Lloyds bank account closure

n00blit

Hello everyone,

I am at a loss here. Out of nowhere, Lloyds Bank has suddenly decided to close all of my accounts within the group including my business account.

I have had a current account with them for several years. I have always been in good standing, never been a victim of fraud nor have I committed any acts of fraud or money laundering. Always paid towards my overdraft.

The only recent changes I can think of is that I had a business savings account which needed closing and I wanted to open a new business current account for a new business that I am trying to start. I submitted my application, jumped through all of their hoops, provided my ID and finally the account was opened, I even have the card and welcome pack to prove it.

I then also applied for CIFAS Protective Registration. And then a few days later, all of the sudden, everything gets closed. My cards no longer work, online banking has been taken away.

I spoke with the accounts review team and they couldn't give me an answer, they just said it's confidential! They said that in the same way that I can close the account without a reason, so can they!

But this isn't the same as me closing an account without reason, I'm a paying customer, surely they owe it to me to explain why they're closing my account, surely I have a right to defend my self or explain any misconceptions they may have about me?!

Now they expect me to pay back the overdraft in full within two months or they will then pass it on to the collections team and it will affect my credit score.

I just can't understand how they have the power to just do this without any explanation or justification!

Has anyone got any advice on what I can do to find out what happened? Can I submit a subject access request? Or submit a Freedom of information act request? Is there anything I can do to reverse this?

This has now lead me into a great depression as I have no idea where I am going to get the money from to pay for the overdraft.

Thanks for reading!

eskbanker

The Ts & Cs of the accounts you have with them will state (a) that they do indeed have the right to close accounts and (b) that overdrafts are repayable on demand (they're not intended for long-term borrowing), so, although there's nothing stopping you from sending in a subject access request (not FOI though), you won't find out anything particularly useful and it won't change anything, so best bet will be to get on with trying to arrange accounts and borrowing from elsewhere.

It seems unlikely that your application for CIFAS protective registration would be anything other than a coincidence, but no harm in issuing a subject access request to CIFAS and checking your credit files, in case of anything untoward there that may have spooked Lloyds.

F1shyFingers

n00blit said:

Hello everyone,

I am at a loss here. Out of nowhere, Lloyds Bank has suddenly decided to close all of my accounts within the group including my business account.

I have had a current account with them for several years. I have always been in good standing, never been a victim of fraud nor have I committed any acts of fraud or money laundering. Always paid towards my overdraft.

The only recent changes I can think of is that I had a business savings account which needed closing and I wanted to open a new business current account for a new business that I am trying to start. I submitted my application, jumped through all of their hoops, provided my ID and finally the account was opened, I even have the card and welcome pack to prove it.

I then also applied for CIFAS Protective Registration. And then a few days later, all of the sudden, everything gets closed. My cards no longer work, online banking has been taken away.

I spoke with the accounts review team and they couldn't give me an answer, they just said it's confidential! They said that in the same way that I can close the account without a reason, so can they!

But this isn't the same as me closing an account without reason, I'm a paying customer, surely they owe it to me to explain why they're closing my account, surely I have a right to defend my self or explain any misconceptions they may have about me?!

Now they expect me to pay back the overdraft in full within two months or they will then pass it on to the collections team and it will affect my credit score.

I just can't understand how they have the power to just do this without any explanation or justification!

Has anyone got any advice on what I can do to find out what happened? Can I submit a subject access request? Or submit a Freedom of information act request? Is there anything I can do to reverse this?

This has now lead me into a great depression as I have no idea where I am going to get the money from to pay for the overdraft.

Thanks for reading!

Pay the overdraft back on your own terms. It really is that simple. You don't have the money to repay it in full and they can't get blood out of a stone.

Olinda99

eskbanker said:

The Ts & Cs of the accounts you have with them will state (a) that they do indeed have the right to close accounts and (b) that overdrafts are repayable on demand (they're not intended for long-term borrowing), so, although there's nothing stopping you from sending in a subject access request (not FOI though), you won't find out anything particularly useful and it won't change anything, so best bet will be to get on with trying to arrange accounts and borrowing from elsewhere.

It seems unlikely that your application for CIFAS protective registration would be anything other than a coincidence, but no harm in issuing a subject access request to CIFAS and checking your credit files, in case of anything untoward there that may have spooked Lloyds.

Whereas I agree that (as with all banks) Lloyds have the right to close the OP's accounts I do feel that in this day and age where banking is really a necessity that it is wrong to do this without even giving a reason or a chance to appeal, query or even know how to change behaviour so that it doesn't happen again. It is not in the spirit of treating your customer fairly.

Sensory

Olinda99 said:

eskbanker said:

The Ts & Cs of the accounts you have with them will state (a) that they do indeed have the right to close accounts and (b) that overdrafts are repayable on demand (they're not intended for long-term borrowing), so, although there's nothing stopping you from sending in a subject access request (not FOI though), you won't find out anything particularly useful and it won't change anything, so best bet will be to get on with trying to arrange accounts and borrowing from elsewhere.

It seems unlikely that your application for CIFAS protective registration would be anything other than a coincidence, but no harm in issuing a subject access request to CIFAS and checking your credit files, in case of anything untoward there that may have spooked Lloyds.

Whereas I agree that (as with all banks) Lloyds have the right to close the OP's accounts I do feel that in this day and age where banking is really a necessity that it is wrong to do this without even giving a reason or a chance to appeal, query or even know how to change behaviour so that it doesn't happen again. It is not in the spirit of treating your customer fairly.

Agreed. Taken to the logical extreme, every banking and even e-money institution could conceivably refuse to provide services without providing a reason, and the individual would then be severely disadvantaged and have zero knowledge as to why, and no recourse to investigate or appeal.

robatwork

You will probably need an investigative journalist who can contact their press office to get anything approaching an honest answer. You could try Tony Hetherington, Katie Morley or yer man Martin Lewis himself. 

I haven't put links up but you can google any of these names to find their respective websites. 

anotheruser

Try BBC 4's Money Box too.

Thrugelmir

n00blit said:

This has now lead me into a great depression as I have no idea where I am going to get the money from to pay for the overdraft.

What happened to the funds in your business savings account that you closed? 

GTR_King

so what did you use the business account for??

How did you have business savings account but no business account where did the funds go?? 

You can't use business account/savings account for personal use (Breaks T&C's) and any money from that account to your personal one has to be recorded with your business manager and have a good reason E.G Pay your monthly wages etc

What business did you try start??

Usually (All banks) Lloyds can close your account down at any time if they suspect Fraud Money Laundering/T&C's have been Broken and can ask you to repay overdraft straight away or within a time frame, they are legally not allowed to tell you the reason why your account is being closed so they don't tip you off

you will be Barred from Lloyds Banking group for a few years so best to try open another personal bank account ASAP (If no CIFAS Marker) with a different banking group.

If you broke Lloyds T&C's it highly unlikely they will revers it. 

Sounds like from what you posted you broke Lloyds T&C's of your personal account/Business account only you know what one you broke have a read through the T&C's should be on lloyds website or letter when you opened your account, so you can check what you T&C's you broken and learn not to do it again, 

Good luck and hope you get things sorted  

Olinda99

"Sounds like from what you posted you broke Lloyds T&C's of your personal ..."

It shouldn't have to 'sound like' - the customer should be told why the account was closed.

[Deleted User]

Olinda99 said:

"Sounds like from what you posted you broke Lloyds T&C's of your personal ..."

It shouldn't have to 'sound like' - the customer should be told why the account was closed.

They don't have to and are unlikely to do so as they wish to simply dissolve the relationship.