Continual payment authority - Cancelled card

HillmanImp_2

Good morning,

Whilst I have just registered and this is my first post, I have used this forum a lot in the past as it proves very helpful in many financial (and work) matters.

I have searched the forum and unusually cannot find a post about a situation similar to my own.

My problem is, I cancelled my HSBC credit card back in November 2011. As such I was surprised to receive a bill for nearly £80 in March 2012. I have spent the last 2 months trying to dispute the payment explaining that my card was cancelled but with little success. All I got was people asking me to make payment etc, no explanation at all.

Getting fed up I dragged myself into a branch to speak to someone in person and that kindly helped me out, agreed that the card should have indeed been cancelled in November and that she would submit a complaint on my behalf to hopefully get the money refunded.

However, the HSBC complaints department have rung me up and said that despite me having cancelled the card and not having any credit with HSBC they are obliged to pay the amount to the internet company as I entered an agreement with them.

Is this right? I have a few problems with this. These are:

1: If I no longer have a credit card then how can they make payments on it. If I was up to my credit limit I am sure they would not have paid it? Why pay it when I have no limit at all?

2: Why can companies do this? If someone is going to take regular payments then should this sort of thing not be set up in writing like a Direct Debit? This is not the first time this sort of thing has happened to me and it seems to be starting to get a bit more common. At very least I would expect something in writing advising me that I am going to have the money deducted prior to it happening. What if I had cancelled the card an moved house? The first I would have heard of this would be when the debt collectors were knocking at my door a year later?

3: What do the banks receive to say one of these has been set up? I asked the bank if they could tell me if there were any more of these authorities on my account and they could not tell me. Should they not be able to say whether or not I am likely to have any future payments coming out? Would it not be a good idea to say this when cancelling the card?

Whilst I believe I will have to pay the money I think the entire process is pretty dodgy and open to corruption.

What opinions experience and/or advice do people on here have about these?

Scotty

jonesMUFCforever

You signed up for a continious payment authority.
It makes no difference that you closed or cancelled the card - if you did not cancel with the retailer they will debit the card and you are liable to pay.
This is of course unless you can show proof that you have tried to cancel direct.

The good news going forward is that now a lot of banks are allowing customers to cancel CPA by putting a stop on FUTURE payments - check whether your bank card allows this.
I know Barclaycard and LTSB do this.

So your anger should be aimed at who took the money off your card not your card lender.
IMO pay up now before it effects your credit rating and try to reclaim directly from the company who took the money.

agrinnall

There are dozens, probably hundreds, and possibly thousands of threads about CPA on here so I don't really think you looked very hard. Jones has explained the situation, the only thing I would add is that since 2009 all banks have been required to cancel CPAs from their end if you specifically request it (not just by cancelling the card) although it seems this had only become common knowledge in the last few weeks and until the recent publicity many banks were ignoring this requirement.

ggg07

I've had a situation this week whereby I got caught by an internet scam and unwittingly started a CPA/recurring payment on my debit card. The FSA clearly states that a bank/card issuer MUST stop payments if you request this. The law changed in 2009 but it seems banks have been slow to act.