Credit card seized because balance transferred

phoebemum

Taking advantage of an offer by Virgin of only a 0.5% charge for transferring an outstanding balance on Intelligence Finance card, my husband transferred the funds. Today he went to use his Intelligence Finance card and was told that a freeze had been put on the card and that the card had to be seized - as a serving police officer this was more than a little embarrassing.

He rang Intelligence Finance to query what was happening and was told that it was to prevent fraud and that as a large payment had been made to his card (which was now £52 in credit) they had to freeze it and it would be up to my husband to prove how that money had been paid. He explained that it was a balance transfer from another card - which they would be able to see as the money had come from Virgin.

We can't believe that Intelligence Finance are able to do this - they are effectively holding his money and won't release it all because he paid off his balance! Has anyone else experienced similar?

RTNI

Hmm. That's interesting, IF are basically saying that they suspect him of money laundering (or such like) then due to the large payment.

Was the BT payment from virgin a very large amount? If it was out of "character" for the account, then it is possible that they became suspicious and did what they did.

To answer your question, yes they can do it, but as you have said it is quite frustrating. Your other half will need to do as IF say and prove where the money came from.

Bokkens

Naar
Don't be soft soaped,I regularly move £0000's around and although there are money laundering checks against my credit file I have never had a problem or and letters etc about my money movements.It sounds like someone at IF has been over zealous and I for one would want my money back asap plus a compensationary amount for the hassle say £30 or more for lost interest phone calls day off work to sort it out call it a round £100.The more they delay tell them the cost goes up ask to be refered to a manager for a decision and mention the banking Ombudsman and the banking code for added effect of course if they do delay just refer it to the banking Ombudsman for action.Be very polite and ask for peoples names and job title whom you speak to and write everything down or tape it for future reference.

phoebemum

thank you, bokkens, I like your thinking and will give that a go! It wasn't a huge amount (around £9k) and certainly we've moved similar amounts around before - and I'd have thought most cards would be used to such transactions happening. IN fact, if my memory is correct, when we first took out the IF card a few years ago we transferred an outstanding balance from another card to it - and they didn't seem to mind then!!!

YorkshireBoy

The reason for the problem is IF's (or rather Halifax's) condition 7.6 which states...

7.6 You must not make payments or transfer funds from another credit or store card to your account that would leave a credit balance on your account. We may return any funds that exceed the balance owing on your account to the account from which the money has been sent.

So, perhaps best to play by their rules, apologise, and hopefully you'll get a quicker resolution than going in all guns blazing...because it would seem they could just bounce the payment back to Virgin.

This will have two outcomes...you've possibly paid Virgin a BT fee for nothing, and your IF balance becomes interest bearing again. And you wouldn't want either to happen, would you?

Bokkens

Yorkshireboy is correct and this applies to most if not all credit cards you have to have a debt to BT except where you BT direct into a Bank account from a credit card.Watch out for BT fees if you try to move the balance around to another account as this will eat into your profits if you intended to stooze the funds.

phoebemum

never even seen that rule before! the balance transfer, however, wasn't the payment that took it into credit - the BT was less than the outstanding amount but there was a payment set up with current account to pay the usual monthly bill (which we tried to cancel but were too late to do so), so that is what took it over. We have, therefore, still abided by the 'rules'.

Also - the IF person on the phone made no reference at all to this rule (so, again, suspect that this is not the case in this situation) but rather said that it was to prevent fraud and that OH had to prove where he got the money from. This gives no indication that the money is to be returned or that it has anything to do with the account going into credit. He refused to discuss it any further with my OH or to let him speak to anyone else.

sure don't see us apologizing to them anytime soon!!

YorkshireBoy

The fact is that this piece of information (which wasn't included in your OP)...

phoebemum wrote: »

the balance transfer, however, wasn't the payment that took it into credit - the BT was less than the outstanding amount but there was a payment set up with current account to pay the usual monthly bill (which we tried to cancel but were too late to do so), so that is what took it over.

...doesn't change the position. See below.

We have, therefore, still abided by the 'rules'.

You have not abided by the rules at all. You have either made or initiated a payment (whichever one it was is irrelevant) that has resulted in a positive balance on your account. It is this outcome that has sparked HBoS's AML team into action.

The only transaction type that is allowed to create a positive balance is a purchase refund...which is clearly identifiable to HBoS by it's accompanying 'merchant code'

He refused to discuss it any further with my OH or to let him speak to anyone else.

That's more than likely because there is an AML note on your file saying "AML team investigating - do not discuss with customer".

sure don't see us apologizing to them anytime soon!!

Have it your own way, but I'm sure my way will deliver a faster resolution, and be a whole lot less stressful.

Good luck with it.

peawack

So why can't Halifax return the monthly payment he made to take the balance into credit ?

phoebemum

reasons are now cleared up - and it was nothing to do with paying over the outstanding balance.

Received a letter today dated 28 Jan (ie, before the account would have gone into credit) saying the account had been terminated because payments had not been made in accordance with the monthly statements and the account must be maintained within the agreed credit limit. They asked for proposals for repayment of the outstanding balance and return of the card. Included the threat about registering the debt with credit reference agencies if we didn't contact them within 7 days. An hour of worry until their phone line opened as the letter was implying that we'd gone over our credit limit!

Rang up and spoke to a very helpful lady, who said that there was suspicion that my husband's account had intercepted a BACS payment meant for another account - ie, mine. He explained that the payment was a balance transfer to an account held in my name, on which he is a secondary card holder. She said that was fine and that she'd take the suspension off the card!!! easy as that. OH explained that the complete unhelpfulness of the person the day before who had not tried in any way to explain why the account was suspended meant that he no longer wanted to keep the account and could it be closed. She agreed to close it and send out the cheque to him. He asked if he still needed to send in the proof - no, he didn't. If the person yesterday had done that the whole thing could have been sorted in less than 3 minutes!!! Instead we'll never be doing business with either IF or Halifax ever again.

Thanks again to everyone for their comments (I now know a few extra things about credit cards that I never knew before!!).

Bokkens

I am glad it is all sorted ,sorry for confusing things at the start of the post.