Cancelled direct debit, was still charged!!

corinne362

Hi I would really appreciate someones help on this as it has upset me a great deal.

I am a new customer to Natwest Bank, I recently cancelled a direct debit of mine for insurance as I had taken out a new policy (actually it was 2 direct debits as one was for me and one for my husband) I cancelled the direct debit with my bank through online banking 2 weeks prior to the payment date.
I didn't contact the insurance company, I know your supposed to but in the past I never have and they have normally then wrote to me to say your bank has informed us u have cancelled the direct debit if you no longer require the policy we will give 2 weeks for payment or the policy will be cancelled (or words to that effect).

But the insurance company tried to take the payment and I didn't have the money in my account anyway (which i didn't think would matter as I had cancelled the direct debit with the bank) but the bank have charged me £76 for unpaid direct debit!!! how can I be charged if I cancelled them I spoke to the bank and was told that I should have cancelled with the company as well as far as they were concerened I could have reinstated the direct debit with the company! I have checked the direct debit gurantee which states I have the right to cancel the direct debit any time I wish and my bank (natwest) should not have attempted to make the payment after I had cancelled it, (regardless of if I cancelled with the company or not), Is there anything I can do about this the bank won't listen to me and stand by their decision, but I never had this problem with my previous bank I cancelled direct debits all the time if i knew i wouldn't have the funds there with no charges! Any advise on what to do next would be greatly appreciated, thank you.

nickmack

corinne362 wrote: »

But the insurance company tried to take the payment and I didn't have the money in my account anyway (which i didn't think would matter as I had cancelled the direct debit with the bank) but the bank have charged me £76 for unpaid direct debit!!! how can I be charged if I cancelled them I spoke to the bank and was told that I should have cancelled with the company as well as far as they were concerened I could have reinstated the direct debit with the company! I have checked the direct debit gurantee which states I have the right to cancel the direct debit any time I wish and my bank (natwest) should not have attempted to make the payment after I had cancelled it, (regardless of if I cancelled with the company or not

Did they attempt to take the money using the same Direct Debit reference as the one you cancelled?

dzug

Sorry, other than appealing to the bank again, no. The mistake is at least as much yours (failing to tell the insurance company, and assuming every bank works in exactly the same way) as theirs. As they say you could have reinstated the mandate - and the insurance company could as well (some submit it afresh each month rather than lodging it with the bank).

And as (presumably) you didn't cancel the policy with the insurance company you have broken your contract with them and probably owe them the money anyway.

Once the court case is settled, you may have the 'unreasonable charges' avenue to pursue.

corinne362

I don't owe the insurance company any money thats how insurance works I stop the payment the cover stops.

surely it is not right that if I cancel a direct debit with my bank they should still go ahead and attempt to pay it any way!

what is the point in having the option of cancelling direct debits with your bank if it is the company u have to cancel them with????

esuhl

Sorry, but I disagree with dzug - this has nothing to do with the "unreasonable charges" cases. You have no charge to pay because the bank acted against your wishes. The Direct Debit Guarantee requires the bank to refund you in full, including the penalty charges.

My bank (also NatWest) did this to me once and tried to say that there was nothing they could do as the money had been paid, but I pointed out that the fact that they chose to pay has nothing to do with me and they gave me a full refund.

To quote the Direct Debit Guarantee: "If an error is made by the organisation or your bank or building society, you are guaranteed a full and immediate refund from your branch of the amount paid" (see http://www.financial-ombudsman.org.uk/publications/ombudsman-news/27/27-directdebit-guarantee.htm)

I would ask (nay, insist) that the bank return your money. If they attempt to delay you or fob you off, report them to the Financial Services Ombudsman:
http://www.financial-ombudsman.org.uk/consumer/complaints.htm

Good luck...

esuhl

Oh, I should also say that whether or not you owe any money to the insurer depends on the terms of your policy. Assuming that their terms state that cancelling a direct debit will cause the insurance policy to lapse and no further charge will be applied, then you won't owe them anything, but it might be worth checking the wording if you are at all unsure.