Nat West Bank account closed for putting someone else’s money into it

james72

I will try to be brief – just wanted some advice

 

In 2020, because of a recent bankruptcy, I didn’t have a bank account. And because of the virus I went onto UC [and housing] – as my industry has been one of the hardest hit by covid. First to close and last to open.  

 

UC suggested opening a post office account, which was difficult for me, and not helped by me changing my name and not in receipt of a new passport.

 

They also repeatedly suggested I could put the money into someone else’s account. Which was a last option, as it was somewhat of a hassle and a big favour to ask of anyone. Friend or family.

 

In the end, this is what I did. A friend who now I feel awful for. As it’s my fault what has happened.

 

She checked with her accountant, who also said it would be fine, as long as it was all logged and everything correctly [not sure of the correct terminology – but this was done how she was advised].

 

Fast forward. To now.

 

Her bank, Nat West, advised her – that UC and her accountant were wrong. You can’t put other people’s money into your account. They said they sent her a letter in December to inform her they were cancelling her account. Which she has never received [not that, that is important].

The person she spoke to today suggests that she will now find it hard to open any account. She is really upset and is now convinced all her good credit and everything has been mucked up. She won’t be able to get a mortgage anytime soon. She owns a couple of small flats she rents out – but was looking to buy a home this year.

 

Anyway, she is super upset.

 

I feel awful to be the cause of this.

 

Is Nat West correct? [and UC and her accountant just got it wrong]

Will she find it hard/impossible as they suggest to open an account elsewhere [now there's a mark against her name]

 

Is there anything that can be done? Other than just me apologising – which I have done, but isn’t enough.

 

Thanks for any help/advice

Chris_English

Paying money into someone else's account is not a problem at all. There's no way that the bank would have any idea whose money it is, as money doesn't come with any owner identified, so there must be something more that's gone on here than you've mentioned so far.

Were you given access to the account, or were you allowed to spend money directly from it? Did you perhaps have your wages paid in, and then transferred out, regularly? Any of these could be a breach of the terms and conditions of the account.

eskbanker

If she has a couple of flats she rents out, and requires the services of an accountant, it sounds plausible to me that NatWest would be perceiving this as a business that shouldn't be run through a personal account, and would be closing her account down on that basis, rather than receipt of funds from DWP?

If someone at NatWest is suggesting that she'll find it difficult to open an account elsewhere, that may mean that they've reported her to CIFAS, so she should find out what's been registered there: https://www.cifas.org.uk/dsar

HobgoblinBT

Holding money in an account for someone other than the named owner of the account is likely a breach of Nat West’s banking terms and conditions.  These were agreed to when the account was opened and subsequent amendments acceptedby continuing to use the account.  

  If any electronic payments were received eg universal credit, the payees name would have been mismatched to the account holder’s name, which could have led to the review that resulted in the account closure.

As to the future, will one of the high street banks offer you a basic account?

nyermen

This is more than an account closure for terms breach, the above suggests a CIFAS marker or similar, which means they're suggesting something more serious such as fraud?

CIFAS Categories (from an old post - may be slightly out of date)
0 Protective Registration -- Recorded at the request of the person named.
1 False Identity Fraud -- Use of a false name with an address.
2 Victim of Impersonation -- Use, by another person, of this name and/or address.
3 Application Fraud (Facility Granted) -- Use of name reasonably believed to be genuine, but with one or more material falsehoods in personal details or other relevant information -; the facility was granted.
4 Application Fraud (Facility Refused) -- Use of a name reasonably believed to be genuine, but with one or more material falsehoods in personal details or other relevant information -; the facility was refused.
5 Conversion -- Conversion (disposal or sale) of goods (to which the hirer/buyer does not have title) under a hire purchase, conditional sale, contract hire, leasing or rental agreement.
6 First Party Fraud -- Opening an account or other facility for a fraudulent purpose, or the fraudulent misuse of an account or facility.
7 Aiding & Abetting -- Aiding, abetting or assisting, or conspiring with, another or others to fraudulently procure credit, or other facilities, or hire products or services.
8 Insurance Claims Fraud -- The making of a claim(s) under one or more insurance policy (ies) with one or more material falsehoods or by presenting a false or forged document.

eskbanker

HobgoblinBT said:

Holding money in an account for someone other than the named owner of the account is likely a breach of Nat West’s banking terms and conditions.  These were agreed to when the account was opened and subsequent amendments acceptedby continuing to use the account.

