Natwest: Default Due To Charges

Optikal

Okay, the story so far:

Recently I have been trying to rectify my credit history and upon checking my files was shocked to discover that I had a default on my file for an old Natwest Account I had stopped using in 2011.

I was certain that I left the account in with a few pounds worth of credit and transferred all of my outstanding payments to my new account. As it was just a basic account with no overdraft, paperless billing and was used almost exclusively online, I just left it as it was.

Checking the details I was shocked to find that the address was registered as in Leicester, when I have always lived in Leeds and the default was for a total of £795.56!

I called them immediately and Natwest told me that the address had been updated in November 2012. However, he also admitted that they had no record whatsoever that I had communicated in any way a change of address.

I had had Mail Forwarding for three months from my old address to my current one when I moved in November 2011 and know that I never received anything to say the account was overdue.

I also never updated the address further as I didn't use the account and it was just kind of forgotten about. The guy updated the address from Leicester for me.

He told me he couldn't say how the £795.56 had accrued but that he would order statements from their archive and post them to me.

I Received them Nov 2nd.

The following is a breakdown of the final transactions on this account:

15/09/2011 - Card Transaction - £2.70 - Balance: £2.44CR

03/10/2011 - Charges - Returned Item Fee - 6.00 - Balance: -3.56
02/11/2011 - Charges - Returned Item Fee - 42.00 - Balance:- 45.56
02/12/2011 - Charges - Unarranged OD Fee - 60.00 - Balance: -105.56
03/01/2012 - Charges - Unarranged OD Fee - 186.00 - Balance: -291.56
02/02/2012 - Charges - Unarranged OD Fee - 186.00 - Balance: -477.56
21/02/2012 - Charges - Unarranged OD Fee - 114.00 - Balance: -591.56
22/02/2012 - Charges - Default Notice Fee - 30.00 - Balance: -621.56
21/03/2012 - Charges - Unarranged OD Fee - 174 - Balance: -795.56

Now first of all, these charges seem incredibly high. Second of all, if not for the charges, the account would not have gone overdrawn and eventually into default. It feels ridiculous that for an initial spill-over of literally a few pounds, I should end up paying £795!

So I decided to place a complaint and sent them this letter:

Account: ******
Sort Code: *****

Dear Sir/Madam,

I am writing to lodge a dispute with regard to this account, which is currently in default. The total balance outstanding is currently £795.56, the entirety of which is made up of bank imposed charges, levied between the dates of 30/10/2011 and 21/03/2012.

On 30/10/11 I was charged a £6.00 Unpaid Item Fee and again on 02/11/11 a further £42 was levied. Prior to these charges, the account was in credit with a balance of £2.44. and has since not been used further by myself. The bank induced charges placed my account into a negative balance which you then began to charge a monthly ‘Unarranged OD Fee’ on from 02/12/11 until 21/03/12. These charges, along with a ‘Default Notice Fee’ of £30.00 amassed the total outstanding balance.

I would point out to you that under BCOBS you have a statutory duty to treat me fairly and have regard to my interests. It is clear that by deciding to pursue the course of action which you did, you acted completely against my interests and completely in your own interests, in order to maximise your opportunity to apply unfair charges against me, in order to maximise your revenue stream.

I object to these fees because it is your own charges which you have levied against me which have put me into overdraft. It is your charging scheme, it was designed by you, and it is intended to provide revenue for all parts of your personal account operation. Therefore your imposition of these charges on me can not be said to be ‘un-arranged’. You have imposed these charges upon me deliberately, in full knowledge of the state of my account and for your own purposes. It can never be said that the overdraft on my account was in any way unauthorised or un-arranged.

I need hardly point out to you that any reasonable person would regard treating unauthorised borrowing charges as themselves unauthorised as inherently unfair. Furthermore there is no contractual provision in your terms and conditions which allows you to treat your own charges as unauthorised borrowing. This means that there is an ambiguity in your terms and conditions which you have decided to interpret in your favour and against my interests. This is a violation of your statutory obligation under BCOBS, which require you to treat your customers fairly and to have regard to their interests. Clearly you have not done so here.

