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The banks lost our trust – but can they win it back?

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Our executive director, Richard Lloyd, appeared on BBC 5 Live on Monday to discuss the future of banking with a panel of experts. As trust and culture topped the agenda, aren’t we overdue a big change in banking?

British banking culture is under more scrutiny than ever. As staff incentives have focused on sales for too long, the ‘sales first’ culture has leaked from top executives right down to front-line bank staff. Richard Lloyd added this morning that the culture of banking will only change when customers are put before sales.

Philip in Nottingham called in to BBC 5 Live and told the panel:

‘They need a good spanking all these bankers. We need to tell them there are new terms and conditions – take it or leave it. And we, the public, should run the renumeration committees responsible.’

Bank service versus sales

Mark, a Natwest employee, texted the show to say:

‘I worked for NatWest for almost 20 years. Until banks return to a service-based outlook as opposed to an aggressive sales culture, bad behaviours will continue. Sales sales sales, sorry, ‘meeting customers’ needs’ – is the underlying problem in branch banking.’

A listener named Jan also rang the panel to share her view on one way to change banking culture:

‘There are not enough women in banking, and certainly not at the top levels – I believe there’s not a single global bank that’s run by a woman. Clearly the culture which runs through an organisation is determined by the people who run it, and a little less testosterone and a little more conversation might help.’

Have banks been trading on our trust?

So consumers’ trust in banks has been seriously shaken. Greg Clark, financial secretary to the Treasury, made a point that people trust their banks to act in their best interests. But he added that, , that trust has been abused. In our recent research, we found that over two-thirds of people don’t trust bankers – leaving them less trusted than estate agents and lawyers.

To highlight the problem, one consumer texted the show to talk about the PPI mis-selling scandal:

‘This was not perpetrated by a tiny number of bankers… this was the whole of the banking profession, from directors to clerks.’

One tweeter contacted us to talk about his lack of confidence in bankers’ training:

‘My 24yr niece. No academic qualification to her name, earns enough at [Big Bank] to run new Range Rover and has a penchant for spending! It beggars belief and makes a mockery of having need for academic qualifications.’

When Ross McEwan, head of retail banking for NatWest and RBS, suggested that consumers lacked confidence to borrow, one tweeter said:

‘Lack of confidence’ – not surprising. RBS et al wiped all possibility of financial confidence from UK’.

Can switching make a difference?

It’s often suggested that people should switch their banks if they are dissatisfied with their service. But our research found that UK consumers are more likely to get a divorce than they are to switch their bank accounts. One caller to BBC 5 Live explained their reason why:

‘You say ‘why don’t you move banks?’ It’s because they’re all the same.’

While another tweeter made us laugh by suggesting:

‘Could banks not attract customers by combining both in special offers? #Divorce #SwapBanks’

If you want to find out some of the suggestions the panel made for improving banking in the future, you can tune in to replay the show. Our Big Change campaign is working hard to try and fix some of these issues, but in the meantime, how do you think we can change banking culture in Britain?

Stephen Rosling says:
13 November 2012

I think Lloyds and the Coop are already making changes to their incentive schemes. I noticed this a few months ago shortly after I received a redundancy payment into my account, i.e. no-one has been in touch with me, even though I would have welcomed a discussion!

As someone who has worked in financial services for over 25 years and for the last few years has been deeply involved in the FSA’s TCF initaitive, they key issue is that customer risks and issues aren’t treated with the same priority when compared to other issues – shareholder priorities, sales volumes, profit margins etc. Yes, there has been a focus on customer satisfaction, but this is different to fair treatment.

For the culture to change, there needs to be a new and sustained set of behaviours from the top of the organisation. It seems that many organisations treated TCF as a project, i.e. with an end date and then delegated it to others. Rather than “numbers” people being at the top, how about people who have a genuine interest and desire to do what’s best for their customers, (not the shareholders.) “Fairness” also needs to be part of the recruitment and selection process.

Despairing at the pathetic service and rip off culture of the big banks I turned to the Co-op Bank in the hope of something better.
So much for ethics, they are the same or worse than the others. Getting money back from them(on maturity of a fixed deposit) has been a nightmare.I am now fighting for interest for the time they enjoyed my funds free of charge.
When I worked in banking it was against the rules to allow deposits to mature on non-banking days eg the weekend. The Co-op seems to think it is tough luck on the customer if they can’t get their cash back nor receive interest for the weekend.

