Santander free forever bank account changes

GeoffTF

Section62 said:

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

Again, if an Ombudsman directed Santander not to impose charges having promised to provide a 'free forever' business account, and Santander's response was to close the accounts instead, then I'd expect FOS to take a very dim view of that and it probably wouldn't be the end of the story.

This is hypothetical upon hypothetical. I think the point is that the Ombudsman might be deterred from making such a ruling if he thought that the customer's account might be closed as a result. I do not expect that Santander is relying on that though.

I think the opposite.  An Ombudsman is not going to be deterred by a bank's threat to close someone's account if the Ombudsman makes a determination the bank doesn't like.

I'm starting to wonder if people are forgetting that banking is regulated, and there are consequences for financial service providers if they break the rules.

For example, if a bank decided it was appropriate to use account closure as a 'punishment' for someone sucessfully complaining to FOS.  Do people really believe that would be Ok, and accepted by FOS and/or the FCA as reasonable conduct?

No threat is needed. The FOS is aware of the rules:

"Businesses that provide bank accounts are generally entitled to close them – just as their customers are. But you should treat your customers fairly. You shouldn’t close an account because of unfair bias or unlawful discrimination. And you shouldn’t usually close an account without giving reasonable notice."

https://www.financial-ombudsman.org.uk/businesses/complaints-deal/banking-and-payments/bank-account-closures

A closed account is free. Closing a bank account does not violate the original "free forever" marketing claim. That claim does not appear to be relevant anyway. It seems that the FOS will have to make its determination on the basis of the current T&Cs.

So would closing an account because an Ombudsman has determined it should continue to be provided free of charge (in accordance with a promise made by the bank) be considered 'fair'?  That is the fundamental question here.

A bank can close accounts because it no longer considers them be commercially worthwhile. That is considered to be fair (provided that the bank gives the required notice of closure).

eskbanker

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

Again, if an Ombudsman directed Santander not to impose charges having promised to provide a 'free forever' business account, and Santander's response was to close the accounts instead, then I'd expect FOS to take a very dim view of that and it probably wouldn't be the end of the story.

This is hypothetical upon hypothetical. I think the point is that the Ombudsman might be deterred from making such a ruling if he thought that the customer's account might be closed as a result. I do not expect that Santander is relying on that though.

I think the opposite.  An Ombudsman is not going to be deterred by a bank's threat to close someone's account if the Ombudsman makes a determination the bank doesn't like.

I'm starting to wonder if people are forgetting that banking is regulated, and there are consequences for financial service providers if they break the rules.

For example, if a bank decided it was appropriate to use account closure as a 'punishment' for someone sucessfully complaining to FOS.  Do people really believe that would be Ok, and accepted by FOS and/or the FCA as reasonable conduct?

No threat is needed. The FOS is aware of the rules:

"Businesses that provide bank accounts are generally entitled to close them – just as their customers are. But you should treat your customers fairly. You shouldn’t close an account because of unfair bias or unlawful discrimination. And you shouldn’t usually close an account without giving reasonable notice."

https://www.financial-ombudsman.org.uk/businesses/complaints-deal/banking-and-payments/bank-account-closures

A closed account is free. Closing a bank account does not violate the original "free forever" marketing claim. That claim does not appear to be relevant anyway. It seems that the FOS will have to make its determination on the basis of the current T&Cs.

So would closing an account because an Ombudsman has determined it should continue to be provided free of charge (in accordance with a promise made by the bank) be considered 'fair'?  That is the fundamental question here.

A bank can close accounts because it no longer considers them be commercially worthwhile. That is considered to be fair (provided that the bank gives the required notice of closure).

I think there may be some cross purposes at play here, but my view is:

Closing all accounts of a particular type, because of product withdrawal, is valid (although may not be seen as fair if breaching prior commitments, the acid test here).

Closing an individual account for a valid reason is indeed considered fair.

Closing an individual account because the holder complained successfully to FOS is highly unlikely to be considered fair.

Closing a selection of accounts on the basis of each holder having complained successfully to FOS is just asking for regulatory trouble!

