each month and to which he has promptly been withdrawing and spending. So on top of the two loans he was a £1500 overdraft.

Now because he has not been paying this back on his overdraft they have been charging him £10 a day.

The bank are quite insistant he asked for this things, he may have asked for more money, but does not have the sense to opt for these things. He even keeps referring to the lady who signed him up for all these things (apparently she has left). After been confronted by the gentleman in question and his mother they saying they may be able to get the loans dropped but its unlikely.

So my questions are: can they get away with this and what course of action does he have? He is very stubborn but even he realises how big of problem this is which is why its coming to light. You can tell just by talking to him that he is not a full shilling and i think lloyds have been highly irresponsible in leading him any money on an income of £1000 per month before bills.

Any suggestions on what can be done? His mother is currently planning to contact social services and the bank have suggest citzens advice.

Thanks

jason1231972

Does he have actual, bona fide, certified learning difficulties? Would these be absolutely apparent to the untrained eye? (bank staff). Just being 'a bit thick' or lacking in common sense doesn't count.

Referring to a salary of £1,000 per month as too low to borrow this amount is very vague without context - I earn a little less than this, and am more comfortable than many people I know who earn much more but have much higher commitments and outgoings.

opinions4u

How are bank staff meant to assess his mental capabilities?

Most customers would be highly offended if a bank seller (on less than £1,000 a month net) decided not to do business with them. "I'm sorry Mr Customer, I can't upgrade your account because you come across as a bit thick".

He can complain. Somebody can hold his hand if he complains. It might be possible to get the fee paying bank account reversed and fees refunded. But he is an adult who can legally borrow money and legally spend money.

Miss_Spendalot_2

To be honest he must have been in the Bank for quite some time sorting out these finances, if he were as simple minded as you say somebody would have noticed it and I am sure that the bank employee would not have risked her job by 'coercing' him into taking out these loans if he had not come across or appeared to be astute enough to have made these decisions about his finances in the first place.

I understand he may be be unable to manage money due to somebody else taking control of that aspect of his life, but that cannot be an argument as to why he would be exempt from making financial decisions without his mothers approval.
Maybe he just wanted some money to spend on things he wanted without it being taken away from him and now he realises that he made a bit of a boo boo..

There are a lot of people who don't have much common sense but that does not make them simple or unable to make decisions..

somethingcorporate

If other people manage his finances so closely for him how did they not notice he now had £1,000s of pounds in cash to spend...

Unless he is mentally incapable (medically so) then he is an adult and needs to be responsible for his own actions. I don't see any issue with someone earning £12k borrowing £5k from a bank.

Thea

Thanks for the replies. Im not sure if he has anything diagnosed on his medical records. I guess social service will be looking for that sort of thing.

To Jason- i understand that its not necessarily the amount you borrow, but he does not save anything, that £1000 gets spent as soon as he gets paid. That is why his mother withdraws some of his money and makes sure his bills are paid and he buys food. There were some difficulties before where his council tax and rent were not been paid.

Yes he made the choice to borrow this money but with no way of paying it back. Would hate to see him end up with a ccj or something. Its a sad state and i just hope its sorted out soon.

DevCoder

A lot of mentally competent people borrow money without any means (or intention) of repaying. Think its a bit hard to blame the lender.

But best of luck.

CLAPTON

Thea wrote: »

Thanks for the replies. Im not sure if he has anything diagnosed on his medical records. I guess social service will be looking for that sort of thing.

To Jason- i understand that its not necessarily the amount you borrow, but he does not save anything, that £1000 gets spent as soon as he gets paid. That is why his mother withdraws some of his money and makes sure his bills are paid and he buys food. There were some difficulties before where his council tax and rent were not been paid.

Yes he made the choice to borrow this money but with no way of paying it back. Would hate to see him end up with a ccj or something. Its a sad state and i just hope its sorted out soon.

from what you say, a CCJ would suit the situation as it would prevent him accessing any further credit.

dealer_wins

The bank would have conducted a full "income and expenditure" so unless he lied to them the loan was affordable on his income and outgoings.

pvt

Thea wrote: »

Im not sure if he has anything diagnosed on his medical records. I guess social service will be looking for that sort of thing.

I'm not sure why. Would you be happy if social services took at look at your medical records because you took out a payday loan for example? At 4,000%+ interest that would be a far greater indication of impaired mental capacity.

chesky369

I suspect that social services won't be particularly keen to get involved, unless they consider the man is a danger to himself or others - and I don't mean financially. They're much too stretched dealing with really difficult cases and those people in our society who have nobody to help them.