Account Switch failure

Cottonsocks434

Back in March I switched my bank account from Barclays to Nationwide. Everything was accepted and I got my new debit card mid March.
A few of my direct debits failed and were cancelled for example my car tax, insurance, life insurance and pet insurance - resulting in some fees for me to pay as I had to manually call places and set up things again (and also me driving around with no tax without even knowing it) - this still isn't my biggest problem though.

You see, I was owed a £500 refund from the home office for a rejected visa, and I had been chasing this for months now. I went to Barclays today to get some bank statements from before my account with them closed back in March, only to find that the bank account was still open... with my £500 refund sitting in it!

How has this happened?? All my payments were transferred - for example my salary on 20th March was successfully redirected to my new Nationwide account. Yet when this refund came through two weeks later on 3rd April, it somehow didn't get redirected and sat in an account that I had assumed was closed?

My old account was -£250 in overdraft however this was to be covered by an IVA I unfortunately had to sign up for - this meant I was making monthly payments which included paying off this overdrsft as well as many other immigration visa related debts for my American husband (thank you very much, home office...). The fact that the refund went to this old account meant that my overdraft was brought back into black and I now only have £250 of this refund. I desperately was counting on this money in order to make a new application for my husband to join me in the UK.

Granted, I haven't ever received a letter from Barclays saying my account was closed however I won't lie to you; I don't know much about banking and wasn't really expecting one anyway. Therefore it never crossed my mind that I didn't receive this closure letter.

I'm really infuriated with this situation as not only have I been chasing a refund that I actually HAD, but I have also been charged account fees for this old account which I had thought was closed!!! By all means and purposes, a full switch (which Nationwide confirmed I made) is supposed to close the account you switched from. Yet to this day it sits open.

I need advice on what to do next. I fear Nationwide and Barclays are going to play a blame game with me, and I'll never see any of those account fees back nor get an apology for the serious inconvenience this has caused me. What's my best move?

sheramber

Could the old account have been kept open because there was an overdraft on it?

Emily_Joy

It's a bit hard to believe that you haven't had any communication from Barclays since March. Since the account remained opened, there must have been account statements and account statements notifications. I am not certain, but I would expect the bank keeping the customer up-to-date on overdraft as well.

PRAISETHESUN

In my mind, it sounds like your switch failed completely - did you receive any correspondence from Nationwide to say that your switch had successfully completed? Just because you received a card doesn't mean your switch was successful - the account opening process is quite separate from the account switching process. If the switch never completed, then your Barclays account would never have been closed. It's probably likely that Nationwide didn't agree to offer you an overdraft large enough to cover your existing one with Barclays, so the switch failed because of that. Following on from this, the reason for the DDs failing could be that they were pulling money from your Barclays account, which had zero funds.

It sounds like Barclays are using their right to set off to repay your overdraft from your refund - legally they are allowed to do this, but it might be worth getting in touch if it has caused you hardship. Technically its the duty of the receiving bank (Nationwide in this instance) to facilitate the switch, so any fees, interest, etc that you have been charged because of the failure to switch should be reimbursed by them - I would get in touch with them to complain.

colsten

PRAISETHESUN wrote: »

It's probably likely that Nationwide didn't agree to offer you an overdraft large enough to cover your existing one with Barclays, so the switch failed because of that.

I agree that the switch probably never took place. However, CASS doesn't deal with overdrafts at all. It's the account holder's responsibility to settle any overdraft on the old account before it can get closed.

From_the_CASS_FAQ wrote:

You will need to agree any overdraft facilities you require with your new bank or building society. Alternatively, they may be able to provide facilities to help you pay off any existing overdraft you may have, subject to their normal lending criteria. If you do not come to an agreement with your new bank you must make separate arrangements to repay your existing overdraft before you switch.

https://www.currentaccountswitch.co.uk/helpandsupport/Pages/help.aspx

Cottonsocks434

I got an email from Nationwide to confirm my switch had been made successfully and as I said, my paycheck got redirected into my new account so there's no doubt that some kind of switch did indeed take place.
I called Nationwide who confirmed on their books I have made a full switch to them. So I'm just not sure what happened with the refund and the failure to close my old account.

Surely if there was an agreement between my debt management company and Barclays that the overdraft would be paid for by them, there should have been no confusion about that account being closed and settled by this company?

Silver_Queen

Most likely, your account itself was switched but the overdraft remained active with Barclays. This is what happened to me when I switched mine a few years back.