Barclays Internal Scam??

NeilRed

Last Thursday I noted a withdrawal from my Barclays current account emptying all funds including the approved overdraft facility (which I have never used previously).  I assumed I had been subjected to some sort of scam and immediately contacted the bank to advise them and raise a complaint.  After a long weekend of stress wondering if it was going to happen again to my account or even other accounts with no response from them I called this afternoon.  I was advised of the good news (it wasn't a scam) and the bad news (it was Barclays doing some sort of "reconcile").  Nobody at the bank would be able to tell me anything about this except for the team involved.  They would/may be in touch with me "at some point".  Meanwhile I have had to scramble to find funds to pay off the overdraft and put money back into the account to cover direct debits etc. amounting to almost £4k!  I cannot think of any instance where I would owe this amount of money to anyone.  It was also strange that it was the exact amount to drain all of my funds.

Has this happened to anyone else?  Can they really do this legally? To whom do I have recourse in the event of them sitting on it for any length of time?  FCA?  

eskbanker

If it's caused by Barclays then I'd expect them to correct it at the earliest opportunity (same working day) and to accept all liability for any charges arising from bounced direct debits, plus any overdraft interest charged, plus a compensatory gesture for the stress and inconvenience.

Initial focus should obviously be on restoring the funds but if they then fail to resolve the complaint satisfactorily, you have the right to escalate it to the Financial Ombudsman Service.

Barclays should also commit to repairing your credit files if they've reported the fake overdraft to any or all of the rating agencies.

Ed-1

eskbanker said:

If it's caused by Barclays then I'd expect them to correct it at the earliest opportunity (same working day) and to accept all liability for any charges arising from bounced direct debits, plus any overdraft interest charged, plus a compensatory gesture for the stress and inconvenience.

Initial focus should obviously be on restoring the funds but if they then fail to resolve the complaint satisfactorily, you have the right to escalate it to the Financial Ombudsman Service.

Barclays should also commit to repairing your credit files if they've reported the fake overdraft to any or all of the rating agencies.

It's the AML/financial crime team that do this kind of thing based on previous stories of people going e.g. £1M overdrawn etc.

https://www.google.com/amp/s/www.birminghammail.co.uk/black-country/mum-1m-overdrawn-wakes-up-22487380.amp

mab3000

They haven’t done this just for the fun of it, and it’s not a scam. There will be a reason why they have withdrawn funds if it’s gone “to reconcile” on your transaction list.

Can you think of any reason at all why they might of had to do this? Recently sold something and the buyer paid you then may have reported the transaction as a scam? An usual deposit into your account? Or maybe something that’s lead to a court order to freeze your funds? 

The bank are more than likely legally required to withhold the reasons why they have done this, depending on the reason(s) why. 

Thrugelmir

Never heard of a bank "draining" an overdraft facility.  Were you advised to cover the overdraft that has arisen. 

Ed-1

Thrugelmir said:

Never heard of a bank "draining" an overdraft facility.  Were you advised to cover the overdraft that has arisen. 

It's a Barclays thing. Previous reports of them doing this have said that it's not proper debt and it doesn't incur charges or get reported to CRAs.

flo22

They emptied your account of funds but you had to pay off the overdraft?  This is confusing. If there was a debit balance there were no funds to empty.  You say you had never used the overdraft but then you say you had to pay off the overdraft - which is it?

Did they just remove the overdraft or was there an actual transaction moving funds somewhere?

MEM62

NeilRed said:

Last Thursday I noted a withdrawal from my Barclays current account emptying all funds including the approved overdraft facility (which I have never used previously). 

I'm sceptical.  Even if Barclays were offsetting against a debt held elsewhere with them they would not use you overdraft.  That would just be transferring debt from one account to another.  

NeilRed said:

To whom do I have recourse in the event of them sitting on it for any length of time?  FCA?  

If the facts are correct you first port of call is a formal complaint to Barclays.  

molerat

I have seen it mentioned here before, they remove all available funds which includes the overdraft amount whilst investigating.

grumbler

MEM62 said:

 first port of call is a formal complaint to Barclays.  

And say in this complaint that you hold them financially responsible for all consequences of failed DDs (if any) and mention the idiot that told you to "scramble to find funds to pay off the overdraft".

Ergates

grumbler said:

MEM62 said:

 first port of call is a formal complaint to Barclays.  

And say in this complaint that you hold them financially responsible for all consequences of failed DDs (if any) and mention the idiot that told you to "scramble to find funds to pay off the overdraft".

OP didn't say anyone told them to do that.