Closed account not really closed by Sainsbury Bank….

th3rdroc

I took out an interest free credit card from Sainsbury as an simple way to fund a car for my son (we do not bank with Sainsbury as such)
not used for anything else at all, all monthly payments aligned to interest free term….all paid and closed the card with Sainsbury….or so I thought.

Several months later, my wife accidentally paid her card bill onto my old Sainsbury number….it went through.
We were surprised to get a sainsbury card statement for my “closed” account….  Only then realising the mistake
I called and the money was returned in 7 days…..fine
I asked how funds were allowed through to a closed/cancelled card….and the fun began.

after several calls going over the same thing with (I think it was 4 different people on multiple calls) and being advised to raise a complaint to get the card closed (done!), it came down to 2 key sticking points
1. they say the account is closed, I say it can’t be as funds are allowed in…..so it is only half closed….back and forth, no resolution
2. they say they are legally obliged to allow funds onto a non existent card for 7 years “in case of refunds !! (note it is not about historical records of past transactions, by all means keep them for a statutory period!)
I say this this seems to be confusing records retention with future activity. I understand other issuers do not allow monies onto a dead card….waste of breath with Sainsbury, there answer repeatedly is “your card is closed” 🤦🏼

so my question…
do you know the legal position here?
Are Sainsbury correct in saying they are legally obliged to keep the account half open while claiming it is closed…and any advice on closing the other half of the account?

(an analogy I used with Sainsbury was to consider a door. It is closed if I cannot get in or out. If I can still get in, the door is not really closed)

emmajones1976

If you pay money to a valid sort code and account number, which I assume is what you did via internet banking, then Sainsburys have to put it somewhere (either to the card number listed in the payment reference, or to one of their suspence accounts), it wouldnt get sent back automatically and either way you would still be contacting them to arrange the payment of it back.

You are getting far too hung up about the "closed" thing, which wouldnt stop this happening again until you delete the payee.

th3rdroc

Mmm, My point is this is a credit card that no longer exists….so the account is not valid.
other banks decline transactions to non existent accounts….including closed credit card accounts…..

Nofinway

Like emmajones1976 I think you're getting a bit hung up about the whole closed thing. 

Why does it even matter to you? What are you hoping to achieve?

The explanation in your point 2 makes perfect sense to me but not to you - why not?  An account can be 'closed' to new normal business transactions but still be 'open' to allow for anomalies as described in point 2. 

emmajones1976

th3rdroc said:

Mmm, My point is this is a credit card that no longer exists….so the account is not valid.
other banks decline transactions to non existent accounts….including closed credit card accounts…..

Right OK, so when you (or your wife, I dont care who did it) made the payment to Sainsburys incorrectly, what did you actually want to happen given the sort code and account number you paid to would have been perfectly valid?

born_again

emmajones1976 said:

th3rdroc said:

Mmm, My point is this is a credit card that no longer exists….so the account is not valid.
other banks decline transactions to non existent accounts….including closed credit card accounts…..

Right OK, so when you (or your wife, I dont care who did it) made the payment to Sainsburys incorrectly, what did you actually want to happen given the sort code and account number you paid to would have been perfectly valid?

Well the funds would have sat in that internal account until someone got round to auditing payments that had been sat there for months & not allocated to a account.
Or they wait till the payee complains to their bank and the payment gets chased.

redux

Unless you're likely to send more money to it, this isn't really an issue.

A couple of years ago I applied for a new card at Sainsburys. They declined on the basis I could not have two accounts. I phoned up and pointed out the old account had been closed for some years. They said they had had some issues like that, but would sort it out. I haven't reapplied since, so I don't know if it's ok now.

But unless you want to apply for a new account, this won't affect you either, and maybe they've fixed it by now anyway.

emmajones1976

born_again said:

emmajones1976 said:

th3rdroc said:

Mmm, My point is this is a credit card that no longer exists….so the account is not valid.
other banks decline transactions to non existent accounts….including closed credit card accounts…..

Right OK, so when you (or your wife, I dont care who did it) made the payment to Sainsburys incorrectly, what did you actually want to happen given the sort code and account number you paid to would have been perfectly valid?

Well the funds would have sat in that internal account until someone got round to auditing payments that had been sat there for months & not allocated to a account.
Or they wait till the payee complains to their bank and the payment gets chased.

Exactly, either way it would involve chasing of some kind. If they assign the money to a closed account until the ex-customer rings up to claim it, so what?

EarthBoy

th3rdroc said:

other banks decline transactions to non existent accounts….including closed credit card accounts…..

How do you know what other banks do? How many other closed credit cards have you sent payments to?

emmajones1976

"Other banks" paid in the same way as the OP (or his wife, who cares) would handle the payment in exactly the same way, and would still involve some chasing to get it back.

th3rdroc

Interesting comments, but not of practical use.

as can be found on a basic search, most banks close an account on request and refuse monies in or out.
many replies either don’t believe this, or think it is ok to leave an account in this interim state.

answering a couple of other points/questions posted:

saisbury’s have to put the money somewhere….no, they should refuse monies to a closed account

what would I want to happen to funds attempting to be put into a non existent account? I would want the payment to be refused, perhaps with a message along the lines of “this account is closed…”

why does it matter to me…I don’t want half closed accounts in my name. I don’t want to monitor them in case something is done in my name, I don’t want any funds locked up by mistake and/or correct payments missed. I want a closed account, well, to be closed

the funds would have sat there until….Exactly. I don’t want funds sat in a closed and forgotten account

oh well. Thanks all, I’ll stop monitoring/close this post now, so won’t be checking for incoming funds, oops, posts I mean 🙄