Dawn Richardson says:
22 November 2012

Its not just the Banking System that is untrustworthy it is Society itself.. Government promises which Fail and Let us down Continually always about Money… The UK is money driven and this country is all Spent out due to Toxic Debt and Greed..
What a future for our children?…I forsee there will be struggles, poor compliance and Lawsuits..
Corrupt practices is the name of the Game today..
FSA is useless and need to play by the rules..What chance has the individual got in this country today. None!. Unless you have Money you are on the treadmill for the rest of your days..

Deregulation has a lot to answer for allowing the banks to defraud us colluded to by the Government .At the moment I am watching Santander represent large cheques it has not paid out on when told by me would represent correct one . They have been using automatic robots to tell you being defrauded calling their number which the banks say never do .I am on telephone preference service too. Then they say would never call you personally??!! While they are refusing access they are becoming richer by £1000+. Do they think we are stupid ? And pretending we haven’;’t noticed.? This is what happens when control is given to dubious accountants.

Dawn Richardson says:
5 December 2012

Control is the Operative word! …you have hit the NAIL ON THE HEAD our money is not our own.. The FSA have failed us the public in many ways in order to protectour interests legaly with Financial Institutions that is what they are there for! I am one of them who was with KSFIOM BACK IN 2008 involving the Kaupthing Bank situation..domicled in the UK they were questioned and got away with it..

William France says:
5 December 2012

I live in France and I have been watching the banking scandal in the UK unfolding with alarm but without surprise.

I was in the UK when the Government relaxed the rules on the banks. At college I was told on a liberal studies course, that the amount of money a bank could safely lend was roughly ten times the value of its liquid assets. I assumed that this was one of those natural laws that anyone in a position of trust would follow rigorously. It was pointed out that the UK banks (this was in the 1960s) had always stuck to this rule and had survived safely through the depression of the 1930s. The US banks on the other hand had overlooked this rule and lent money to fools betting on the US stock exchange. Their banks collapsed.

Starting in the 1980s with internationalism, the British banks eyed with envy the prophets being made by the US banks who had not learned their lesson in 1929. Everyone thought that they were protected by computers; What could go wrong? The Property market was proving to be as lucrative as that promised by the South Sea Bubble. It appears that greed has prevented the banks from learning the lessons from History.

Banks should return to looking after money, not making it. Of course they should make profits and of course the employees should be well paid for doing so. However, nobody should be paid a bonus for doing their job for which they are well paid. That is what they are paid for. Suggesting that they need a bonus to work properly is tantamount to saying that they can’t be trusted to work properly. Who wants people working in a bank that can’t be trusted?
No wonder the banking system is sick.

Dawn Richardson says:
5 December 2012

Absolutely William
My impression is that the Bankers think they are “Little tin Gods” and have a power over people because the country is in Debt, people are in genuine need in these times of austerity.
Maladministration by the FSA, Faults and Greed in the Banking industry due to a lack of control during the profit years.

Admittedly I made a profit from my properties at the right times however.
Only to be parted from it when Kaupthing Singer an Friedlander went down and into Liquidation. They were advertised as being Solvant at the time as AAA but lied and knew they were in Meltdown, many people suffered in this cobweb of deciet… which I truely believe the British Treasury had some part in this debacle under Labour. also as regards KSFUK which went down as well..
So where is sthe TRUST?
Excessive charges is an issue as well the Banksjust jumped on the Band wagon a disgrace!.
As well as archaic Celtic Laws in the Isle of Man. ;(
Where was the FSA for its UK residents then? NO HELP whatsoever.

I retired from Natwest 11 years ago.The branch staff ,then,were under terrible pressure sell,sell,sell and the customer became secondary.NOTHING HAS CHANGED!!!!!!
Until we return to the days when customers used to enjoy going in to the Bank ie treated as a customer and not a potential sale will the banks remain in the big black hole they dug for themselves.

Dawn Richardson says:
7 December 2012

All about MONEY as it is in the Government Budget, Banks, NHS, I was a Nurse retired out @51 due to Stress overwork and a Chronic Industrial Injury caused in my Job

… MONEY Money Money..shame the client is not the center of this anylonger always a hidden agenda..

Richard says:
9 December 2012

There would have been little need for austerity if it had not been for the banks panicking, and being allowed to place companies into administration at the drop of a hat. After doing so, flooding the markets with the assets that they want turned back into cash, at whatever price they can achieve. Yet by them alone flooding the market in the first place, they have themselves lowered the demand and thereafter the sale price achievable.