Do you have a specific clause in mind or are you just guessing?

HobgoblinBT said:

If any electronic payments were received eg universal credit, the payees name would have been mismatched to the account holder’s name, which could have led to the review that resulted in the account closure.

Are you suggesting that recipients of electronic payments have visibility of the payee name used by the sender?  I don't know if UC payments include the beneficiary's name within the payment reference field, but that's the only way I believe that any such discrepancy would be apparent....

cx6

The first step is to follow the advice of @eskbanker and ask your friend to do a CIFAS SAR and find out what type of marker they have.

Then you can see if you have grounds to get it removed. A solicitor is probably useful to have, eg:

https://www.setfords.co.uk/2022/01/06/a-guide-to-cifas-marker-removal-cifas-markers-explained/

"The first step is normally to obtain a report from CIFAS detailing the information about your marker. This will show you what has been alleged against you, and by whom. From there, you can attempt to gain more information from the financial institution that filed the marker, although they are under no legal obligation to provide you with anything beyond your bank statements.

You and your solicitor can then make a challenge to the financial institution directly. You will likely have to prove why the marker should be removed; simply stating that it has been unfairly filed is not enough.

The financial institution will then issue its final response. If they do not agree to remove the marker, you can directly challenge CIFAS, who must respond within 14 days.

From there, if CIFAS also refuse to remove it, a complaint can be made to the relevant ombudsman or similar service. This is usually the Financial Ombudsman Service for banks, or the Communications and Internet Services Adjudication Scheme for mobile phones.

If this still fails in your quest for CIFAS marker removal, in a small number of circumstances, it may be possible to challenge the decision by way of judicial review or injunction. Your solicitor will advise you if this is possible and the steps that need to be taken."

born_again

One thing is Nat West could be thinking this is benefit fraud. As Acc holder has 2 flats rented out. Then suddenly during pandemic starts getting UC's. When it was known that checks were virtually stopped on new claims.

james72

Chris_English said:

Paying money into someone else's account is not a problem at all. There's no way that the bank would have any idea whose money it is, as money doesn't come with any owner identified, so there must be something more that's gone on here than you've mentioned so far.

Were you given access to the account, or were you allowed to spend money directly from it? Did you perhaps have your wages paid in, and then transferred out, regularly? Any of these could be a breach of the terms and conditions of the account.

No access at all

But it was UC money going in

But UC and accountant said it would be fine 

Chris_English

james72 said:

Chris_English said:

Paying money into someone else's account is not a problem at all. There's no way that the bank would have any idea whose money it is, as money doesn't come with any owner identified, so there must be something more that's gone on here than you've mentioned so far.

Were you given access to the account, or were you allowed to spend money directly from it? Did you perhaps have your wages paid in, and then transferred out, regularly? Any of these could be a breach of the terms and conditions of the account.

No access at all

But it was UC money going in

But UC and accountant said it would be fine 

So it was withdrawn as cash and handed to you that way?

I suppose that it could still breach some banks' T&Cs, but it seems quite harsh. I have money paid into my account for my children from relatives, for their birthdays, and I'd not be happy if the bank tried to be difficult about that.

MalMonroe

If I were you my first step would be to contact UC and tell them what has happened as a result of their 'advice' and ask them to sort out the mess that's been caused by their stupidity.

Next step, I'd ask my friend to go to her accountant and do the same.

Then I'd apply for my own bank account. Bankrupts are allowed to have basic current accounts. See the info in this link -

https://www.stepchange.org/debt-info/bank-accounts-after-bankruptcy.aspx

For advice, you could contact Citizens Advice, info in the following link - 

https://www.citizensadvice.org.uk/resources-and-tools/search-navigation-tools/Search/?q=contact+us&c=TOP-PUBLIC

Here is a link to a thread from 2018 on this forum asking the same question as you -

https://forums.moneysavingexpert.com/discussion/5902677/whos-bank-account-do-benefits-have-to-be-paid-in

Scroll down to 'konark'.

Hope this is helpful. But Citizens Advice should help you and also, so should the benefits people.