Co-operative bank refusing to pay £125 refer-a-friend offer FOS case

Bridlington1

Good morning,

I would first like to take the opportunity to thank @Alex9384 for the suggestion to post this in a separate thread. As many of you will be aware from reading the Co-operative Refer a Friend switching offer thread, I received £50 as part of Co-op's refer a friend offer in spring 2022. I then switched out my Co-op bank account in November 2022, opened a new one shortly after the switch completed and then switched an account to them again to get the £125 refer a friend offer.

Despite some on this forum reporting they have successfully received payments under both the £50 and the £125 offers, Co-op have been refusing to pay up in my case. In December I took the matter to the FOS, on the grounds that the £50 offer and the £125 offer were separate offers and that as I held no accounts with Co-op at the time I applied for my second account with them I was a new customer and therefore eligible for the £125 in line with the offer Ts&Cs.

In April I received an email from my case handler saying that they had sided with Co-op on the grounds that the £50 and £125 offers were the same offer since there was no evidence of the £50 offer being withdrawn. The response was as follows:

Dear Bridlington1

Your complaint about The Co-operative Bank Plc

  

Thank you for your patience whilst I’ve been looking into your complaint.

I am the adjudicator who’ll be reviewing your case against The Co-operative Bank Plc (The Co-op). It’s my role to look into the concerns you’ve raised and let you know what I think is a fair outcome in the circumstances. You can find out more about how we handle complaints on our website. My contact details are below. If you need to contact me, my usual working hours are Monday to Friday 9am-4.30pm.

I’ve now reviewed all of the information available and I’m ready to start. Based on what I’ve seen, I won’t be asking The Co-op to do anything else. And I’ll explain why.

The complaint

You’re unhappy that The Co-op have not paid you the £125 promised with their current account ‘Refer-a- Friend’ switching campaign. You would like The Co-op to pay you the £125 promised, the £1 cost you spent in making the phone call to complain and an apology for the inconvenience caused.

Background

You’ve sent us supporting documents with your complaint and you told us in the complaint form that:

• The Co-op have not paid you the £125 promised with their current account ‘Refer-a- Friend’ switching campaign
• The Co-op have said that you already benefitted from the ‘Refer-a- Friend’ offer and you weren’t a new customer
• you agree that you benefited from the £50 Refer-a- Friend offer but you believe the £125 was an entirely separate offer with separate terms and conditions and you have not benefitted from this offer
• you said that at the time you applied for your second Co-op account you held no other accounts with them and considered yourself a new customer within the terms of the offer.

The Co-op sent us their business file and have told us the following:

• their ‘Refer a Friend Scheme’ was launched by the Bank in November 2020.  At the time existing customers who referred a friend to the Bank were eligible to receive a payment of £50.
• in May 2022 you switched in your account from Lloyds Bank to the Co-op and received a £50 credit as part of the Refer a Friend Scheme which you don’t dispute.
• in July 2022 they amended the terms of the scheme to allow existing customers to refer five eligible customers and receive a total of £250, were as previously customers could only make two referrals and receive £100 in total. 
• in November 2022 they amended the terms of the scheme further and increased the amount to be awarded to £125 for both parties.  In addition, they also amended the definition of the term ‘new customer’ enabling customers who had held an account since June 2021 (but did not currently hold an account with the Bank) to be eligible.
• on 4 November 2022 they received a bank switch request from the Royal Bank of Scotland and your account was switched out on 11 November 2022, and the account closed on 14 November 2022.
• on 15 November 2022 they received a new application for a current account from yourself and this account was opened on 16 November 2022 and on 17 November 2022 they started the process to switch in your account from Lloyds Bank.
• even though you didn’t hold a current account with the Bank at the time you made your latest application, you were still not eligible for the incentive payment as section 3.6 of the scheme terms and conditions clearly state that ‘The Recommended Friend is entitled to only one payment even if they switch more than one account to us or if more than one Recommender refers them’.
• one of the qualify points of the scheme advertisement states that, to be eligible for the offer the person you are referring must; ‘Complete a full switch from their main current account to their new Co-operative Bank account using the Current Account Switch Service.’ They do not believe you switched your main current account based on your account behaviour (account activity).
• as you previously received a payment under the scheme, you aren’t eligible to make a further claim as you can only claim for one payment irrespective of the number of accounts you switch into the Bank.
• their £125 offer was not a new scheme and you therefore weren’t entitled to a new pay-out
• the ‘Refer a Friend Scheme’ was launched in November 2020. They amended the existing scheme but did not withdraw the scheme until 16 December 2022. There was no notice on their website announcing an end to the scheme before December 2022

 

My findings

My role is to consider what both sides have said, along with any evidence provided – to decide if The Co-op have acted fairly. In doing this, I’ve thought about things such as the law and regulation in place at the time, as well as good industry practice. And whether their actions were fair and reasonable.