We hear the same time and again, that the bank never carried out any due diligence, had little or no understanding of a business, allowed an inexperienced manager to make a decision, yet they were allowed by the courts to appoint administrators, and what then?

The majority of the time, if not all, the administrators have little or no interest, other than securing there fees first.

I have been in litigation with a well known high street bank for over four years, and never in my entire life have I known such deceit, it has been an almost impossible task to obtain disclosure of any sort, let alone disclosure of the true facts, even through the courts. If I had never experienced it I would not believe it.

For almost four years this well known high street bank has been in denial of the evidence in proof, that I had discovered and put to them, that being that they had created and circulated inaccurate information.

It was not until three years after I had provided the proof to them that they admitted to it, and it was only after being questioned by the local authorities that they did admit to it. Even then, they were still in denial of any damage caused, yet the company was long gone, liquidated by the administrators after they had absorbed most of what had been recovered during the administration, and still today and the saga continues.

I will continue in my endeavours, as I have almost night and day for the last four years, to bring this bank to write their wrong. The same wrong, their wrong, lead them to make allegation, wrongful, of fraud, forgery and deception, and to add to the misery and suffering the FSA, Ombudsman, HM Treasury, Prime Minister do not want to know, both the FSA and the Ombudsman say they cannot get involved because the company was a Limited company, and there will be tens, if not hundreds of thousands of business people tied up in litigation of one sort or another with either the banks, or administrators, or both, being bled dry of any worth they have left, be it mental, physical or monetary, and everybody wonders why the economy is in the mess it is.

There needs to be legislation put in place to stop the banks being able to place companies into administration as easy as they are / have been doing, and there needs to be some sort of legislation that ensures nothing less than absolute transparency from the banks, the government, and the governing bodies they put in place.

Until such time as this happens we will continue on a downwards spiral, it may improve in the short term, but it is inevitable, unless the changes are made, it will all fall down again.

Richard says:
9 December 2012

A hard lesson to learn and never any end in sight!.. It just appears that all the wrongs will never be put right and the ordinary man on the Street like you and I get ripped off!..The FSA are negligent well they were in my case got away with it!….sounds very similar to mine Richard..

These things are pre planned in all aspects of Banks going into liquidation, governments and politicians, doctors re healthcare watered down services, unfair treatment by DWP re ATOS government employees and the disabled…All rigged to avoid heavy rightful payments to real people who need it. Legislation means bugger all.. just a bit of paper that sounds Good!
I myself have been at the hands of two massive injustice’s under United Kingdom LAW .
Which turned my life on its head! Left me injured without fair payment and broke!
Government bureaucrats have ways with their departments that STOP any rightful claims and have a manipulative hold on us all..
So the only way to get an sort of help is to play them at their own Game..
Go underground..
Get Evidence get proof..
Sometimes difficult I know and goes against the grain in the way I was raised as an being honest.woman, but that is why I am suffering now because I was honest and they were NOT…a culture of Phone hacking bugging, and god know what else, in order for these people whom ever they are to get the Information they need ..
Corrupt Society in the UK these days its not going to get any better.

Sign Nothing keep your head down is what I advise to anyone. Keep all personal information to yourself..There is No freedom of Choice today..1984 Springs to mind..This exactly the way we are going… and I hate it!

Katie says:
9 December 2012

struggling to believe the ignorance of members of the British public – who is it you supposedly don’t trust – the cashier in the branch or the CEO setting the strategy?

No doubt you were happy to borrow too much, make a profit on your house using money they lent you, take profits in dividend or through your pensions, or to lend to your business when you needed it….

They trusted you….. Back off people!

Richard says:
9 December 2012


You are a long way of knowing even the half of it. Yes I allowed the company to borrow the money many millions, and provided personal guarantees for some of it, and then when the rains came, we were left without choice other than to initiate a disposal program of the top end assets at as good a value as we could achieve at that time, in the marketplace we were in, settling the short fall (if any) from cash reserves.

We had achieved 95% of what we set out to do and were on the final stretch, and within a couple of weeks, not longer than a month, we would have been back in a strong and stable position. BUT, the bank and its manager who we had only recently moved to, panicked after hearing inaccurate information which came from within the realms of another bank we were dealing with. But the manager never thought to ask us if what they had heard was accurate.

The other bank (mentioning no name at press) had created inaccurate information within a spreadsheet, circulated rumours on the back of it and later circulated the spreadsheet itself. Which I later (many months later) discovered.

