How on earth has this been allowed to happen?

rigsby1967

My son (16) has a student account, the same as my 13 year old, with HSBC.
He got a letter to say he is over £15 in debit with them and has been charged interest.:eek:
They did say the accounts they both have CAN'T be overdrawn on as they are childrens account....if this is the case how come my son has gone overdrawn??
Thanks
rigs

tom188

Sometimes this can happen if someone makes cash withdrawals and/or a debit card transaction over a short period of time, before the balance has been updated to reflect the transaction. (Ie the bank would not allow the transaction if it was aware of it, but because it wasnt, it had no option but to pay the transaction when it came through.).

gt94sss2

rigsby1967 wrote: »

They did say the accounts they both have CAN'T be overdrawn on as they are childrens account....if this is the case how come my son has gone overdrawn??

What they may mean is that they don't allow these types of account to have overdrafts (unlike normal current accounts)

You could ask HSBC to see if they would waive the interest/charges but the reason for the account going overdrawn is probably as tom188 describes.. though his bank statement should show the reason..

Regards
Sunil

dunstonh

Sometimes a transaction comes in that cant help take the account a little overdrawn. In the past, doing a counter transaction then immediatly going to the cashpoint would allow this to occur (something that technology has mostly stopped happening nowadays but still possible if you know the right branch to do it from.

If I was you, I would suggest you use this as a lesson to your children and tell them the consequences of drawing money that is not theirs. Dont turn it into the bank being wrong because it is actually your child that is in the wrong. A little lesson now may teach them the value of money management.

Fizog

Same thing happened to my eldest son at 16 with the Abbey. he had withdrawn money from HSBC and they took four days to debit the account! So being drippy and 16 he assumed he had more money in the account took out another £20 and kerching overdrawn! He complained and they credited his account...now he has access to an online account being 17 and we don't have the problem.

dunstonh

So being drippy and 16 he assumed he had more money in the account took out another £20 and kerching overdrawn! He complained and they credited his account

To me that is so wrong. It sends out all the wrong signals. Spend what you dont have, dont look after you money but dont worry as you dont have to pay it back.

natweststaffmember

Rigsby, if the account has been taken overdrawn then the bank have technically given him an overdraft which falls under the Credit Consumer Act which states that only over 18 year olds can be given credit. If he has been charged interest the bank have to refund.
Another note i should say is that if anyone who works in a bank says that with a facility called solo that a person cannot go overdrawn then they have no idea what they are talking about. It is possible and it does happen.

Voyager2002

dunstonh wrote: »

To me that is so wrong. It sends out all the wrong signals. Spend what you dont have, dont look after you money but dont worry as you dont have to pay it back.

No, I am sure that all that was credited was a refund of any charges. And this experience offers a lot of positive lessons: there are serious consequences for behaving irresponsibly, but by being reasonable, apologising politely and taking action to put things right, you can avoid, at least once, many of those consequences. In this case I think everyone involved acted well, not least the bank.

Rafter

Overdrafts, like mortgages are not technically covered by the consumer credit act so any refund will be totally at the Banks discretion.

In theory systems like solo, electron and link should be 'real time' and prevent overdrafts on accounts without this facility.

However, in reality some retailers and cash machine networks batch items together and it can take a while for everything to update so the issue above can arrise. Very long delays though are unacceptable and the banks shouldn't be able to hind behind their own inefficiency as a justification for charges.

R.

s1h

I dont think it happens now but when i was young and stupid, i remember going to the shop buying some trainers and things on my electron card then going to the cashpoint and getting the money out putting me into a negative balance. Or even longer ago you could go into the branch take the money in your account out then go to the cashpoint outside and withdraw it.

And then I grew up;)

One other thing im not being funny but at 16 he knows whats in his account, he would have known there was more than there should be in there. He saw an oppurtunity and took it.

natweststaffmember

Rafter, i have to disagree with the views you have, I have never had a single problem getting a refund for a customer under the age of 18. The cannot be given an overdraft under the banking code until they are 18. In point of fact it was something I advised a kid to do on another charges website and they got all their charges back on that basis. Not 18 and therefore should not have been charged. If they fail to so, he needs to tell the bank he will take them to court for it. In contract law, it is unlawful to charge more than the cost of the item. End of.