After reviewing the case file, I have considered all evidence received from yourself and The Co-op including listening to the call recordings you had with The Co-op.

I’ve not been able to find that the 'Refer a Friend' Scheme which launched in November 2020 ended at any point (or was relaunched) before December 2022.

The web information I’ve seen shows that there weren’t two separate offers but only a single one which had been ongoing for quite a length of time.  The offer amount was enhanced and the scheme terms & conditions were updated during the lifetime of the scheme. I’ve found that The Co-op only ended the scheme for the first time in December 2022.

Looking at the updated £125 terms & conditions document I think you would have been considered a new customer as I don’t think the requirement to switch your main current account was clear.

However, looking at the terms & conditions of the £50 and updated £125 document, I think it’s clear that the bank intended to pay out only once to each new consumer switching into their bank who had never benefited from the scheme before.

I therefore don’t think you were eligible for a second payment under the same Refer a Friend scheme because I can’t find that you met the full terms and conditions attached to the scheme as it was still the same campaign.

While I acknowledge that you made a mistake in believing you were eligible to benefit from what you thought was a brand-new offer, I’m not able to hold The Co-op responsible for this mistake. You had already benefitted before.

I appreciate you may be disappointed and that this is not the outcome you were expecting, but I think The Co-op have acted within their terms to withhold the payment, so I won’t be asking them to do anything more.

Next steps

I think this is a fair outcome in the circumstances, for the reasons I’ve explained. If you accept my view, please let me know as soon as possible and we'll close your complaint.

But if you decide that you don't accept what I’ve said – and want an Ombudsman to make a final decision on your complaint – you must provide any further evidence or representations by 6 April 2023. Requests for more time must also be made by that date. If I don’t hear from you by 6 April 2023 we might not be able to look at your complaint again.

If both offers were the same offer then surely nobody would have been able to receive payments for being referred under both the £50 and £125 offers.

I have since sent my case handler evidence from this forum of people having received both the £50 and £125 payments as well as details of the 2 switching incentives that Santander launched in August 2022 in which Santander launched a £160 switching offer then launched an entirely separate £175 switching offer despite never having announced that the £160 offer was going to be withdrawn. I also asked that a final decision on my case be made by an Ombudsman.

Yesterday I received the following response from my case handler:

Dear Bridlington1

Your complaint about The Co-operative Bank Plc

Thank you for your email.

 

I’ve looked at everything you’ve said and the documents you attached most of which relate to Santander Bank.

 

I’ve read what was written from the Money Saving Expert blogs but I still don’t consider that the £125 was a new offer. Under section 4.1 of the Co-operative Bank terms and conditions the scheme states;

 

‘We can withdraw this offer at anytime and should we chose to do so, we will update our website with the final switching date on which we will honour any payments’.

 

As explained in my view, I can’t see that the offer was withdrawn until December 2022 so I can’t find that it was two separate offers.

 

I’ve also seen the documents you sent on Santander however the only relevant documents I can consider are the terms and conditions relating to the Co-operative Bank which is where you opened your account and sought to partake in their offer.

 

In view of this, my view remains the same.

 

Please note that the ombudsman can only consider the complaint as was made to the Co-operative Bank so we won’t be considering your new request to look at the £125 refer-a-friend offer for the person who referred you. This will need to be raised with the Co-operative Bank by the person themselves.

 

An ombudsman will review this complaint

Because you didn’t agree, an ombudsman will review the complaint and make a decision. That means:

• An ombudsman will look at everything that’s been provided and make an independent decision. They’ll put the decision in writing to both you and Co-operative Bank, and explain their reasoning within the decision.
• If the ombudsman’s conclusions are different from mine, they will explain why and let you reply before they give you their decision. Otherwise, they won’t usually get in touch before issuing their decision unless they need more information.
• The ombudsman’s final decision will be binding on both you and Co-operative Bank if you accept it before the deadline they give you. So if the ombudsman tells the business to do something – and you accept the decision – the business will have to do it.
• We publish final decisions by our ombudsmen on our website. But your name won’t appear in the published decision – so you can’t be identified.

 

We should already have all the information the ombudsman needs to reach a decision. But if we need anything more from you, we’ll let you know.

What you need to do now

All of your previous and new submissions will be considered but if you still have any further points or information you’d like the ombudsman to consider, please send these to me by 1 May 2023. Please pay attention to the deadline.