After which, I made the same known to the bank, including to its CEO, and Executive Director who is now Head of Corporate, Commercial and Business Banking, and the response I received was one of denial, the same as it has been for almost three and half years. It is only recently that they have admitted it, but still they have the audacity to deny that any damage has been done as a result of it, as I stated in my earlier posting above, posted on the 9 December 2012 at 6:15am.

Katie says:
9 December 2012

This is just the sort of attitude we would expect from a Banker.. I worked hard for my Money and paid back debts!
All of the PROFIT was through sheer hard work over 15 years making Houses Fit to sell… we deserved a profit as we put much into the houses. We never ripped anyone off either with hyper inflated BANK charges either!! which to my mind
was “Day Light Robbery”
Law came down on the side of the people that time honey!…
Why would we trust a Cashier with an attitude like yours.. Your Service it appears would never be in the interest of the client would it? Clients who pay your wages without the borrowers or the savers you would be out of a JOB..

So how old are dear just left School I expect?

KarenA says:
13 February 2013

My bank recently refused to pay a standing order when the funds were available to pay it and charged me £10 for the priviledge. The standing order fell on a weekend so was due to be paid on the Monday. They looked at funds available on the Sunday and decided it wasn’t enough. They failed to take into account the fact that a standing order from another of my bank accounts at the same bank was due into the account on the same date that the standing order was due out. This standing order has funded the account for months and this problem never occurred previously. My bank failed to take into account that I am a good customer with a good credit record who had plenty of money in their bank.

Why didn’t they pay my standing order? Was it because they wouldn’t be able to charge overdraft fees because I wouldn’t go overdrawn? I worked in a bank for 7 years and we were very careful about returning or refusing cheques or payments as our customers’ reputations were on the line. It seems to me as though banks no longer care about their customers. Their complaints process was useless as well. They simply weren’t interested in the unfairness in their procedures or in their responsibilities to me as a customer. I also wrote to the CEO asking for an explanation but I didn’t receive a reply. Prior to this I thought I had a good relationship with my bank. But now I am totally disgusted with you Lloyds TSB.

Kaytee says:
13 February 2013

An interesting post KarenA however my immediate thought is that the requirement to pay the s/o is that the money is in the account ahead of the instruction being actioned – In other words if the money coming in gets there at 3pm, but the instruction to pay from your account is actioned at 2:50pm, then you didnt have the money in the account and they were correct to not pay it.

Writing to a CEO is IMHO pathetic behaviour especially as you seem to think you have a good understanding of how their systems work…… May I assure you, that you clearly dont and whether it was Lloyds, Barclays, HBOS, Santander or anyone else the automation that is required to reduce costs and give you free banking prevents people looking at the account to see that the money is due in later in the day, and thus authorising the payment.

KarenA says:
15 February 2013

Actually Kaytee, I spent 7 years working in a bank and I thought I had a good understanding of how these systems worked, but obviously that was in the days when standards were higher, customers were treated with more respect and the bank was concerned that it didn’t refuse payments unnecessarily. Yes of course the money needs to be there in the account and it was on the due date – I don’t specify the time that the bank processes it standing orders. Obviously this is an automated process – one that has never caused a problem before so it has obviously been changed – and it would be perfectly possible for the bank to automate the process so that standing orders coming in to the account (from the same bank) are taken into consideration before standing orders going out, which I imagine is how it must have been before they changed it. I also noticed that the standing order which I set up to go out on the 30th of the month, which I would expect to be due on the 1st March under the old, fair rules had a due date of 28th February. Thanks for your input but I think I understand perfectly!

Perhaps you could speak to your branch for an explanation. Might be worth changing your standing order to be in your account a day or two before the other needs to be paid – sounds a bit tight the way it is set up. Automation doesn’t initially think about good and bad customers.


Banks are businesses and there to make a profit. If you check their terms and conditions you will probably find that they have done nothing wrong – and you definitely will not find anything about special treatment for loyal customers. You could ask your branch why you have had a problem now, but not before.

I think you would be well advised to allow time for credits to be applied before using the money. Your bank should be able to advise.

Stephen Rosling says:
15 February 2013

Automation and efficiency are the holy grail for banks! KarenA’s situation is a perfect example of banks not treating customers fairly – think how many more customers in that branch, that bank, and other banks that will have been treated in the same way.

In general, if it is a case where an account does not have cleared funds available then a payment can’t be made without borrowing money from the bank – i.e. other savers or investors. If that borrowing is not authorised – by for example an overdraft arrangement – then the bank is potentially at risk. It is up to the individual, with the bank’s assistance if necessary, to ensure that the account is administered properly. We are responsible for operating our financial affairs correctly.
If the bank has been at fault, then it can either compensate the customer, or the customer can choose to move their account if they feel sufficiently aggrieved.
Not a comment on KarenA because that would be inapproriate.

