Questions of Cash: When banks fail you: The Independent

Questions of cash: When customer care is not up to scratch



by Paul Gosling
Saturday, 28 June 2008

Q. I bought a car in March for £20,000, and the dealer suggested I pay using my debit card. I phoned my bank, Alliance & Leicester, warning it of the transaction. I had to answer a lengthy set of questions to ensure the transaction was accepted. But a week after the transaction, I found that my current account was nearly £19,000 overdrawn, even though I have a £1,000 overdraft limit. A&L had processed a second debit card transaction three days after the first. It had not warned me, or sought approval of the second transaction. A day later, a week after the £20,000 had gone out of my account, I received a letter asking me to contact the bank. A&L then told me it was my fault. I had to transfer £19,000 from savings to keep the direct debits going. A&L charged me £30 overdraft fees, and after 60 days I have not had a reply to my letter of complaint. KC, Budleigh Salterton.



A. A&L says the error was made by the car dealership, which unintentionally processed the transaction twice. A&L confirms that while the first transaction had been authorised, the second one was not. However, its spokesman says: “Unlike other transactions, such as direct debits or cheques, card transactions cannot be cancelled.” But transactions can be challenged, though in this instance you did this yourself by contacting the dealership – which immediately credited the second payment. The bank’s spokesman adds: “Alliance & Leicester therefore cannot be held responsible for the double debit and have acted correctly in accordance with other card issuers and in line with Visa regulations.” A&L does accept “that there have been delays in our response” in advising you about the situation and it apologises for this. It also apologises for any inference in your phone conversation that the problem was caused by you and for failing to return your call as it promised to do. “It is clear that the level of service which you received has fallen well below the standard that you have every right to expect,” concedes the bank. It is crediting your account with £9.89 to cover the interest you lost by transferring money out of your savings account; £30 to repay the unauthorised overdraft charge; and a further £100 as a goodwill gesture.


Q. My husband has been trying to open a Direct ISA Issue 4 account with Alliance & Leicester since the beginning of the financial year. Initially, he was told he needed to submit documents for confirmation of identity: these were sent on 15 April. After a further two calls, I was told they had gone astray and I resent the copies on 8 May. I heard nothing more, so on 29 May I phoned again and was told that the documents had been received and the account would be opened ‘at any time’. We have heard nothing since. CG, Cambridge.


A. The proof of identity information was received by A&L on 29 April, but because of the high volume of applications, it was not examined until 31 May. At this point it was found that the documentation had not been certified, as is required. A&L apologises for the delay, but says it could not process the application until the required documentation was provided. It has sent you £50 as a goodwill gesture. It will also backdate the interest until 21 April, a week after you say you sent the documents into A&L.


Q. Abbey has blocked my credit card for no reason that I am aware of. It says I owe £3,361 on the card, but I don’t owe a penny. I pointed this out on 10 April, but have heard nothing since. ER, by email.


A. Your card details were used to conduct a fraudulent transaction. But Abbey accepts that it failed to handle your problem properly and that its branch staff did not escalate your complaint as they should have done. The account balance has been cleared, your credit file corrected and you have been sent a gift hamper as a goodwill gesture.


Q. I have a current account with Nationwide. On 22 May I withdrew a thousand pounds from the account without a problem. The next day I went to the same branch to withdraw a similar amount and was told the maximum I could withdraw was £500. I complained and was told that there was a cash shortage in the branch and I had to go to another branch to get my money. Can it refuse a request in this way? ZH, Birmingham.


A. Quite simply, if the branch does not have the money on the premises a customer cannot have it. A spokesman for Nationwide explains: “The society allows withdrawals of up to £2,000 per day for customers with a debit card FlexAccount, subject to funds being available in the branch. For security reasons, we keep a limited amount of cash in our branches and on rare occasions it may become necessary to limit the maximum withdrawal amount.” The spokesman adds that this is clearly stated in the society’s terms and conditions. Nationwide suggests that customers provide 72 hours advance notice if they wish to make large withdrawals.


Q. You previously answered my question about the capital gains tax implications of me taking over my daughter’s boyfriend’s share of the mortgage responsibilities of her house (Questions of Cash, 24 May). This was after Nationwide refused to accept a guarantee from me of the mortgage. It would make it easier if I could guarantee the mortgage – can you find out why Nationwide will not allow me to do this? JM Lincoln.


A. All Nationwide guarantor mortgages are subject to a maximum loan to the value of 85 per cent. In the case of your daughter’s home, the loan requested was 89 per cent. Nationwide tells us that you have agreed to its offer of a joint mortgage with your daughter.

Questions of Cash cannot give individual advice. Please do not send original documents. Write to: Questions of Cash, The Independent, 191 Marsh Wall, London E14 9RS;

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