Direct Debit Guarantee & cancelled service

Lrimas

Hi all,

I've recently had a request to have a direct debit returned under the direct debit guarantee rejected by my bank and was wondering if I should escalate.

I switched accountants (without contacting my original accountant as they were rubbish). I received an email from my original accountant to confirm that they have received my request to switch and have cancelled my account.

Because of this I assumed they would cancel my DD (well, that isn't entirely true. I completely forgot about the DD. This isn't normally something I have to worry about when I switch accounts though).

Anyway, they off course didn't cancel the direct debit. They are also not responding to any of my communications (part of the reason I switched). Bank says I'm not covered by DD guarantee as I didn't cancel the DD in time.

Should I escalate or just put this down to a mistake to learn from?

sheramber

The direct debit guarantee covers payments taken when not authorised,

As there was a current direct debit when the money was taken it was an authorised payment so not covered by the guarantee.

nyermen

Not sure I'm clear on this. Direct debit payments (collections) are requested by the receiver (different to a standing order where money is pushed by the sender).

This means the original accountant has "requested" money via Direct debit system (BACS etc), even though you note that they've confirmed your request to switch. Maybe because the AUDDIS (the bacs system) process had already happened for the billing period.

So - assuming you gave suitable notice under your contract etc, and so shouldn't have paid them, then surely the direct debit was unsolicited - regardless of whether a mandate is in place?

If this is correct, but the bank doesn't accept this explanation, then I guess a letter before action (LBA) to the old accountants?

mgdavid

nyermen wrote: »

.....
So - assuming you gave suitable notice under your contract etc,......

Never assume.
The OP already said she didn't bother to tell them....

whitepaper

Lrimas wrote: »

Hi all,

I've recently had a request to have a direct debit returned under the direct debit guarantee rejected by my bank and was wondering if I should escalate.

I switched accountants (without contacting my original accountant as they were rubbish). I received an email from my original accountant to confirm that they have received my request to switch and have cancelled my account.

Because of this I assumed they would cancel my DD (well, that isn't entirely true. I completely forgot about the DD. This isn't normally something I have to worry about when I switch accounts though).

Anyway, they off course didn't cancel the direct debit. They are also not responding to any of my communications (part of the reason I switched). Bank says I'm not covered by DD guarantee as I didn't cancel the DD in time.

Should I escalate or just put this down to a mistake to learn from?

There is no requirement within the Direct Debit Guarantee to have cancelled a mandate in order to recall an unauthorised payment.

Direct Debit Guarantee

• The Guarantee is offered by all banks and building societies that accept instructions to pay Direct Debits
• If there are any changes to the amount, date or frequency of your Direct Debit the organisation will notify you (normally 10 working days) in advance of your account being debited or as otherwise agreed. If you request the organisation to collect a payment, confirmation of the amount and date will be given to you at the time of the request
• If an error is made in the payment of your Direct Debit, by the organisation or your bank or building society, you are entitled to a full and immediate refund of the amount paid from your bank or building society
  • If you receive a refund you are not entitled to, you must pay it back when the organisation asks you to
• You can cancel a Direct Debit at any time by simply contacting your bank or building society. Written confirmation may be required. Please also notify the organisation.

So...

"If an error is made in the payment of your Direct Debit, by the organisation or your bank or building society, you are entitled to a full and immediate refund of the amount paid from your bank or building society"

The paying bank is obligated to accept the word of the payer, at least initially, as regards a claim.

But remember:

"If you receive a refund you are not entitled to, you must pay it back when the organisation asks you to"

Lrimas

mgdavid wrote: »

Never assume.
The OP already said he didn't bother to tell them....

That is true. I didn't inform them. Yet I did receive confirmation that my service was cancelled about 15 days before the DD was taken. If I hadn't I would have told them (or assumed the fault was with me as it could have been possible they were not aware).

Also never assume. Op is a she

jonesMUFCforever

How big a firm is the accountants?
I am wondering if it was not a direct debit at all but a standing order?

Lrimas

Thanks Nyermen & whitepaper. I'll escalate with Metro first to see what happens then go to BACS. I think I should make it clearer that the service was cancelled and therefore they made an error in taking the payment

jonesMUFCforever - it was definitely a DD. I have since cancelled it though.

mgdavid

Lrimas wrote: »

......
Also never assume. Op is a she

Apologies - amended