Katie says:
16 February 2013

In response to StephenRosling’s comment

“Automation and efficiency are the holy grail for banks! KarenA’s situation is a perfect example of banks not treating customers fairly – think how many more customers in that branch, that bank, and other banks that will have been treated in the same way.”

Gonna have to disagree with your comment about KarenA’s situation

The reason Automation & efficiency are the holy grail is to make a profit and pay dividends / return to the taxpayer the money they invested. Im sure that you would be only too happy to have high performing high dividend investments in your portfolio !!

In respect to Karen – the situation is quite clear – The money WAS NOT in the account – End of

It is not up to a Bank to be crystal ball gazers and check other accts to see if money that is in it will be transferred via a S/O payment – just because it was last month doesnt mean it will this month.

Get Real – stop poking at things you know little about and start focusing on things you can change

Katie says:
20 February 2013

Didnt realise who you were till I checked Twitter – A man who makes money claiming that organisations dont treat people fairly.

Perhaps you might like to focus your attention on the case of Nic Hughes who had a £100k life insurance policy with your old employer (Friends Life) and was denied his claim as he didnt tell them about something completely unconnected to the illness he contracted.

Hmmmm…… And YOU have the indecency to complain about banks…..

Stephen Rosling says:
17 February 2013

I guess its a question of priorties – customers first or shareholders? I know which I would rather be.

Katie says:
20 February 2013

I agree customers should come first – however I’m also aware that as a shareholder, I want the share price to perform so that my investment goes up and when I retire that my pension fund is sufficient to allow me to enjoy life.

I’d be interested Stephen in hearing HOW you think the bank SHOULD / COULD have done things differently for Karen – other than perhaps refunding the £10

KarenA says:
17 February 2013

My joint bank account is fed by a standing order from my sole account. I set my standing order to go out on the 30th of the month. Then I decided to set it to 29th of the month so it would get there earlier. This was lucky because otherwise I wouldn’t have known that my next payment had been set to 28th Feb!! I don’t get paid until the 28th so by my bank’s new 24 hour rule and their irregular adjusting of my payment date, there’s another £10 levy for not having the money in on the 27th.

That means I’m going to get stung every February under this process unless I switch my standing order to the first of the month. Then when the first of the month falls on a Saturday, my standing order in won’t go in to the joint account until the following Monday 3rd, which means my standing orders can’t go out until the 4th of the month to get around this. In a 31 day month that is 7 days after I get paid. I don’t want to wait that long. Up until December it was fine for my standing orders to go out on the same day that my standing order feeding the account went in.

I haven’t had an answer from my bank as to why they didn’t take into account the £800 standing order going in to the account so I am going to go back to them and ask them that. I am also going to take this to my branch manager to get his take on this newly arisen problem.

My bank account isn’t free but I don’t begrudge paying fair charges for a fair service or even if I had gone overdrawn. But I didn’t – the cleared funds WERE available in my account on the standing order due date. I can’t see anywhere in the standing order set up online where it says that funds need to be in the account 24 hours in advance – it simply asks for the date you want it paid. I do most of my banking online and I agree that automation is fantastic but not when processes are unfair, unjust and seem to be designed to take advantage of the customer.

The answer seems simple. Switch your standing order to the first day of the month and hopefully you will have no further problems. Personally, I would make it a couple of days later just to be sure.

By all means you can discuss this with your bank manager but I suggest you read the bank’s terms & conditions first. Do let us know if you have any success.

Karen, can you arrange an overdraft facility to cover the payment just in case the timing is out? If it is authorised, the cost of a couple of days loan may save the worry of excess charges.

Katie says:
20 February 2013

Or of course you could reverse the process pay your salary into the joint acct and transfer the rest out…. Or I guess you could agree with your partner to pay £800 of the bills from your account and let them pay the rest from the joint acct or their own acct

KarenA says:
19 February 2013

I’m not sure you are getting this. I had the money in my bank account to make the payment on the date it was due and the bank ignored that. I don’t need an overdraft facility. I am going to dump Lloyds TSB’s new standing order process in favour of making the transfers manually in future. Cleared funds from one account to another. Let’s take back control from the untrustworthy!