In other words, 'fairness' is a concept that encompasses two related but different meanings, i.e. compliance with prior commitments is one thing but even-handedness (across customers) is a separate issue referred to by the same word.

clairec666

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

Again, if an Ombudsman directed Santander not to impose charges having promised to provide a 'free forever' business account, and Santander's response was to close the accounts instead, then I'd expect FOS to take a very dim view of that and it probably wouldn't be the end of the story.

This is hypothetical upon hypothetical. I think the point is that the Ombudsman might be deterred from making such a ruling if he thought that the customer's account might be closed as a result. I do not expect that Santander is relying on that though.

I think the opposite.  An Ombudsman is not going to be deterred by a bank's threat to close someone's account if the Ombudsman makes a determination the bank doesn't like.

I'm starting to wonder if people are forgetting that banking is regulated, and there are consequences for financial service providers if they break the rules.

For example, if a bank decided it was appropriate to use account closure as a 'punishment' for someone sucessfully complaining to FOS.  Do people really believe that would be Ok, and accepted by FOS and/or the FCA as reasonable conduct?

No threat is needed. The FOS is aware of the rules:

"Businesses that provide bank accounts are generally entitled to close them – just as their customers are. But you should treat your customers fairly. You shouldn’t close an account because of unfair bias or unlawful discrimination. And you shouldn’t usually close an account without giving reasonable notice."

https://www.financial-ombudsman.org.uk/businesses/complaints-deal/banking-and-payments/bank-account-closures

A closed account is free. Closing a bank account does not violate the original "free forever" marketing claim. That claim does not appear to be relevant anyway. It seems that the FOS will have to make its determination on the basis of the current T&Cs.

So would closing an account because an Ombudsman has determined it should continue to be provided free of charge (in accordance with a promise made by the bank) be considered 'fair'?  That is the fundamental question here.

A bank can close accounts because it no longer considers them be commercially worthwhile. That is considered to be fair (provided that the bank gives the required notice of closure).

In which case, is there any reason why Santander didn't just write to everyone telling them that their free business banking accounts would be closed? Instead of trying to add the charges?

Clearly this would have caused the same level of uproar from existing customers, but would have seemed less contrived and calculated than the way they are going about things now.

GeoffTF

clairec666 said:

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

Again, if an Ombudsman directed Santander not to impose charges having promised to provide a 'free forever' business account, and Santander's response was to close the accounts instead, then I'd expect FOS to take a very dim view of that and it probably wouldn't be the end of the story.

This is hypothetical upon hypothetical. I think the point is that the Ombudsman might be deterred from making such a ruling if he thought that the customer's account might be closed as a result. I do not expect that Santander is relying on that though.

I think the opposite.  An Ombudsman is not going to be deterred by a bank's threat to close someone's account if the Ombudsman makes a determination the bank doesn't like.

I'm starting to wonder if people are forgetting that banking is regulated, and there are consequences for financial service providers if they break the rules.

For example, if a bank decided it was appropriate to use account closure as a 'punishment' for someone sucessfully complaining to FOS.  Do people really believe that would be Ok, and accepted by FOS and/or the FCA as reasonable conduct?

No threat is needed. The FOS is aware of the rules:

"Businesses that provide bank accounts are generally entitled to close them – just as their customers are. But you should treat your customers fairly. You shouldn’t close an account because of unfair bias or unlawful discrimination. And you shouldn’t usually close an account without giving reasonable notice."

https://www.financial-ombudsman.org.uk/businesses/complaints-deal/banking-and-payments/bank-account-closures

A closed account is free. Closing a bank account does not violate the original "free forever" marketing claim. That claim does not appear to be relevant anyway. It seems that the FOS will have to make its determination on the basis of the current T&Cs.

So would closing an account because an Ombudsman has determined it should continue to be provided free of charge (in accordance with a promise made by the bank) be considered 'fair'?  That is the fundamental question here.

A bank can close accounts because it no longer considers them be commercially worthwhile. That is considered to be fair (provided that the bank gives the required notice of closure).

In which case, is there any reason why Santander didn't just write to everyone telling them that their free business banking accounts would be closed? Instead of trying to add the charges?

