LLoyds shredding business cheques instead of banking them

OopNorfJonny

On Monday I banked 2 cheques with Lloyds for 2 1/2 grand, but instead of clearing them they have shredded them and told me I must get new ones.

This will be a real pain with a small chance that my payers do not replace them.I'm self employed and have a trading name as well as my personal name. Lloyds will not allow me to put cheques made to the trading name and made me open a Business Account specifically to accept cheques in my trading name. I have done this for 10 years until this week, they shredded my 2 cheques because they say their computer says my trading name is "wrong". Their records have my business name as trading name plus a 2 word description of business activities ( a bit like "JoesCars Taxi Services" where JoesCars is the Trading name. Im not JoesCars but you get the idea, its a fairly standard way of having a trading name. ).

The trigger for this nightmare was, at the direction of their staff, I used their paying in machine. These scan the cheques and apparently, now the name on the cheque must match their record of the business name, letter for letter. If it does not, the cheque is "destroyed". There is no plan B or way to correct this, nor will they return the cheque as they say its "their property". You can change the business name but they will not apply this to the destroyed cheques, only for future banking. In the example I made up above this would mean that cheques made to JoesCars would be rejected and destroyed to be replaced by new cheques to "JoesCars Taxi Services".

Obviously I am very very unhappy as the account was specifically opened to take cheques in my trading name just like these two and has been operating for 10 years without a problem with every single cheque banked for 10 years being exactly the same as the two destroyed cheques.

The moral of the story is don't use Lloyds new paying in machine or even better don't use Lloyds. I have switched all my accounts to other banks.

jonesMUFCforever

You do or will get a letter with a copy of the cheques to prove that the cheques have been destroyed. The only solution I can offer is that in future you use a human cashier and refuse to use the deposit machine.

That was quick though wasn't it - paid in yesterday and by today you have switched accounts - I call that a miracle!

Ben8282

It surprises me that anybody actually bothered to check the payee name at all.
It surprises me even more that they should have been refused on the basis that you state.
I simply cannot believe that they then shredded the cheques.

18cc

I think you should definitely submit a complaint to Lloyds and when you get a Deadlock letter go to the regulator

Takmon

OopNorfJonny wrote: »

On Monday I banked 2 cheques with Lloyds for 2 1/2 grand, but instead of clearing them they have shredded them and told me I must get new ones.

This will be a real pain with a small chance that my payers do not replace them.I'm self employed and have a trading name as well as my personal name. Lloyds will not allow me to put cheques made to the trading name and made me open a Business Account specifically to accept cheques in my trading name. I have done this for 10 years until this week, they shredded my 2 cheques because they say their computer says my trading name is "wrong". Their records have my business name as trading name plus a 2 word description of business activities ( a bit like "JoesCars Taxi Services" where JoesCars is the Trading name. Im not JoesCars but you get the idea, its a fairly standard way of having a trading name. ).

The trigger for this nightmare was, at the direction of their staff, I used their paying in machine. These scan the cheques and apparently, now the name on the cheque must match their record of the business name, letter for letter. If it does not, the cheque is "destroyed". There is no plan B or way to correct this, nor will they return the cheque as they say its "their property". You can change the business name but they will not apply this to the destroyed cheques, only for future banking. In the example I made up above this would mean that cheques made to JoesCars would be rejected and destroyed to be replaced by new cheques to "JoesCars Taxi Services".

Obviously I am very very unhappy as the account was specifically opened to take cheques in my trading name just like these two and has been operating for 10 years without a problem with every single cheque banked for 10 years being exactly the same as the two destroyed cheques.

The moral of the story is don't use Lloyds new paying in machine or even better don't use Lloyds. I have switched all my accounts to other banks.

If every single Cheque had your trading name X on it and your account had Y it seems the moral of the story is to make sure your account has the correct trading name that will be used when making payments into it.

Ben8282 wrote: »

It surprises me that anybody actually bothered to check the payee name at all.
It surprises me even more that they should have been refused on the basis that you state.
I simply cannot believe that they then shredded the cheques.

Nobody did check the payee name, this was done on an automated machined which checked the name against the bank records.
But i have never head of them shredding rejected cheques.

colsten

18cc wrote: »

I think you should definitely submit a complaint to Lloyds and when you get a Deadlock letter go to the regulator

I reckon it's only worth complaining if the story is credible, which, from the evidence available to us forumites, is questionable.