I would also like to bring to your attention the update of my registered address which took place in November 2012. My address was registered as ****. This fact was only brought to my attention whilst checking my ‘linked addresses’ on files provided by credit reference agencies. I have never has an association with Leicester, much less registered an address there. I telephoned your call centre and was assured by your operative that they had no record of any communication with me with regards this update and he subsequently changed the information.
However, due to you reporting this information to credit reference agencies as factually correct, I am now ‘linked’ to this address through my credit history. This constitutes a clear breach of the Data Protection Act with regards to data accuracy.

Both issues have had a negative impact on my credit history and will continue to do so for a period of six years from the date the default was registered. Once again, this is an unfair representation of myself as the registered default is entirely bank levied charges and further constitutes a violation of your statutory obligation under BCOBS.

In order to resolve this matter you must remove the outstanding charges from my account, remove the registered default from all credit reference agency reports and remove any registered address links to **** that you have previously reported. Failing this, I would invite you to take legal action against me to force me to pay. If a court determines that your charges are fair and the manner in which you have applied them is not a breach of your statutory obligations under BCOBS then I will of course, pay the outstanding in full.

I look forward to hearing from you presently.

Yours Faithfully
Op

Natwest agreed that the address change was wrong and out of order and have agreed to purge all of my credit files of this link. That's all well and good.

However, they have upheld that their charges are all in line and fair. They completed overlooked the fact that their returned item charge placed the account into overdraft and then they bean to charge monthly unauthorised overdraft charges on their previous charges month-on-month. They simply quoted back to me the terms and conditions that I signed:

6.31 Unarranged Overdraft Usage Fee

An Unarranged Overdraft Usage Fee will be charged for each day on which there is an unarranged overdraft of greater that £6 on your account at the close of business on that day. This is charged 21 days after the end of the charging period (or the next business day if this a saturday, sunday or bank holiday)

Unpaid Transaction Fee

An Unpaid Transaction Fee will be charged if: you informally request an unarranged overdraft by issuing instructions for a withdrawal or other payment ; and the payment cannot be met from the cleared balance in your account or any any unused overdraft; and we decide in our discretion not to make the payment. This is charged 21 days after the end of the charging period in which we decide not to make the payment (or the next business day if this is a saturday, sunday or bank holiday)

Then did the whole 'hope you are satisfied, if not talk to the FOS' spiel.

As far as I'm concerned, they did not even acknowledge anything in my letter regarding fairness or the fact that charging upon charges is unethical. I know that I should continue to fight this but I'm unsure how to further proceed?

Any help at all would be massively appreciated!

Thanks

[Deleted User]

You said in your letter that

"there is no contractual provision in your terms and conditions which allows you to treat your own charges as unauthorised borrowing."

In which case, I would point out that clause to them. But are you sure of your ground there - or is it more that the t&cs don't state either way? I wouldn't expect them to exclude charges from your balance when determining whether you are overdrawn or not.

Atidi

Optikal wrote: »

Okay, the story so far:

Recently I have been trying to rectify my credit history and upon checking my files was shocked to discover that I had a default on my file for an old Natwest Account I had stopped using in 2011.

I was certain that I left the account in with a few pounds worth of credit and transferred all of my outstanding payments to my new account. As it was just a basic account with no overdraft, paperless billing and was used almost exclusively online, I just left it as it was.

Checking the details I was shocked to find that the address was registered as in Leicester, when I have always lived in Leeds and the default was for a total of £795.56!

I called them immediately and Natwest told me that the address had been updated in November 2012. However, he also admitted that they had no record whatsoever that I had communicated in any way a change of address.

I had had Mail Forwarding for three months from my old address to my current one when I moved in November 2011 and know that I never received anything to say the account was overdue.

I also never updated the address further as I didn't use the account and it was just kind of forgotten about. The guy updated the address from Leicester for me.

He told me he couldn't say how the £795.56 had accrued but that he would order statements from their archive and post them to me.

I Received them Nov 2nd.

