Building society took £4000 out of ISA without permission

jamesd

MarkyMarkD, I'm assuming that I don't yet know what happened. So far we know that there was an error but don't know what the documents requested.

The IR guidelines do allow for an emailed request for permission to correct the error even if the funds are missing and the original mistake was by the ISA provider. It's just not something the ISA providers can do themselves without asking the IR.

The documentary evidence of all the funds being moved to the current account except the majority of the ISA funds would tend to support the view that it was a mistake by the ISA provider. The problem is what happens if the documents for the purchase of the counter cheque say to take the money from the ISA. It might come down to whose handwriting was on the counter cheque request to illustrate whether it was initially an error by the bank or the consumer.

HazDan writing "I just want them to recognise that what they have offered is not enough as they have affected my long term financial plan on savings. I mean as a first time property owner it is hard to put any money in from now on" is where we'll be left if the IR says it can't be corrected. Since HazDan is going to have trouble saving in the future HazDan can use the future years' ISA allowances to get the money back in the ISA and can receive redress for interest lost to tax while doing that.

AndyR_3

cheerfulcat wrote: »

This newsletter is five years old and the views may have changed, of course.

Here is this year's version of the same subject:

http://www.financial-ombudsman.org.uk/publications/ombudsman-news/60/60-investment.htm

BWZN93

masonic wrote: »

Maybe I'm going blind, but I can't see where the OP alluded to anything being put in writing.

All the info is printed on the withdrawal slip for the customer to sign....

masonic

jw1096 wrote: »

All the info is printed on the withdrawal slip for the customer to sign....

So you know which building society the OP banks with, then? I must say, having to sign for a withdrawal is rather a strange concept to me - I've certainly never had to do that.

RayWolfe

I have never NOT had to sign for a withdrawal unless I'm doing it online in which case I have given my permission by signing on etc.!

AndyR_3

masonic wrote: »

So you know which building society the OP banks with, then? I must say, having to sign for a withdrawal is rather a strange concept to me - I've certainly never had to do that.

I've ALWAYS had to sign for withdrawels from both banks and building societies. Thought this was normal practice...surely if you don't sign, they're leaving themselves wide open to fraud and disputes?

masonic

AndyR wrote: »

I've ALWAYS had to sign for withdrawels from both banks and building societies.

Well I may be suffering from selective amnesia, but handing my debit card over and answering some security questions is all I remember having done.

Thought this was normal practice...surely if you don't sign, they're leaving themselves wide open to fraud and disputes?

Rather like this one. If the BS can produce a signed withdrawal form showing the account the money has been debited from, then it seems strange that they should offer to pay for the lost interest. The real question is, have they admitted liability like the OP suggests, or are they making a goodwill guesture?

HazDan

I have now written to the BS and they have replied with an ambiguous letter!!! However what they say is that I signed the slip, which i'm not denying. However I had quite a long conversation with the cashier at the time about not taking too much out of the account. They agreed with me but then took it out. I think the slips they hand you are not very good as they give you an account number which the money is coming out of. This means you have to know your account numbers. They have given me £38.05 which is the amount of the interest difference between the accounts but even that wasn't clear(i'm not sure which account it was added to as it wasn't the current account)as they said it would go into the current account and I could transfer it. I have replied to their letter and if they acknowledge that their cashier made a mistake that is one thing, anything else will be a bonus at this stage. I have transfered the money back in to the ISA but had to wait until the new financial year before putting it all in as it was over £3000. I'll just wait, i'm not a person to go around sueing for compensationd but I believe that I have a case considering I had informed the BS before but was unsuccessful in getting them to listen.

HazDan

MarkyMarkD wrote: »

I think that Jamesd is assuming that the OP completed some sort of withdrawal document which would have stated how much was to be drawn and from which account.

If it was a verbal instruction, then I can't see how the bank can prove it was NOT its mistake; if they can demonstrate to the Inland Revenue that they didn't have authority to withdraw the money from the ISA account, then I don't see why they wouldn't allow the reinstatement of the ISA if the money had not been spent.

But, because the money was taken as a counter cheque and then used for a purchase, the money was spent and nothing can be done under the IR guidelines.

Like I said the first time (and thanks, masonic, for finding my other post quoting the guidelines) you can only get your ISA funds reinstated if they have not been touched - which I would say means they must have been transferred to another account where they have stayed.

Any transaction which involves converting ISA funds into cash or equivalent would seem likely to be irreversible.

Slightly by the way, but if you were intending to take the money from your current account, why did you need a counter cheque? If you'd written your OWN cheque, the mistake wouldn't have arisen. Maybe it was precisely this point which confused the bank staff?

The cheque was for the solicitor to complete the house purchase and they will not accept a personal cheque.

baby_boomer

HazDan wrote: »

I signed the slip, which i'm not denying...but...you have to know your account numbers.

Why anyone should have any sympathy with your incompetence is beyond me.