Unauthorised loans and insurances

The_Famous_Cash

My son is registered disabled. I act on his behalf in any financial matters because he does not fully understand them. I wrote a letter to Lloyds TSB in 2010 bitterly complaining he had been charged £30 by an error. They were left in no doubt I was responsible for my son's transactions and had a legal document (although not a lodged power of attorny) to verify the fact.
This year, quite by accident I discovered they had mis-sold him various insurances. (He lives in a council rented flat and has no dependants). He was also mis-sold THREE loans. £1,000 then £4,000 then £7500.99 four months later. Each designed to "pay off" the previous loan. He has no clue how much he has to repay or over what time.

Further they charge him per month to repay loan but charge him £25 "loan fee", £17 "account fee", £5 for ?, Interest on authorised overdraft and interest on unauthorised overdraft.

Obvious mis-selling, without my authority. He has been offered a FULL REFUND of the insurances, an apology for the admitted mis-selling and token compensation.

The other section of the bank say, "he signed for loans so he knew what he was doing".

Just about to let the Ombudsman deal with it but should I ask (on my son's bnehalf, for compensation? What would be appropriate?

opinions4u

Do you want the FOS to reach a different decision to the bank's own complaints process?

jamesd

The FOS cases 50/4 and 50/5 may be of interest.

Saying that someone with a known mental capacity issue signed for a loan so he must have known what he was doing is not an appropriate response because the ability to sign is not related to the ability to understand what is being signed.

You may also find these of interest:

Office of Fair Trading Mental Capacity Guidance for Creditors - Quick reference guide
Office of Fair Trading Mental capacity - OFT guidance for creditors

debtcutter

Just out of interest, had you made them aware that you were in control of his finances before the first loan was paid out?

I'm not sure how much that will matter with the ombudsman, but if they knew that and still paid them out, that's horrendous.

Hope you manage to get this sorted. Does your son know that he had the money and what he used it for?

TheMoney

Where did the money go? It won't be as straightforward as it seems, your son took the loans, signed the agreement, and spent the money. On the other hand, financial institutions must lend responsibility, and conduct reasonable checks to ensure they are. It could go either way, but we need more info. When were they notified of your sons mental state? When was the legal letter that you have written? Why don't you have POA? What exactly is the legal document you hold? What exactly were the loans spent on? What was your sons mental state at the time of signing the agreements?

The_Famous_Cash

opinions4u wrote: »

Do you want the FOS to reach a different decision to the bank's own complaints process?

Yes, of course.

The_Famous_Cash

TheMoney wrote: »

Where did the money go? It won't be as straightforward as it seems, your son took the loans, signed the agreement, and spent the money. On the other hand, financial institutions must lend responsibility, and conduct reasonable checks to ensure they are. It could go either way, but we need more info. When were they notified of your sons mental state? When was the legal letter that you have written? Why don't you have POA? What exactly is the legal document you hold? What exactly were the loans spent on? What was your sons mental state at the time of signing the agreements?

I have no way of knowing what happened to the money. I suspect it went to third parties taking advantage but have no way of establishing.
They knew of my son's problems many years ago. They also deny knowledge of that but I proof since the document was produced (again) follwing another unrelated earlier complaint.
The document was written many years ago.
POA was not necessary since it is a legal document giving me full control over any of his financial transactions.
My son has many disabilities including learing difficulties since birth.

The_Famous_Cash

debtcutter wrote: »

Just out of interest, had you made them aware that you were in control of his finances before the first loan was paid out?

I'm not sure how much that will matter with the ombudsman, but if they knew that and still paid them out, that's horrendous.

Hope you manage to get this sorted. Does your son know that he had the money and what he used it for?

He only knows he owes the bank "a lot of money" and believes he is going to prison because he cannot afford to repay.

Apples2

The_Famous_Cash wrote: »

He only knows he owes the bank "a lot of money" and believes he is going to prison because he cannot afford to repay.

Reasure him he won't go to prison, unless he lives in Dubai

meer53

Why have you not set up a POA with his bank ?

PeacefulWaters

The_Famous_Cash wrote: »

Yes, of course.

Is it going to take you another eight months to reply to posts?