Bank Mistake

Goldiegirl

I think this case illustrates why people find dealing with banks so frustrating.

The error probably originated when the cheque was paid in, and was encoded as £1900, instead of £1800. One has to assume that £1900 was paid into the payees account, otherwise the cashier wouldn't have been able to balance their till.

Of course, none of this matters to the person who wrote the cheque. An error has been made, and Lloyds have confirmed that the cheque has been processed incorrectly, so they need to put it right.

It's a very easy matter to correct this. Just debit the appropriate sundries account and credit the customer. Job done for the customer.

Of course behind the scenes Lloyds will need to decide whether to try to reclaim the money from the payee or whether to write it off. But this doesn't affect Mrs W, all she wants is the matter to be corrected.

The problem is, people in branches are really just sales people, and that includes the manager. Years ago, people who worked in branches were trained in how banking works, so they'd know what to do when corrections needed to be done. Likewise, with the call handlers - they know very little of the mechanics of banking.

All the people in the branches with this knowledge are now gone - either retired or made redundant.

So when this situation arises the poor customer is passed from pillar to post.

As previously suggested, Mrs W now needs to write a formal letter of complaint. The complaint handler may not know how to refund the £100.... But as their job involves resolving complaints, they'll need to find the correct department somewhere in head office to refund the £100.

With regard to an ex-gratia payment. I feel a reasonable complaint handler would offer around £25 for the inconvenience, without any prompting.

If Mrs W wishes to raise the issue, I'd suggest asking for a goodwill payment to reflect the inconvenience caused. This will get her further than 'demanding compensation' as was suggested in an early post.

Another post suggested refusing compensation and going to the FOS. Personally I'd accept any offer and move on with my life - surely it's better to put it behind you rather than have to fester about it for longer.

YorkshireBoy

Goldiegirl wrote: »

Another post suggested refusing compensation and going to the FOS. Personally I'd accept any offer and move on with my life - surely it's better to put it behind you rather than have to fester about it for longer.

I suggested that as it would force two things upon Lloyds:

Firstly, they'd be asked to tighten up their procedures to reduce the chance of it happening again. And if several customers are reporting the same thing it'll be embarrassing for Lloyds and may shame them into making the necessary improvements faster and more robust.

Secondly, the FOS take a very dim view of banks fobbing off customers (lots of case files on their website, particularly with regard to misinformation around section 75), and that is very much what has happened here. This in itself will provide for an enhanced award (not that that's the main reason), and also serve to embarrass Lloyds further.

All banks will make mistakes, as I've experienced myself. However, the measure of a good bank is what they do to put things right. And Lloyds have failed miserably here in this regard. Had they immediately refunded £100 (as is their duty under the aforementioned PSRs), then I'm sure the OP's hubby would have said thanks and moved on with their life.

Agree 100% with the rest of your post though.

callum9999

YorkshireBoy wrote: »

I suggested that as it would force two things upon Lloyds:

Firstly, they'd be asked to tighten up their procedures to reduce the chance of it happening again. And if several customers are reporting the same thing it'll be embarrassing for Lloyds and may shame them into making the necessary improvements faster and more robust.

Secondly, the FOS take a very dim view of banks fobbing off customers (lots of case files on their website, particularly with regard to misinformation around section 75), and that is very much what has happened here. This in itself will provide for an enhanced award (not that that's the main reason), and also serve to embarrass Lloyds further.

All banks will make mistakes, as I've experienced myself. However, the measure of a good bank is what they do to put things right. And Lloyds have failed miserably here in this regard. Had they immediately refunded £100 (as is their duty under the aforementioned PSRs), then I'm sure the OP's hubby would have said thanks and moved on with their life.

Agree 100% with the rest of your post though.

I think your embarrassment claims are a bit over the top, it's a bank not a person, and no normal person is going to be particularly embarrassed over a small thing like this.

The only reason to go to the regulator is if you want more money or if the bank refuses to refund.

YorkshireBoy

callum9999 wrote: »

I think your embarrassment claims are a bit over the top, it's a bank not a person, and no normal person is going to be particularly embarrassed over a small thing like this.

I'm obviously talking about corporate embarrassment. If this is happening a lot, then systems (both prevention and remedy) need to improve.

The only reason to go to the regulator is if you want more money or if the bank refuses to refund.

I didn't mention going to the regulator (which would be FCA, and to a lesser degree here, the PRA). I said go to the FOS. Indeed, the FOS themselves say "we don't write the rules for financial businesses – or fine them if rules are broken. That’s the regulator’s job."

Armorica

apart from cheques aren't covered under the PSRs...

It should be a trivial matter for Lloyds to sort out. Just write and tell them that you plan to take to the ombudsman as the next stage - they should promptly get their act together. (PRA/FCA wouldn't deal with individual cases, FOS is the proper route)

The improving procedures thing is a red herring too. Cheques are handwritten instructions. Mistakes just happen. It's pretty impossible to remove all of them, but minimising them is what already happens.

Given the way that cheques are processed, the same error may not have affected the tradesman - he may have just got the 1800. (But if Lloyds to Lloyds, more likely he got 1900)

Ballard

Armorica wrote: »

Given the way that cheques are processed, the same error may not have affected the tradesman - he may have just got the 1800. (But if Lloyds to Lloyds, more likely he got 1900)

I would be surprised (although not amazed) if the payee didn't get £1,900. I've Googled 'unpaid cheque' and the first result is attached. The 300 on the right hand side at the bottom is £3.00 and it's this figure that drives the entries.

Thrugelmir

YorkshireBoy wrote: »

I'm obviously talking about corporate embarrassment. If this is happening a lot, then systems (both prevention and remedy) need to improve.

People make mistakes. I never known anybody that's perfect. Though many people seem to think that they've halos above their heads.

Best to keep matters in context and perspective.

gettingthere28

Ballard wrote: »

I would be surprised (although not amazed) if the payee didn't get £1,900. I've Googled 'unpaid cheque' and the first result is attached. The 300 on the right hand side at the bottom is £3.00 and it's this figure that drives the entries.

Yes I remember that cheque, that was our ex-chancellor Gordon Brown MP, bounced a cheque for £3 for his student rent !.

paddyrg

Is it worth going to your branch and just sitting with the manager until he/she has got through to someone on the phone and sorted out? Being in the way keeps you present in peoples minds

Armorica

It's not worth getting into a very technical discussion about the differences between in-clearing and out-clearing, and branch vs. clearing centre processing, and which banks rely on which part of that process (and whether paper vs. data).

Broadly, if it's all within Lloyds - the error is likely to be all the way through to both customer accounts. If it involves another bank, it's entirely possible the error is on one side only and the difference in funds is on a suspense account somewhere.