RBS Credit Card PPI increased debt over 16 years!

gossfam1

Yes indeed..I kind of feel like I'm on trial already and I was only asking if others had seen this kind of increasing debt because of a PPI policy before...

takman

gossfam1 wrote: »

Yes indeed..I kind of feel like I'm on trial already and I was only asking if others had seen this kind of increasing debt because of a PPI policy before...

The debt increased because your wife "buried her head in the sand" and simply paid the minimum payment without even checking the account. She didn't even update her address so that she would receive the statements so she never even tried to look at them.

You seem to acknowledge that your wife has handled this account extremely poorly but you still seem to be determined to somehow find the bank at fault.

gossfam1 wrote: »

Whilst this is true..I would argue that if you viewed a statement with "interest charged" and "PPI charged" would you really question was this was for in 2003/4/5 ? What if you had no idea what it was and just assumed you had to pay it as it was on the statement as a charge?

I would argue you are now viewing this in 2018 as something you could reject or opt out of, where as in 2002-05 you would assume it was just part of the charge of having the card or using the credit facility.

I completely disagree with this statement, ever since bank accounts have been around people have checked their statements to make sure all transactions were correct.

I really can't believe you think it was common for people to check their statements and then ignore everything that they didn't know what was it for and assume it was correct, that is ridiculous and completely defeats the purpose of checking them in the first place!.

gossfam1

takman wrote: »

The debt increased because your wife "buried her head in the sand" and simply paid the minimum payment without even checking the account. She didn't even update her address so that she would receive the statements so she never even tried to look at them.


You seem to acknowledge that your wife has handled this account extremely poorly but you still seem to be determined to somehow find the bank at fault.

I do acknowledge that she has been negligent - However banks also have a duty of care to ensure if they are lending money and are fixing repayments - remember this was a bank derived D/D that the repayment they are taking will cover the debt to be repaid. They cannot reasonably expect a customer to calculate their own repayment, irrespective of the fact it could be interpolated from the statements that the debt was increasing. Remember you would only be able to pick up this pattern from viewing a series a statements, not from an isolated single statement.

takman wrote: »

I completely disagree with this statement, ever since bank accounts have been around people have checked their statements to make sure all transactions were correct.

You are assuming everyone is a competent MSE - Banks have a duty of care not to take advantage of their customers because they choose to ignore statements, however unwise that is in hindsight!

takman wrote: »

I really can't believe you think it was common for people to check their statements and then ignore everything that they didn't know what was it for and assume it was correct, that is ridiculous and completely defeats the purpose of checking them in the first place!.

Yet this is the same logic that caught me - someone who I consider to be reasonable wise in money matters. For 9 months an amount was on my statement for a £9.99 for which I did nothing about. This I was later to find out was a packaged bank account. I questioned it with the bank and they refunded it, as I never asked for it. I had a friend that was paying £5 per month for an AOL subscription for 5 years after she moved out of the property. I think it happens more than you think that people 'assume' what's on their statements must be correct..

takman

gossfam1 wrote: »

I do acknowledge that she has been negligent - However banks also have a duty of care to ensure if they are lending money and are fixing repayments - remember this was a bank derived D/D that the repayment they are taking will cover the debt to be repaid. They cannot reasonably expect a customer to calculate their own repayment, irrespective of the fact it could be interpolated from the statements that the debt was increasing. Remember you would only be able to pick up this pattern from viewing a series a statements, not from an isolated single statement.

The minimum repayment amount is the least they will accept from someone. It's pretty clear from the name that this isn't any kind of recommended amount.

When you have a credit card you are expected to choose how much you pay per month. This is why you get monthly statements so you can choose to adjust the payments depending on how fast you want to pay the debt off/ how much interest you want to pay. By not checking her statements since 2006? she has no comeback whatsoever for the balance not decreasing as she "assumed".

Also when this card was taken out there was nothing to say the minimum payment must reduce the balance each month. This wasn't necessarily wrong because a credit card isn't primarily designed to be used for a couple of purchases and then slowly paid off over a long period of time.
The only reason the minimum payments have increased these days is because people have shown they can't menage their fiances properly and get in unmanageable debt.

gossfam1 wrote: »

You are assuming everyone is a competent MSE - Banks have a duty of care not to take advantage of their customers because they choose to ignore statements, however unwise that is in hindsight!