Santander will want to retain customers paying the monthly fee. They seem to believe that they are on firm ground introducing the monthly fee, and the the FOS will find in their favour. I have not suggested that Santander is planning to close accounts if the FOS finds against them, just that it is a possibility that the FOS might take into account.

clairec666

GeoffTF said:

clairec666 said:

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

Again, if an Ombudsman directed Santander not to impose charges having promised to provide a 'free forever' business account, and Santander's response was to close the accounts instead, then I'd expect FOS to take a very dim view of that and it probably wouldn't be the end of the story.

This is hypothetical upon hypothetical. I think the point is that the Ombudsman might be deterred from making such a ruling if he thought that the customer's account might be closed as a result. I do not expect that Santander is relying on that though.

I think the opposite.  An Ombudsman is not going to be deterred by a bank's threat to close someone's account if the Ombudsman makes a determination the bank doesn't like.

I'm starting to wonder if people are forgetting that banking is regulated, and there are consequences for financial service providers if they break the rules.

For example, if a bank decided it was appropriate to use account closure as a 'punishment' for someone sucessfully complaining to FOS.  Do people really believe that would be Ok, and accepted by FOS and/or the FCA as reasonable conduct?

No threat is needed. The FOS is aware of the rules:

"Businesses that provide bank accounts are generally entitled to close them – just as their customers are. But you should treat your customers fairly. You shouldn’t close an account because of unfair bias or unlawful discrimination. And you shouldn’t usually close an account without giving reasonable notice."

https://www.financial-ombudsman.org.uk/businesses/complaints-deal/banking-and-payments/bank-account-closures

A closed account is free. Closing a bank account does not violate the original "free forever" marketing claim. That claim does not appear to be relevant anyway. It seems that the FOS will have to make its determination on the basis of the current T&Cs.

So would closing an account because an Ombudsman has determined it should continue to be provided free of charge (in accordance with a promise made by the bank) be considered 'fair'?  That is the fundamental question here.

A bank can close accounts because it no longer considers them be commercially worthwhile. That is considered to be fair (provided that the bank gives the required notice of closure).

In which case, is there any reason why Santander didn't just write to everyone telling them that their free business banking accounts would be closed? Instead of trying to add the charges?

Santander will want to retain customers paying the monthly fee. They seem to believe that they are on firm ground introducing the monthly fee, and the the FOS will find in their favour. I have not suggested that Santander is planning to close accounts if the FOS finds against them, just that it is a possibility that the FOS might take into account.

Good point, seems obvious now.

I think that Santander have planned this very cleverly after having to back down in 2012 and it remains to be seen whether their sneaky T&C changes in 2015 will let them get away with it.

I think we all agree that they're morally in the wrong, unfortunately that doesn't mean the FOS will rule against them.

GeoffTF

eskbanker said:

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

Again, if an Ombudsman directed Santander not to impose charges having promised to provide a 'free forever' business account, and Santander's response was to close the accounts instead, then I'd expect FOS to take a very dim view of that and it probably wouldn't be the end of the story.

This is hypothetical upon hypothetical. I think the point is that the Ombudsman might be deterred from making such a ruling if he thought that the customer's account might be closed as a result. I do not expect that Santander is relying on that though.

I think the opposite.  An Ombudsman is not going to be deterred by a bank's threat to close someone's account if the Ombudsman makes a determination the bank doesn't like.

I'm starting to wonder if people are forgetting that banking is regulated, and there are consequences for financial service providers if they break the rules.

For example, if a bank decided it was appropriate to use account closure as a 'punishment' for someone sucessfully complaining to FOS.  Do people really believe that would be Ok, and accepted by FOS and/or the FCA as reasonable conduct?

No threat is needed. The FOS is aware of the rules:

"Businesses that provide bank accounts are generally entitled to close them – just as their customers are. But you should treat your customers fairly. You shouldn’t close an account because of unfair bias or unlawful discrimination. And you shouldn’t usually close an account without giving reasonable notice."

https://www.financial-ombudsman.org.uk/businesses/complaints-deal/banking-and-payments/bank-account-closures

A closed account is free. Closing a bank account does not violate the original "free forever" marketing claim. That claim does not appear to be relevant anyway. It seems that the FOS will have to make its determination on the basis of the current T&Cs.