You'd also not take a deadlocked complaint to the regulator, but to the FOS

Wheres_My_Cashback

OopNorfJonny wrote: »

On Monday I banked 2 cheques with Lloyds for 2 1/2 grand, but instead of clearing them they have shredded them and told me I must get new ones.
.

I think your username should be Jack;)

Terry_Towelling

OopNorfJonny wrote: »

On Monday I banked 2 cheques with Lloyds for 2 1/2 grand, but instead of clearing them they have shredded them and told me I must get new ones.

I have switched all my accounts to other banks.

You are a fast worker. You only paid in on Monday and by 8.54am on Wednesday morning you'd switched all your accounts away!

PS you still need to get new cheques.
PPS why would Lloyds tell you your trading name was wrong? You're trading name is right; it is the payee name on the cheques that doesn't match?
PPPS why would Lloyds shred the cheques? Now they have no evidence to support their reason for doing so.

I smell another rat.

18cc

Well I feel a bit silly now really as I took him at face value and try to offer some advice based on the problem he was presenting

jonesMUFCforever

It is to do with the new cheque clearing system that will be nationwide by end of the year - you can pay a cheque using your mobile now up to £500 the bank automated machines is the next step.
My local Halifax machines do this - any rejected cheques are kept by the bank where they are banked and ultimately shredded - you get a letter with an image of the cheque (similar to the one you get with the receipt)and it is up to you to get a replacement.
Again I would always use a cashier rather one of these machines - just in case.
A complaint will get you nowhere.

OopNorfJonny

For those requiring proof that this has happened, what proof would you like? Lie detector test? Or are you happy to wait until it happens to you? Having discussed it with my trade contacts, I am not the only one who has suffered this. Its all part of the new system which scans the cheques. If the bank computer expects something different from what is on the computer then the deposit will be rejected. Rejection means the check will be "destroyed". they didn't say how it would be destroyed , so I have made the assumption it was shredded because I can't see Lloyds staff huddled round a bonfire once a day.

I now have 2 letters from Lloyds ( available for sceptics to see if you want ). unlike customer services, it does not mention destroying cheques it says they have "failed validation and has been withdrawn". So you can see, I cant be making this up as only a bank can lie like that.

They helpfully go on to say " If a payment has been withdrawn you may wish to contact the issuer of the item(s) for further information and possibly obtain funds by an alternate method" !!!!!!!!

For those who commented I was quick to open a new account, well your right, I couldn't move quick enough. Wouldn't you close an account immediately if your bank shreds 2 and a half grads worth of your cheques? I paid in the cheques Monday, noticed a problem Tue midday and phone customer services. I was in their branch within the hour and by the evening I had opened 3 new accounts with 3 new banks ( Private , Business and Savings ) The Business account went to Starling Bank and they were remarkably quick with the new account being operational by the following morning, ie Wed and I have already transferred some of the Lloyds money into it. My main current account I put with First Direct and they are a bit slower but it will use this fancy switching service which moves all direct debits, funds etc over to the new account. Change day is set for as soon as they can do it .

Also on Wed morning, I submitted a complaint to financial-ombudsman.org.uk. I had already complained to LLoyds Customer Services on the phone and in branch and got nowhere. I don't see any advantage in corresponding with them further.

Re " If every single Cheque had your trading name X on it and your account had Y it seems the moral of the story is to make sure your account has the correct trading name that will be used when making payments into it." Do you work for Lloyds? That's what they said. Its all my fault apparently ! The account was opened with the branch manager, in the branch and was specifically opened to clear cheques made out in this trading name. So if the Branch manager says I can pay in cheques in my trading name and I successfully pay in cheques in my trading name , then why would I need to check anything ?????? Every cheque for 10 years has been exactly the same as the shredded ones ! I have even looked up the very first entry of the very first cheques from when I opened the account and in all probability I had them with me when I opened the account, and just like all of the hundreds of cheques for the last 10 years, they are made out to my trading name.

This is all very bizarre when you compare it to practice for private name cheques where it seems anything goes. I can use first initial and surname, first name and surname, first name middle initial and surname or all 4 names in full. will they start shredding those in future too?