You don't need hindsight to realise that not checking a statement for 10+ years is a bad idea.

You even said that these statements have been going to an old address for this entire time which also means any replacement cards and pins would also go to this address. So there was a risk of the card being fraudulently used by a third party without your wife knowing. This could have gone on for some time and she could have been paying off someone eases purchases for an extended period all the while "assuming" that the increased minimum payments were correct.

gossfam1 wrote: »

Yet this is the same logic that caught me - someone who I consider to be reasonable wise in money matters. For 9 months an amount was on my statement for a £9.99 for which I did nothing about. This I was later to find out was a packaged bank account. I questioned it with the bank and they refunded it, as I never asked for it. I had a friend that was paying £5 per month for an AOL subscription for 5 years after she moved out of the property. I think it happens more than you think that people 'assume' what's on their statements must be correct..

Two good examples of why you need to check every payment on your bank statements, which is quick and easy with online banking.

You right that the bank can't take advantage of customers but customers should also make sure they understand any agreements before they sign them.

I think the most useful thing i can say to you is go and check every payment you have coming out of you and your wife's accounts for the last 6 months. Check every single credit account you have to make sure you are paying it off the best you can (pay off her credit card in full right now if you haven't already done so). Create a budget to work out your incoming and outgoings and reduce where you can (no matter how rich you are). Do a complete check of everything and i bet you can save a good amount of money.
At the end of the day your wife got off lucky because she didn't have any missed payments/defaults , fraud or other charges. So take this as lesson to really get a grip of both your fiancees instead of finding ways to blame the bank.

Placida

gossfam1 wrote: »

Hello all,

After running a check report for my wife and I before we applied for a new mortgage, I have discovered a credit card she had some knowledge of, but buried her head in the sand about - cue long 'discussions'!

This is a card that was taken out in 2002, spent on and then stopped using about 18months later. The minimum payment was always taken each month from here bank account.
However the card came with PPI, which she didn’t realise at the time and certainly had no idea about more recently. From what I have established so far, the PPI premium was added to the card balance each month, but the minimum payment was not sufficient to pay of the interest along with the PPI, so each month the card balance was increasing. My wife mistakenly thought that so long as the minimum payment was made each month the card would eventually be paid off.
The credit report shows the balance of £1000 in 2012 in increasing to £1200 in June 2018, despite payment of £26 ish per month being paid.

If the PPI had not be added to the balance each month and the minimum repayments of 2.25% made, the card would be nearing full repayment now.

So my question is, there is clearly a case of PPI mis-selling here, as my wife was clear she never asked for PPI, nor even knew she had it. But is there also a case for RBS to answer why they didn’t increase her monthly payments to cover the PPI, as it’s surely not ethical for the bank not to ensure the minimum repayment will eventually pay off the debt. If I had not discovered this now, the debt would have never been repaid and be forever increasing, unbeknown to my wife who was merely meeting her minimum repayments and assumed so long as she didn’t ‘spend’ any more on the card, the monthly repayments would eventually clear the card balance.

Any thoughts, is this common, have others also had this happen to them?
Many thanks,
A

You might find these links useful.

http://www.ombudsman-decisions.org.uk/viewPDF.aspx?FileID=47105

“Ms B complains about the sale of a monthly premium payment protection insurance (PPI) policy sold in connection with a credit card account in 2003. Ms B believes The Royal Bank of Scotland Plc (RBS) mis-sold her the policy. The core of Ms B’s complaint is that she was not aware the policy was optional......

I have also taken into account that reference is made to ‘cardholder protection plan’ and ‘payment protection’ on three monthly credit card statements I have been provided with. However, I am not persuaded that, even if Ms B was in the habit of reading her monthly bank statements, this ought to have alerted her that PPI was optional. I acknowledge that the PPI premiums appeared on Ms B’s credit card for a number of years as separate transactions. However, in my view, all this shows is that she was paying a separate amount for the insurance each month to RBS – it does not, in my view, illustrate that the policy was presented as optional. Furthermore, the lack of challenge until 2012 is consistent with Ms B’s testimony that she believed that the policy was part of the credit card package and not an optional product.”

Also
http://www.financial-ombudsman.org.uk/publications/technical_notes/ppi/redress.html#redresscc
how does the ombudsman approach redress where a PPI policy has been mis-sold?