If you need more time to reply, please let me know before this date. If I don’t hear from you, I will assume you do not want to add anything.

We will keep you up to date with our progress – but please get in touch if you have any questions.

Therefore I am looking for as much evidence that I can get my hands on that the £50 and £125 refer a friend offers were indeed separate offers.

If you have successfully received payments for being referred to Co-op under both the £50 and the £125 refer a friend offers if you could please post this information in this thread by the end of this month I would be most grateful. Also any suggestions as to what further evidence I could include would be much appreciated.

EDIT: An Ombudsman took the decision to uphold my complaint. For ease of reference please find below the link to the final decision:

https://www.financial-ombudsman.org.uk/decision/DRN-4464792.pdf

Band7

It seems that after you have successfully earned a lifetime ban from LBG, you seem to now be working on getting the same at the COOP 😩

TheBanker

I have to say I don't think you'll win this one. The FOS have to decide based on the circumstances of your complaint. The fact someone else received two payments when they possibly shouldn't have doesn't alter the adjudicator's interpretation of the terms and conditions. And Santander's terms are irrelevant since you're complaining about the Co-op. 

datz

I suspect that what is said on these forums (blogs?) will just be viewed by the FOS as anecdotal and unsubstantiated. They will likely adjudicate based on the written terms and conditions of the switching incentive/offer - which are perhaps not as clear as they could be.

The terms and conditions (including the pdf) for that offer are still available on the coop bank website, and don't explicitly discuss eligibility based on previous iterations of the (admitedly similar) offers. It states (pdf):

2. Recommended Friend
2.? To qualify for this offer as an eligible new customer you must:
2.?.1. open a new Co-operative Bank standard Current Account or Everyday Extra Account (smile current accounts, Student Accounts and
Cashminder accounts are excluded from this offer. We will not pay either the Recommender or the Recommended Friend where a smile current
account, Student Account or Cashminder account is opened, even if a full switch is completed, or where any account application is declined); and
2.?.2. complete a Full Switch into your new account using the Current Account Switch Service (which will include the closure of your old account and
moving all your payment instructions to the new account on the day that your switch completes); and
2.?.3. complete the referral form contained on the offer webpage once you have your Co-operative Bank sort code, account number and switch end
date; and
2.?.4. Your Co-operative Bank current account must be open at the time the incentive is due to be paid, in order to be eligible to receive the payment.

But then later it also states:

3.6 The Recommended Friend is entitled to only one payment even if they switch more than one account to us or if more than one Recommender refers them.

Which I presume is the clause that the coop is relying on, and what the adjudicator is referencing - i.e. that these are both the same offer, even though the values differ substantially, with one replacing the other? There are far clearer ways to have worded this.

I feel that this might just come down to a coin toss when it reaches the ombudsman, but I don't fancy your chances...

TheBanker

datz said:

I suspect that what is said on these forums (blogs?) will just be viewed by the FOS as anecdotal and unsubstantiated. They will likely adjudicate based on the written terms and conditions of the switching incentive/offer - which are perhaps not as clear as they could be.

The terms and conditions (including the pdf) for that offer are still available on the coop bank website, and don't specifically discuss eligibility based on previous offers. It states (pdf):

2. Recommended Friend
2.? To qualify for this offer as an eligible new customer you must:
2.?.1. open a new Co-operative Bank standard Current Account or Everyday Extra Account (smile current accounts, Student Accounts and
Cashminder accounts are excluded from this offer. We will not pay either the Recommender or the Recommended Friend where a smile current
account, Student Account or Cashminder account is opened, even if a full switch is completed, or where any account application is declined); and
2.?.2. complete a Full Switch into your new account using the Current Account Switch Service (which will include the closure of your old account and
moving all your payment instructions to the new account on the day that your switch completes); and
2.?.3. complete the referral form contained on the offer webpage once you have your Co-operative Bank sort code, account number and switch end
date; and
2.?.4. Your Co-operative Bank current account must be open at the time the incentive is due to be paid, in order to be eligible to receive the payment.

But then later it also states:

3.6 The Recommended Friend is entitled to only one payment even if they switch more than one account to us or if more than one Recommender refers them.

Which I presume is the clause that the coop is relying on, and what the adjudicator is referencing - i.e. that these are both the same offer, even though the values differ substantially, with one replacing the other?

I feel that this might just come down to a coin toss when it reaches the ombudsman, but I don't fancy your chances...

