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My Dads Halifax and Bank of Scotland accounts closed for the free £5 ?
gettingthere28
Posts: 224 Forumite
My Dad has 3 Bank of Scotland Vantage accounts and 1 Halifax Account, he has had these for many a year. The 3 bank of Scotland ones are Vantage and he has the Maximum in them, the Halifax he has for the free £5 and has Two Direct Debits set up on it, in addition he has a Clydesdale bank account the Direct one that pays interest on £3k.
He Transfers once a month £1000 round them all.
Today he got a letter from both the Bank of Scotland and the Halifax (Although one was dated a day after the other), to say his accounts were being closed and he should make alternative banking arrangements outside of the LBG. The letter mentioned ‘Abuse of Banking Facilities”. He only uses the accounts for the interest there is no other transactions other than the £1000 transfer each month, and in the case of the Halifax the 2 Direct Debits.
He phoned the Bank of Scotland who would tell him nothing, he went into the Halifax branch were he has banked for years and was told that they see this all the time now, and although she never actually told him the reason (Possibly she could not) she said it’s all too common when customers have several accounts either in single or joint names and pass money through them for financial incentives !. I took that to mean passing £1000 through to get the interest or the free £5.
What worries me is I do the same, as probably so do many people but I think we could all perhaps be in for a shock, that said I think if the account was used as a normal current account you would be fine, in his case it was only one transaction a month, or 2 with the Halifax.
He Transfers once a month £1000 round them all.
Today he got a letter from both the Bank of Scotland and the Halifax (Although one was dated a day after the other), to say his accounts were being closed and he should make alternative banking arrangements outside of the LBG. The letter mentioned ‘Abuse of Banking Facilities”. He only uses the accounts for the interest there is no other transactions other than the £1000 transfer each month, and in the case of the Halifax the 2 Direct Debits.
He phoned the Bank of Scotland who would tell him nothing, he went into the Halifax branch were he has banked for years and was told that they see this all the time now, and although she never actually told him the reason (Possibly she could not) she said it’s all too common when customers have several accounts either in single or joint names and pass money through them for financial incentives !. I took that to mean passing £1000 through to get the interest or the free £5.
What worries me is I do the same, as probably so do many people but I think we could all perhaps be in for a shock, that said I think if the account was used as a normal current account you would be fine, in his case it was only one transaction a month, or 2 with the Halifax.
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gettingthere28 wrote: »My Dad has 3 Bank of Scotland Vantage accounts and 1 Halifax Account, he has had these for many a year. The 3 bank of Scotland ones are Vantage and he has the Maximum in them, the Halifax he has for the free £5 and has Two Direct Debits set up on it, in addition he has a Clydesdale bank account the Direct one that pays interest on £3k.
He Transfers once a month £1000 round them all.
Today he got a letter from both the Bank of Scotland and the Halifax (Although one was dated a day after the other), to say his accounts were being closed and he should make alternative banking arrangements outside of the LBG. The letter mentioned ‘Abuse of Banking Facilities”. He only uses the accounts for the interest there is no other transactions other than the £1000 transfer each month, and in the case of the Halifax the 2 Direct Debits.
He phoned the Bank of Scotland who would tell him nothing, he went into the Halifax branch were he has banked for years and was told that they see this all the time now, and although she never actually told him the reason (Possibly she could not) she said it’s all too common when customers have several accounts either in single or joint names and pass money through them for financial incentives !. I took that to mean passing £1000 through to get the interest or the free £5.
What worries me is I do the same, as probably so do many people but I think we could all perhaps be in for a shock, that said I think if the account was used as a normal current account you would be fine, in his case it was only one transaction a month, or 2 with the Halifax.
Same happened to me recently - again LBG.0 -
ED-1, You mentioned in previous forum that similar happened to one of your friend and if I remember correctly he got a CIFAS (misuse of account) Is that correct? Did he manage to remove it?
Abit worrying when they mention "Abuse of Banking Facilities".0 -
ED-1, You mentioned in previous forum that similar happened to one of your friend and if I remember correctly he got a CIFAS (misuse of account) Is that correct? Did he manage to remove it?
Abit worrying when they mention "Abuse of Banking Facilities".
Yes they were forced to remove it (at the start of this week in fact) by the Ombudsman as all he was doing was transferring his own money (albeit daily) between his own accounts. They offered £300 in compensation to him but luckily enough no other banks saw the marker in the meantime so no further damage done. They still closed his accounts though.
In my case I got a similar letter to the OP from Lloyds and Halifax - they even blocked my accounts to make sure I couldn't continue 'abusing the facilities' in the meantime. Funnily enough they didn't close the accounts when they said they would so I had to do it in branch!0 -
The bank has not given a definitive reason as to why the accounts have been closed, so speculating on the free £5 rewards and cycling funds to earn interest as being the cause is misleading at best.
I recall in your case Ed-1, it was because they did a credit check review and closed them on that basis?0 -
The bank has not given a definitive reason as to why the accounts have been closed, so speculating on the free £5 rewards and cycling funds to earn interest as being the cause is misleading at best.
I recall in your case Ed-1, it was because they did a credit check review and closed them on that basis?
To be honest I could only speculate as well as the bank just flat out refuse to give a reason for their decision (but looking into my credit file they made an unrecorded enquiry a day after I applied for a donor account, closed that account straight away, then made another unrecorded enquiry a few days later and decided to close the rest), just that they're closing them because they can and I no longer meet their criteria (the latter being the standard line closure department is drilled to say).0 -
The bank has not given a definitive reason as to why the accounts have been closed, so speculating on the free £5 rewards and cycling funds to earn interest as being the cause is misleading at best.
I recall in your case Ed-1, it was because they did a credit check review and closed them on that basis?
I think my clue was when she said "Its all too common when customers have several accounts either in single or joint names and pass money through them for financial incentives !."
I can't think of any other 'Financial Incentives' these accounts offer other than high interest and the free £5.0 -
OP - did you father applied for any additional account with LBG recently? Just thinking if that application caused remaining accounts to be closed.0
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OP - did you father applied for any additional account with LBG recently? Just thinking if that application caused remaining accounts to be closed.
No, the last account opened was in November 2013 which was the last Bank of Scotland account. No other accounts since then.
Never overdrawn, all three accounts at £5k and only 1 transaction a month which is the transfer in and out, which makes me think thats what it must be as there is simply nothing else happens on the accounts.0 -
gettingthere28 wrote: »No, the last account opened was in November 2013 which was the last Bank of Scotland account. No other accounts since then.
Never overdrawn, all three accounts at £5k and only 1 transaction a month which is the transfer in and out, which makes me think thats what it must be as there is simply nothing else happens on the accounts.
Who does it say the letters are from? Does it have a name at the bottom or a department in the top right (e.g. Account Closure Unit / Credit Decisioning)?
What is the precise wording?0 -
Who does it say the letters are from? Does it have a name at the bottom or a department in the top right (e.g. Account Closure Unit / Credit Decisioning)?
What is the precise wording?
From Account Closure Unit BX1 1LT, will try and upload a image of the letter and blank out any too personal details.0
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