The following is a breakdown of the final transactions on this account:

15/09/2011 - Card Transaction - £2.70 - Balance: £2.44CR

03/10/2011 - Charges - Returned Item Fee - 6.00 - Balance: -3.56
02/11/2011 - Charges - Returned Item Fee - 42.00 - Balance:- 45.56
02/12/2011 - Charges - Unarranged OD Fee - 60.00 - Balance: -105.56
03/01/2012 - Charges - Unarranged OD Fee - 186.00 - Balance: -291.56
02/02/2012 - Charges - Unarranged OD Fee - 186.00 - Balance: -477.56
21/02/2012 - Charges - Unarranged OD Fee - 114.00 - Balance: -591.56
22/02/2012 - Charges - Default Notice Fee - 30.00 - Balance: -621.56
21/03/2012 - Charges - Unarranged OD Fee - 174 - Balance: -795.56

Now first of all, these charges seem incredibly high. Second of all, if not for the charges, the account would not have gone overdrawn and eventually into default. It feels ridiculous that for an initial spill-over of literally a few pounds, I should end up paying £795!

So I decided to place a complaint and sent them this letter:

Account: ******
Sort Code: *****

Dear Sir/Madam,

I am writing to lodge a dispute with regard to this account, which is currently in default. The total balance outstanding is currently £795.56, the entirety of which is made up of bank imposed charges, levied between the dates of 30/10/2011 and 21/03/2012.

On 30/10/11 I was charged a £6.00 Unpaid Item Fee and again on 02/11/11 a further £42 was levied. Prior to these charges, the account was in credit with a balance of £2.44. and has since not been used further by myself. The bank induced charges placed my account into a negative balance which you then began to charge a monthly ‘Unarranged OD Fee’ on from 02/12/11 until 21/03/12. These charges, along with a ‘Default Notice Fee’ of £30.00 amassed the total outstanding balance.

I would point out to you that under BCOBS you have a statutory duty to treat me fairly and have regard to my interests. It is clear that by deciding to pursue the course of action which you did, you acted completely against my interests and completely in your own interests, in order to maximise your opportunity to apply unfair charges against me, in order to maximise your revenue stream.

I object to these fees because it is your own charges which you have levied against me which have put me into overdraft. It is your charging scheme, it was designed by you, and it is intended to provide revenue for all parts of your personal account operation. Therefore your imposition of these charges on me can not be said to be ‘un-arranged’. You have imposed these charges upon me deliberately, in full knowledge of the state of my account and for your own purposes. It can never be said that the overdraft on my account was in any way unauthorised or un-arranged.

I need hardly point out to you that any reasonable person would regard treating unauthorised borrowing charges as themselves unauthorised as inherently unfair. Furthermore there is no contractual provision in your terms and conditions which allows you to treat your own charges as unauthorised borrowing. This means that there is an ambiguity in your terms and conditions which you have decided to interpret in your favour and against my interests. This is a violation of your statutory obligation under BCOBS, which require you to treat your customers fairly and to have regard to their interests. Clearly you have not done so here.

I would also like to bring to your attention the update of my registered address which took place in November 2012. My address was registered as ****. This fact was only brought to my attention whilst checking my ‘linked addresses’ on files provided by credit reference agencies. I have never has an association with Leicester, much less registered an address there. I telephoned your call centre and was assured by your operative that they had no record of any communication with me with regards this update and he subsequently changed the information.
However, due to you reporting this information to credit reference agencies as factually correct, I am now ‘linked’ to this address through my credit history. This constitutes a clear breach of the Data Protection Act with regards to data accuracy.

Both issues have had a negative impact on my credit history and will continue to do so for a period of six years from the date the default was registered. Once again, this is an unfair representation of myself as the registered default is entirely bank levied charges and further constitutes a violation of your statutory obligation under BCOBS.

In order to resolve this matter you must remove the outstanding charges from my account, remove the registered default from all credit reference agency reports and remove any registered address links to **** that you have previously reported. Failing this, I would invite you to take legal action against me to force me to pay. If a court determines that your charges are fair and the manner in which you have applied them is not a breach of your statutory obligations under BCOBS then I will of course, pay the outstanding in full.

I look forward to hearing from you presently.

