Unauthorised direct debit

denvore

Norscbu wrote: »

Is it possible someone you know might have your account details and took a chance on using them to pay off their own debts?

Personally, I'd push for more info on how the DD was originally set up. Your bank should have this info, i.e. was it organised online, did they receive a paper mandate etc. It's pretty hard to "guess" a valid account number and sortcode combination so I would remain sceptical about how they were obtained.

Likewise, I'd push for more info from the debt company, you should be able to obtain it via a formal request.

I'm reasonably confident that it is no one I know. This is an account that is not used for day to day stuff and the card/account details are not stored in wallet or used for many things.
The bank are already investigating and I'll give them a few more days before I contact them again (at this stage more out of curiosity than anything else). I don't think I'll call the debt company again - they didn't seem particularly interested or bothered.

YorkshireBoy

Norscbu wrote: »

Personally, I'd push for more info on how the DD was originally set up. Your bank should have this info, i.e. was it organised online, did they receive a paper mandate etc.

It's mandatory for all new service users to submit DDIs electronically via AUDDIS, and has been for some years now. Even when you complete a paper form, it resides with the originator only, and is not sent to the bank.

dunstonh

I must admit to losing a little bit of faith in the Direct Debit system. It seems that theoretically there is nothing stopping anyone paying for services and just making up an account number / sort code to set up payment. I might make the move back to standing orders. Does anyone know of a current account that does not accept or handle direct debits?

I thought your faith would be increased by how easy it was for you to tell the bank it was not your payment and how quick they refunded.

Account numbers are not sequential. So, you cant just change a 1 to a 2 and expect a) that account number to valid and b) for that account number to be in use at this time. It requires a lot more "bad luck"

I might make the move back to standing orders.

Standing orders which have less consumer protection. Once paid, you cant get the money back easily, if at all, if you gave the wrong account number or forgot to cancel it when it ended.

Plus, many companies will charge you a surcharge. for using standing orders.

Given your lack of monitoring your account, moving to standing orders increases the risks of errors. Not reduce it.

I'm just a bit flabbergasted on how easy direct debits could (in theory) be abused.

Abuse or clerical error?

Clerical errors happen but that does not make it abuse.
If an originator was abusing the system, they can have their ability to use the direct debit scheme taken away.

denvore

Thanks Dunstonh for your comments - it is the kind of logical thinking that I would like to think I would make under normal circumstances. However, I believe I am probably overreacting and letting my annoyance cloud my judgement.

You are probably correct in that this has resulted from a clerical error rather than any abuse or maliciousness. But I have discovered that UK account numbers do not include a checksum so (in theory at least) it could be possible to just make one up when setting up a direct debit and either: a) the recipient will complain when it doesn't get paid; or b) It gets paid and the system relies upon the account holder of the (coincidentally) valid account to report it.

From my experience I do have faith in the Direct Debit guarantee scheme (bank was very quick into action) but have a little less faith in the payment system as a whole. I'm just surprised this hasn't happened to me before.

JuicyJesus

denvore wrote: »

You are probably correct in that this has resulted from a clerical error rather than any abuse or maliciousness. But I have discovered that UK account numbers do not include a checksum so (in theory at least) it could be possible to just make one up when setting up a direct debit and either: a) the recipient will complain when it doesn't get paid; or b) It gets paid and the system relies upon the account holder of the (coincidentally) valid account to report it.

From my experience I do have faith in the Direct Debit guarantee scheme (bank was very quick into action) but have a little less faith in the payment system as a whole. I'm just surprised this hasn't happened to me before.

Some bank accounts do have a checksum, but it's down to the individual bank.

It hasn't happened before because the chance of fraud is dreadfully slim; you have to wait at the very least several days for it to bear fruit, during which time the fraud can be spotted relatively easily and the DDI cancelled. It will most likely never happen to the vast majority of people. You are just a bit unlucky!


For what it's worth, I accidentally made a typo when setting up a DD once; it's very easy to do but (had I not panicked and corrected it) would have been spotted as soon as I noticed that my phone bill hadn't come out of my account.

grumbler

dunstonh wrote: »

Account numbers are not sequential.

In fact, pretty often they are.

Account numbers are not sequential. So, you cant just change a 1 to a 2 and expect a) that account number to valid and b) for that account number to be in use at this time. It requires a lot more "bad luck"

Why a 1 to a 2 only, not to 3,4,5,6,7,8,9,0?

Plus, many companies will charge you a surcharge. for using standing orders.

Recipients? They may charge for paying by bank transfer in general, but not for SO in particular.

Abuse or clerical error?

Both.

If an originator was abusing the system, they can have their ability to use the direct debit scheme taken away.

Little consolation to people whose money was taken and who failed to spot this. Also, abuse can come from people paying for something by a DD.

JuicyJesus wrote: »

For what it's worth, I accidentally made a typo when setting up a DD once; it's very easy to do but (had I not panicked and corrected it) would have been spotted as soon as I noticed that my phone bill hadn't come out of my account.

Some people would be happy, not to mention those who make such 'typos' deliberately and especially those who use stolen ID for setting up credit accounts.

The DD system is flawed - fact. I am sure it will be changed at some point - a confirmation will be required from the bank account holder for setting up a new DD.

JuicyJesus

grumbler wrote: »

The DD system is flawed - fact. I am sure it will be changed at some point - a confirmation will be required from the bank account holder for setting up a new DD.

A consistently reliable system with a ridiculously low error/fraud rate doesn't seem that flawed to me.