Scroll down to
“consumers who consistently make the minimum payment each month”

“Based on examples of good practice we have seen, the example below shows how a business might set out how it has calculated compensation for a mis-sold regular-premium PPI policy added to a consumer’s credit card where the consumer consistently paid the minimum contractual payment:”

Nasqueron

Placida wrote: »

You might find these links useful.

http://www.ombudsman-decisions.org.uk/viewPDF.aspx?FileID=47105

“Ms B complains about the sale of a monthly premium payment protection insurance (PPI) policy sold in connection with a credit card account in 2003. Ms B believes The Royal Bank of Scotland Plc (RBS) mis-sold her the policy. The core of Ms B’s complaint is that she was not aware the policy was optional......

I have also taken into account that reference is made to ‘cardholder protection plan’ and ‘payment protection’ on three monthly credit card statements I have been provided with. However, I am not persuaded that, even if Ms B was in the habit of reading her monthly bank statements, this ought to have alerted her that PPI was optional. I acknowledge that the PPI premiums appeared on Ms B’s credit card for a number of years as separate transactions. However, in my view, all this shows is that she was paying a separate amount for the insurance each month to RBS – it does not, in my view, illustrate that the policy was presented as optional. Furthermore, the lack of challenge until 2012 is consistent with Ms B’s testimony that she believed that the policy was part of the credit card package and not an optional product.”

Also
http://www.financial-ombudsman.org.uk/publications/technical_notes/ppi/redress.html#redresscc
how does the ombudsman approach redress where a PPI policy has been mis-sold?

Scroll down to
“consumers who consistently make the minimum payment each month”

“Based on examples of good practice we have seen, the example below shows how a business might set out how it has calculated compensation for a mis-sold regular-premium PPI policy added to a consumer’s credit card where the consumer consistently paid the minimum contractual payment:”

OP isn't claiming hey didn't know it was optional, they were saying their partner didn't know about it which statements clearly prove she did

gossfam1

Placida wrote: »

You might find these links useful.

http://www.ombudsman-decisions.org.uk/viewPDF.aspx?FileID=47105

“Ms B complains about the sale of a monthly premium payment protection insurance (PPI) policy sold in connection with a credit card account in 2003. Ms B believes The Royal Bank of Scotland Plc (RBS) mis-sold her the policy. The core of Ms B’s complaint is that she was not aware the policy was optional......

I have also taken into account that reference is made to ‘cardholder protection plan’ and ‘payment protection’ on three monthly credit card statements I have been provided with. However, I am not persuaded that, even if Ms B was in the habit of reading her monthly bank statements, this ought to have alerted her that PPI was optional. I acknowledge that the PPI premiums appeared on Ms B’s credit card for a number of years as separate transactions. However, in my view, all this shows is that she was paying a separate amount for the insurance each month to RBS – it does not, in my view, illustrate that the policy was presented as optional. Furthermore, the lack of challenge until 2012 is consistent with Ms B’s testimony that she believed that the policy was part of the credit card package and not an optional product.”

Also
http://www.financial-ombudsman.org.uk/publications/technical_notes/ppi/redress.html#redresscc
how does the ombudsman approach redress where a PPI policy has been mis-sold?

Scroll down to
“consumers who consistently make the minimum payment each month”

“Based on examples of good practice we have seen, the example below shows how a business might set out how it has calculated compensation for a mis-sold regular-premium PPI policy added to a consumer’s credit card where the consumer consistently paid the minimum contractual payment:”

Thank you, this is the most helpful post of all

dunstonh

Thank you, this is the most helpful post of all

Although it doesnt seem to match the scenario mentioned in post #1.

This is someone who took it out saying they believed it to be compulsory. The thread is about someone who claims they didn't know they had it.