So would closing an account because an Ombudsman has determined it should continue to be provided free of charge (in accordance with a promise made by the bank) be considered 'fair'?  That is the fundamental question here.

A bank can close accounts because it no longer considers them be commercially worthwhile. That is considered to be fair (provided that the bank gives the required notice of closure).

I think there may be some cross purposes at play here, but my view is:

Closing all accounts of a particular type, because of product withdrawal, is valid (although may not be seen as fair if breaching prior commitments, the acid test here).

Closing an individual account for a valid reason is indeed considered fair.

Closing an individual account because the holder complained successfully to FOS is highly unlikely to be considered fair.

Closing a selection of accounts on the basis of each holder having complained successfully to FOS is just asking for regulatory trouble!

In other words, 'fairness' is a concept that encompasses two related but different meanings, i.e. compliance with prior commitments is one thing but even-handedness (across customers) is a separate issue referred to by the same word.

I accept your point about not discriminating between customers.

More generally, if a business is no longer worthwhile as a result of regulatory action, I believe that it is reasonable for the owner to close that business down.

As far as prior commitments are concerned, was there ever a commitment to keep the "free forever" accounts open forever (which would be impossible), or just a commitment never to charge for them? If there was a commitment to keep the accounts open forever (whatever that means), does it still apply after the 2015 changes? If so, is it enforceable, or is there an overriding right to close the accounts down?

amyfairweather

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

Again, if an Ombudsman directed Santander not to impose charges having promised to provide a 'free forever' business account, and Santander's response was to close the accounts instead, then I'd expect FOS to take a very dim view of that and it probably wouldn't be the end of the story.

This is hypothetical upon hypothetical. I think the point is that the Ombudsman might be deterred from making such a ruling if he thought that the customer's account might be closed as a result. I do not expect that Santander is relying on that though.

I think the opposite.  An Ombudsman is not going to be deterred by a bank's threat to close someone's account if the Ombudsman makes a determination the bank doesn't like.

I'm starting to wonder if people are forgetting that banking is regulated, and there are consequences for financial service providers if they break the rules.

For example, if a bank decided it was appropriate to use account closure as a 'punishment' for someone sucessfully complaining to FOS.  Do people really believe that would be Ok, and accepted by FOS and/or the FCA as reasonable conduct?

No threat is needed. The FOS is aware of the rules:

"Businesses that provide bank accounts are generally entitled to close them – just as their customers are. But you should treat your customers fairly. You shouldn’t close an account because of unfair bias or unlawful discrimination. And you shouldn’t usually close an account without giving reasonable notice."

https://www.financial-ombudsman.org.uk/businesses/complaints-deal/banking-and-payments/bank-account-closures

A closed account is free. Closing a bank account does not violate the original "free forever" marketing claim. That claim does not appear to be relevant anyway. It seems that the FOS will have to make its determination on the basis of the current T&Cs.

So would closing an account because an Ombudsman has determined it should continue to be provided free of charge (in accordance with a promise made by the bank) be considered 'fair'?  That is the fundamental question here.

A bank can close accounts because it no longer considers them be commercially worthwhile. That is considered to be fair (provided that the bank gives the required notice of closure).

Not these "free forever" accounts, they can't.

Santander could, of course, exit the business banking landscape for commercial reasons - that would be fair enough.  There could then be no complaints as the service is no longer offered.

However, if Santander were ever to return and start business banking again, then surely these 'free forever' accounts must also return because (drum roll), they said no ifs, no buts, free forever business banking.

They're either offering business banking or they're not and, if they are, then these accounts have that promise attached.  Santander cannot have their cake and eat it.

solidpro

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

GeoffTF said:

Section62 said:

Again, if an Ombudsman directed Santander not to impose charges having promised to provide a 'free forever' business account, and Santander's response was to close the accounts instead, then I'd expect FOS to take a very dim view of that and it probably wouldn't be the end of the story.

This is hypothetical upon hypothetical. I think the point is that the Ombudsman might be deterred from making such a ruling if he thought that the customer's account might be closed as a result. I do not expect that Santander is relying on that though.

