Termination Notice

HiggiHiggins

Hi, received the attached letter from Barclays. In January this year they incorrectly applied their right to set off a payment from a debit account with no arranged overdraft and no credit balance. 

In short this took the account into an unauthorised overdraft, the debit was disputed but Barclays ignored this and debited the account leaving it over £500 overdrawn. At that point in January they reported the account as adverse to CRA and have done every month since which has impacted the joint account holders credit score.

the termination notice implies we have an agreement in place which they allege we have breached under the CCA 1974, as there’s no arranged OD we don’t have any credit agreement in place. The note also gives 30 days to repay the “debt” before they report it to the CRA (which they have already done since jan). Is the termination notice to close the account or on the overdraft facility. It seems that they believe an actual agreed overdraft was in place and that we are in breach of the CCA under that.

anyone any ideas? I’m just curious as to if we now paid the disputed debt before the 30 day deadline how would they stand having already reported the account and ruined our credit scores, could we claim for breach of contract?

sourcrates

Its a standard account termination letter, the exact terminology may not specifically apply to your account, but you get the gist.
All that will happen is the debt will go to the Banks collections dept., if you fail to make arrangements with them, it may be passed to an external debt collector or it may be sold.

If you feel the Bank acted incorrectly, then make a formal complaint.

flossy_splodge

Have a look at last weeks Martin Lewis show about how banks should be treating customers in difficulty. It was the CEO of HSBC  on there and whilst I am sure he thought what he was saying was true it was actually a load of hogwash.

His bank caused a vulnerable person I know to commit suicide.

Find the email of BArclays CEO and write directly - going through minions doesn't seem to work.

Good luck.

HiggiHiggins

But what falls under the consumer credit act if no credit agreement is in place?
surely the letter is one which should be sent prior to reporting the account adverse. They have to give you pre notice of their intention and time to repay the “debt”.

the ceo has been emailed and that was a waste of time, it’s been passed to an external solicitors appointed by Barclays as we have a civil claim going now

adamp87

An external solicitor’s already? For £500 that seems odd.  Banks don’t normally go down a legal route, particularly not for that sum, they’d usually sell the debt on to a debt chasing agency.

Can you give us more details here, What was the initial payment for - was it another debt with Barclays? 

And did you put any formal complaints in if you disagreed at the time back in January. 

I think all banks have it in their terms the right to offset your money for payments but it’s very rare it happens. 

HiggiHiggins

Hi Adam 
so sorry if not seen the email notification for your reply.

Ok so the initial issue arose from the bank refunding some payments they agreed were fraudulent and confirmed they had made a £500 refund payment to us for these.
this was withdrawn leaving a balance of £0.
they then wrote to tell us (without any evidence or reasons at all) they were reclaiming the £500 payment now claiming it was a “temporary refund” in contrast to earlier confirmation it was a full refund.
we disputed the payment, asked them not to withdraw it on numerous occasions, they failed to investigate our disputes and then executed their right to set off when they withdrew the £500 a week later. They knew the account had £0 balance and no arranged OD. 

Some 35 days after they took the account overdrawn they reported it adverse to the CRA.

numerous complaints raised over this in writing with Barclays we’re all avoided and they never commented on their actions.

After they took the account OD they then created a payment plan on their system claiming we had agreed to pay back the “debt” within 30 days. We found about about this once we received a letter telling us the credit plan failed. They claim there’s no copy of the agreement at all as the system doesn’t store anything, what a load of rubbish. System data actually proves an employee created and setup the plan and that we didn’t agree to this at all. They did this to make it appear we accepted liability for the debt and fraudulently created the plan.

In the period of 30 days the plan had been setup and running, they ignored all our calls and emails completely. This was so it couldn’t be claimed they should have brought the plan up in conversation. We were emailing during this period still disputing the payment and asking they look into this. The plan they created didn’t generate a letter to advice us what had been agreed, dates, figure’s etc, as had this been received by us we would have contacted them, questioning it and denying we had created it, this would then have forced them to cancel the plan they created. 

The FOS advised we seek legal action and so Barclays then passed the case to an external solicitor. It’s a £500 and they have offered us £1200 in compensation via the FOS and as good will gestures in complaint outcomes. We’ve rejected their offers. They are now employing a high end solicitor which we estimate to have cost over £20k - £25k already, to defend a £500 claim, makes no sense.

our credit scores been in tatters since January when we’ve had adverse markers monthly on the account. 

We understand the right to set off however they did this after giving less than 7 days to pay the debt they caused. They can’t however take this from a debit balance, that’s against FCA rules

MorningcoffeeIV

HiggiHiggins said:

 They are now employing a high end solicitor which we estimate to have cost over £20k - £25k already, to defend a £500 claim, makes no sense.

It won't be anything like that, as it will be under a retainer even if they are external.

It will be effectively zero in terms of incremental cost.

What's the basis of your estimation? If they sent you notification of the cost incurred and implied you're responsible for legal costs, forget it.

Also remember that your tattered credit score is of no interest to anyone but yourself. Only your credit files are considered.

HiggiHiggins

Estimation is purely based on our estimate for the time spent representing them, email, letters etc so very loose figure. Just baffles me that they will have their own legal team so why outsource it.

no costs warning yet but fully expectant of the meaningless letter and threat.

In terms of the letter, they quote sections of the CCA and then state “that it is a term of our agreement with the bank”. We don’t have an agreement with the bank, no overdraft and so no credit agreement was ever signed or in place. Are they thinking we have an agreed OD?

They also state that failing to repay the amount in the set time will register the account with CRA and this could affect our credit, they reported the account to cra in January (and monthly since) so they have already done this pre termination letter. 

Our view is that should we pay the “debt” then they should clear the account and not report anything etc. should we satisfy the terms of the notice then would they not be responsible for adversely affecting us from January and we have claim for damages?