Those that say it was compulsory have just as many rejections as upholds at the FOS. So, relying on one decision is not a good idea. For example, here is the same allegation but a rejection and it a closer scenario to the one on this thread.


http://www.ombudsman-decisions.org.uk/viewPDF.aspx?FileID=32262

...complains he was not aware he had taken out a PPI policy and later believed it was compulsory...
...It seems to me that the relevant considerations in this case are materially the same as those set out in the PPI section in our website...
...In saying this I have noted that the credit card application does not state anywhere that the PPI is compulsory or mandatory...
...Having considered the evidence, I am persuaded that Mr B chose to have PPI added to his account and that he was most likely aware of the optional nature of the PPI policy. I have seen no evidence that persuades me that RBS indicated or inferred that the PPI policy was compulsory.
...I am also mindful of the fact that Mr B could have cancelled the PPI policy at any time since 2004 !!!8211; the PPI premiums are clearly identifiable on his monthly credit card statements. If PPI was something that Mr B did not want or feel the need for, I would have expected him to have cancelled it.
...For the reasons set out above, I do not uphold this complaint and make no award against The Royal Bank of Scotland plc.

--

gossfam1

dunstonh wrote: »

Although it doesnt seem to match the scenario mentioned in post #1.

This is someone who took it out saying they believed it to be compulsory. The thread is about someone who claims they didn't know they had it.
--

You appear to know the extent of my wife's knowledge more than she does!


When you require a credit card and someone tells you should/need/must have this or that to obtain the card, you say okay then, because it's the card and the line of credit that is required. This is why many people ended up with the product.



To me the mis-selling scandal is because millions of people are paying for an expensive product they do not understand or never knew they had and several people on this forum sound like they have more sympathy with the banks than they do with vulnerable customers.



She had no idea she had agreed to PPI when the application was made and until I can obtain a copy of the original credit agreement I can't say how she consented to PPI. For all we know, she may have ticked a box or not unticked a box - It could be that simple. She certainty no idea what this product when she took out the card 16 years ago and had no idea she was continuing to pay for the product for 16 years until 48 hours ago.


Whilst I do appreciate the advice on how best to structure my argument for reclaim, and do understand the exact nature of my complaint will affect how the claim is viewed, please do not forget there are many vulnerable customers, who do have poor judgement, who do ignore their statements, who do pay stupid interest rates when they have plenty of savings in the bank and indeed pay for things listed on a statement they do not understand. We all make stupid decisions at times and unfortunately this one has lain undiscovered for 16 years and been very costly.



I have calculated that the original debt of £1,000 would have been paid back in 2010 at the rate of repayment. Because of PPI being added – a product supposedly designed to “protect the customer”, the debt was continually being added to. Whether I can prove bad practice on behalf of the bank may very well be an uphill struggle, but clearly this product has done exactly the opposite of ‘help’

dunstonh

You appear to know the extent of my wife's knowledge more than she does!

We only go on what you tell us here.

When you require a credit card and someone tells you should/need/must have this or that to obtain the card, you say okay then, because it's the card and the line of credit that is required. This is why many people ended up with the product.

And what evidence do you have to support that allegation?

It is an allegation being made by you or your wife of a verbal conversation that took place 16 years ago that almost certainly has no evidence to back it up.

Whilst the FOS do not require physical evidence when making a complaint, they do look at the available evidence. This will include a copy of the application form. They then consider the credibility of both sides along with what evidence does exist. Verbal conversations of 16 years previous carry little weight.

To me the mis-selling scandal is because millions of people are paying for an expensive product they do not understand or never knew they had and several people on this forum sound like they have more sympathy with the banks than they do with vulnerable customers.

Your emotional attachment to this issue is not something others have. We can see the pros and cons and are just highlighting them accordingly. Indeed, several of the responders you allege have more sympathy with the banks have themselves had complaints about PPI missales.

She had no idea she had agreed to PPI when the application was made and until I can obtain a copy of the original credit agreement I can't say how she consented to PPI.

It should be noted that the credit agreement may not show whether PPI was bought or not when it comes to credit cards. Some types do but not all. Loans are required to show it. Other types are not.

Nobody is saying you should not make the complaint. However, as it stands, the complaint reason you are relying on (didn't know she had it) is one of the weakest complaint reasons possible. Hence the earlier comments suggesting you try and tighten up the complaint reason with one of the more likely to succeed complaint reasons (such as eligibility or suitability - areas that see far higher success rates on complaints). You may get lucky. The bank may decide the amount is small and auto-payout. They may find a failing you dont even know about and didnt raise and uphold on that basis. However, if the only issue is a verbal conversation alleged to have taken place 16 years ago (and your posts are contradictory as you also say you dont know how she consented until you get a copy) then the odds of success are lower.