I think the opposite.  An Ombudsman is not going to be deterred by a bank's threat to close someone's account if the Ombudsman makes a determination the bank doesn't like.

I'm starting to wonder if people are forgetting that banking is regulated, and there are consequences for financial service providers if they break the rules.

For example, if a bank decided it was appropriate to use account closure as a 'punishment' for someone sucessfully complaining to FOS.  Do people really believe that would be Ok, and accepted by FOS and/or the FCA as reasonable conduct?

No threat is needed. The FOS is aware of the rules:

"Businesses that provide bank accounts are generally entitled to close them – just as their customers are. But you should treat your customers fairly. You shouldn’t close an account because of unfair bias or unlawful discrimination. And you shouldn’t usually close an account without giving reasonable notice."

https://www.financial-ombudsman.org.uk/businesses/complaints-deal/banking-and-payments/bank-account-closures

A closed account is free. Closing a bank account does not violate the original "free forever" marketing claim. That claim does not appear to be relevant anyway. It seems that the FOS will have to make its determination on the basis of the current T&Cs.

So would closing an account because an Ombudsman has determined it should continue to be provided free of charge (in accordance with a promise made by the bank) be considered 'fair'?  That is the fundamental question here.

A bank can close accounts because it no longer considers them be commercially worthwhile. That is considered to be fair (provided that the bank gives the required notice of closure).

Except when the contract was forever.

solidpro

amyfairweather said:

Santander could, of course, exit the business banking landscape for commercial reasons - that would be fair enough.  There could then be no complaints as the service is no longer offered.

However, if Santander were ever to return and start business banking again, then surely these 'free forever' accounts must also return because (drum roll), they said no ifs, no buts, free forever business banking.

They're either offering business banking or they're not and, if they are, then these accounts have that promise attached.  Santander cannot have their cake and eat it.

Their dumb argument is they don't offer this type of account anymore. Not business accounts but business accounts which are free forever. 

A sweet shop that says they don't sell cola cubes as a type of sweet anymore cannot keep selling cola cubes on the basis that they're more expensive cola cubes. It's the same type of sweet regardless of price.

Maybe another example of really bad regulation is letting water companies say they don't put that 'type' of disgusting pollution in our rivers meaning toxic waste whilst they continue to pump disgusting harmful amounts of raw sewage in. It's the same outcome - bad stuff happening, not meeting moral obligations....

sdd56

I'm confused.

I made a formal complaint by phone to Santander in July, and was given a reference number.

After 8 weeks, with no response, I made a complaint to the FOS last week, using their online form. I explained clearly that I had complained to Santander, had no response within the 8 weeks, and provided FOS with the date and reference number.

I have now received a reply from the FOS, which although it gives me a case number, appears to suggest they will not be taking it further at this stage, as I need to first complain to Santander and give them time to respond (which I have already done).

"Thanks for getting in touch with the Financial Ombudsman Service. We’ve set up a case for you – the reference number is XXXXXXX. Please use this number whenever you contact us. 

Firstly, I’d like to take this opportunity to say I’m sorry to hear about the difficult time you’ve gone through regarding this complaint.

Before we can get involved, Santander needs a chance to give you an answer on your complaint.

We can only look into complaints where you've received a final response letter from the business you're complaining about, or where the business hasn't responded within our time limits. If you submit a complaint to us before this, we won't be able to get involved and it will take us a lot longer to progress your complaint.

What you'll need to do

You should complain directly to Santander, explaining what the problem is, and how you'd like them to put things right.

If you’ve already complained to Santander, in most cases they have up to eight weeks, to look into your complaint and issue their final response, depending on what you're complaining about. You should keep a record of when you complain to them, and any other correspondence or conversations.

In the meantime, you can find out more about how to complain on our website.

When you've heard back from the business – or eight weeks have passed from the date you first complained – if you remain unhappy, get back in touch using our online form or call us on 0800 023 4567 and we'll let you know how we can help.

If you decide to use our online form, please also quote the above reference number in the section of the form ‘Tell us about your complaint – what happened?’. This will help us find your complaint and prevent delays.

We won’t take the complaint any further at this stage."

Has anybody else had a similar response from FOS?