I don't think it will come down to a coin toss. Firstly because if FOS have received a few of these cases, they've probably discussed them to ensure consistency in decisions. Secondly because of clause 3.6 as quoted above. It says 'The Recommended Friend is entitled to only one payment even if they switch more than one account...' Yes, it could be clearer but I think the FOS will decide that a reasonable person would not interpret that as being entitled to two payments provided the value is different.

Remember FOS take an approach of what is 'fair and reasonable' - they do not analyse things in the same way that a court might. Usually their 'fair and reasonable' approach is beneficial to the customer, but in this case it is benefiting the bank. 

datz

TheBanker said:

Usually their 'fair and reasonable' approach is beneficial to the customer, but in this case it is benefiting the bank. 

I don't disagree with your assessment, but I do think there is some question over the clarity of the terms, as written. In this case, the coop could have, and should have, been much clearer when running multiple iterations of (similar) offers. Usually banks will state something like "any incentive from <insert specific date>" to avoid confusion.

Anyway, it might not entirely be to the benefit of the bank - at least Bridlington might be able to take some solace from (perhaps) costing the Coop £750 (think this is what the case fee is now).

Alex9384

Co-op is in the wrong here.

I've never had problem with any other bank T&C but Co-op T&C are deliberately written in a way that can deceive customers and it seems like they count on it.

Someone said somewhere on this forum that Coop previous offers (dating couple years back) had the same vague wording and caused the same issue. Coop obviously never bothered to improve the wording, instead they keep using the old one. Seems like they still rack up many new customers, just enough that the benefit outweighs the cost of them paying a few FOS cases of people filing a complaint.


In my case, they refused to pay me out and sent me this email:




That is false.
I have not benefited from this offer. I benefited from previous offer of £50 in June/July 2022 after applying for my first-ever Coop account. I didn't like their online banking and switched my Coop account elsewhere in November 2022, so I was no longer a customer. The offer ended in December 2022.
On the 1st February 2023 they started a new offer of £125. I applied and met all the criteria. They refused to pay me out.

Now, you may say that "this offer" means "Refer a friend" offer in general. But this is not specified anywhere in their T&C, so it's reasonable to assume that "this offer" means a specific offer with specified amount of money and specified time period.

How difficult is it to include a clause saying "You can only benefit from Refer a friend offer once in a lifetime" ? Is there any reason to not explain it clearly like that?

For comparison, other banks always state clearly either that in order to be eligible, you can't have ever had bonus before, or they include a cut off date for the previous offer, for example HSBC now introduced a new switch bonus for those who haven't had any since January 2020.

"3.6 The Recommended Friend is entitled to only one payment even if they switch more than one account to us or if more than one Recommender refers them."

One payment per offer? One payment per whole scheme? One payment per any Coop offer ever? One payment in a specific period? Their T&C don't specify any of that, so it can by any of those.

It simply means I'm not going to try get £125 on the 20th February and then try to get another £125 on the 25th February after being referred by another friend, just 5 days later.

Alex9384

Also, the email states "you are only able to receive one recommendation payment" and points to their link with T&C.
The T&C however, does not say "one recommendation payment". Can anyone find it anywhere in the T&C? It only says "one payment", not mentioning recommendation in this context.

I can provide our communication via their online banking message system. I asked them to copy-paste any part of their T&C that specifies what is "this offer". They didn't provide it. I asked again, they came back with a nonsensical reply, saying that the previous customer representative is right and I can only get payment once. Lol, what? I never questioned if the other person was right, I asked them to copy-paste something from their T&C, which they obviously cannot do, because it's simply not there.

WillPS

I think there's a compelling case for the second £125 period, as there was a gap between. The first £125 can be argued to be an improvement of the existing offer since there was no gap prior.

phillw

Alex9384 said:

I've never had problem with any other bank T&C but Co-op T&C are deliberately written in a way that can deceive customers and it seems like they count on it.

Deceive those who try to fleece them, into switching an account at no cost to the customer, at cost to the bank, knowing that they already switched away & will likely switch away again?

I fail to see what is in it for the coop.

flaneurs_lobster

Alex9384 said:

Co-op is in the wrong here.

I've never had problem with any other bank T&C but Co-op T&C are deliberately written in a way that can deceive customers and it seems like they count on it.

My situation is much like yours, although I benefitted from a £125 payout on 16 Jan 23 and closed the account later that month.

My second bonus was refused on 03 March.

Are you intending on making a formal complaint with a possible onward referral to the FO? 

TBH, I have never had need to complain to a bank much above waiting over a week for a new cheque book. A look over the Co-op website didn't find an obvious way to start this process.

An idiot's guide to the steps to take would be much appreciated. I assume that you would start by referencing their refusal letter?