Yours Faithfully
Op

Natwest agreed that the address change was wrong and out of order and have agreed to purge all of my credit files of this link. That's all well and good.

However, they have upheld that their charges are all in line and fair. They completed overlooked the fact that their returned item charge placed the account into overdraft and then they bean to charge monthly unauthorised overdraft charges on their previous charges month-on-month. They simply quoted back to me the terms and conditions that I signed:

6.31 Unarranged Overdraft Usage Fee

An Unarranged Overdraft Usage Fee will be charged for each day on which there is an unarranged overdraft of greater that £6 on your account at the close of business on that day. This is charged 21 days after the end of the charging period (or the next business day if this a saturday, sunday or bank holiday)

Unpaid Transaction Fee

An Unpaid Transaction Fee will be charged if: you informally request an unarranged overdraft by issuing instructions for a withdrawal or other payment ; and the payment cannot be met from the cleared balance in your account or any any unused overdraft; and we decide in our discretion not to make the payment. This is charged 21 days after the end of the charging period in which we decide not to make the payment (or the next business day if this is a saturday, sunday or bank holiday)

Then did the whole 'hope you are satisfied, if not talk to the FOS' spiel.

As far as I'm concerned, they did not even acknowledge anything in my letter regarding fairness or the fact that charging upon charges is unethical. I know that I should continue to fight this but I'm unsure how to further proceed?

Any help at all would be massively appreciated!

Thanks

Well cutting directly to your question over fairness and the fact you know you should fight this, then presumably you know how to do that?

If not, this MSE article explains all,
http://www.moneysavingexpert.com/reclaim/bank-charges

You probably need the extra article linked to in that article about making a complaint in court.

Good Luck!

(I think you'll probably need all the luck you can muster as not only have the Supreme Court given their ruling years ago, but even multi-millionaire, Dr Lewis now admits that despite paying a small fortume for some of the best legal advice in the land on attempting to recover bank fees in such instances, there is now a disclaimer on that article saying no one has ever reported any success following that advice in all the years it had been posted.)

Still, you have to admire a trier!

Optikal

Deleted_User wrote: »

You said in your letter that

"there is no contractual provision in your terms and conditions which allows you to treat your own charges as unauthorised borrowing."

In which case, I would point out that clause to them. But are you sure of your ground there - or is it more that the t&cs don't state either way? I wouldn't expect them to exclude charges from your balance when determining whether you are overdrawn or not.

Pretty certain, though I'll go over it once again and press on the 'ambiguity' line.

Atidi wrote: »

Well cutting directly to your question over fairness and the fact you know you should fight this, then presumably you know how to do that?

If not, this MSE article explains all,
http://www.moneysavingexpert.com/reclaim/bank-charges

You probably need the extra article linked to in that article about making a complaint in court.

Good Luck!

(I think you'll probably need all the luck you can muster as not only have the Supreme Court given their ruling years ago, but even multi-millionaire, Dr Lewis now admits that despite paying a small fortume for some of the best legal advice in the land on attempting to recover bank fees in such instances, there is now a disclaimer on that article saying no one has ever reported any success following that advice in all the years it had been posted.)

Still, you have to admire a trier!

Yeah, I know how to press forward I think, I'm just looking for more neutral opinions. I reckon I'll have to follow it up with FOS and see what happens...

Atidi

Optikal wrote: »

... I reckon I'll have to follow it up with FOS and see what happens...

I could tell you what will happen if you complain to the FOS about the unfairness of the bank charges you incurred, but I'd hate to spoil the surprise





***SPOILER ALERT***
Click here if you really can't stand the suspense.
http://www.financial-ombudsman.org.uk/faq/bank-charges.html

Optikal

I'm looking at this now and within their T&Cs it states:

6.5.2: We may debit your account with any arranged overdraft interest, fees, charges or other costs, even if this results in or increases an unarranged overdraft. If an unarranged overdraft arises in this way we may apply an Unarranged Overdraft Usage Fee

Does this cover charging for previous charges do you think?

Optikal

Just got home to find a letter from the same case saying that Natwest Credit management Service had written off the debt. Doubt I'll be able to get the default removed from my credit file to be honest!