I was not aware from the conversation that you had cleared funds in your account BEFORE the bank tried to pay your standing order. The impression was that they were there on the same day, but may not have been transferred in at a time before they attempted to pay the outgoing standing order. Sorry if I missed that.
I can only agree if that was the case your bank was at fault. If, however, they had been transferred in at a time later than paying the outgoing one then I could see how the problem could have occurred – maybe due to the sequence in which the automated transactions take place. nevertheless I would have thought the bank would have been sympathetic and helped overcome the problem in future.
My overdraft facility helps if a problem like this arises, or if I overlook temporarily doing a manual transaction in time. I sense your anger, but an expedient solution such as this could prevent your blood boiling in future?

Katie says:
20 February 2013

And Karen – yes you’re right we dont get it – Your earlier comment said

“My bank recently refused to pay a standing order when the funds were available to pay it and charged me £10 for the priviledge. The standing order fell on a weekend so was due to be paid on the Monday. They looked at funds available on the Sunday and decided it wasn’t enough. They failed to take into account the fact that a standing order from another of my bank accounts at the same bank was due into the account on the same date that the standing order was due out. This standing order has funded the account for months and this problem never occurred previously. My bank failed to take into account that I am a good customer with a good credit record who had plenty of money in their bank.”

Whilst the money may well have been “In the Bank” it appears it wasn’t “in the account” at the time.

Im not sure what you think they did wrong?

On a seperate note – What is it about this transaction that makes the bank “untrustworthy”?

For me trust is either “interaction” or “institution” based

Institution based trust is regulated at Industry level – and is managed through sets of rules – i.e Consumer Credit Act, The Law, etc etc – I cant see that your bank has breached that

Interaction based trust has several strands – Your disposition to trust (a general trait unique to you), and then Trust becomes a function of trustworthiness which is informed by a number of factors e.g Shared Values, Benevolence, Integrity, Competence etc

Again if we look at this – and you use the term “untrustworthy” so I’ll focus purely on the trustworthy element – Competence – The Bank has an automated system which is account specific – the money was not in the account at the point at which the s/o tried to send so it wasnt paid – Do they fail the test? – Well IMHO no, because that was a fact it seems – where you could say it fell down was that the money was in a different LTSB acct which also had a S/O to pay into the joint acct – For Data protection reasons, the computer does not sweep to check your other accts – so I cant see they fail on Competence.

Do they have integrity – Well as a taxpayer you own a % of them, so they are accountable to you indirectly. They also did not fail based on the T&C of your agreement with them. I cant see how they dont have integrity, but I can see a justification for giving you £10 back.

Do they have shared values – I would say yes, but I could see that in your view that wouldnt be the case – Look at Antonio Horto-Osorio’s speech at the CBI Dinner last year – he talks about going back to basics and doing things right – so I still argue yes.

So on that basis, I would argue LTSB IS trustworthy.

No one stops you doing manual transactions, BUT if you forget, then I assume you wouldnt object to being charged for your error?

Stephen Rosling says:
20 February 2013

1. The bank should take the necessary action to quickly investigate and resolve address Karen’s complaint.
2. The issue should be escalated and an initial investigation undertaken to establish how many other customers find themselves in similar positions.
3. If the initial investigation reveals that other customers are in similar positions, the Bank should mobilise a full investigation into the relevant systems and processes and take appropriate action to remedy.

Katie says:
20 February 2013


Respectfully – Dont be so stupid – the facts as explained by Karen appear quite clear

2 accounts – Joint acct (Bills acct) & a sole account (Karen’s acct)
Transactions processed on working days only – so whereas when payday falls on a Sunday we get paid on a Friday, where a DD or SO payment is due it will be taken a day later – the comment about February is down to the calendar – or the way the SO is set up
The money (£800) was in her sole account NOT the joint account
Standing order process meant that the T/F from the sole to the joint acct took place AFTER an instruction to pay something else was either claimed by another company (DDM not controlled by LTSB) OR and yes it really could be this simple in acct No order – so if the Joint acct is 12345678 and the sole acct 12345679 then the SO payment goes from the 78 acct before the TF in from the 79 account

What exactly have the bank done wrong here – Other than not have a crystal ball embedded into the computer?

Get Real !!

Stephen Rosling says:
20 February 2013

Katie: Whatever the “ins and outs” of this issue, the Bank have done enough wrong to upset one of their customers – so much so they feel motivated to share their frustration on a public forum.

I don’t intend to comment on the details of this particular transaction – as I said the bank need to deal with this as a complaint.

If this bank was truly customer focused, (and following the FSA’s TCF Principles), they absolutely should follow steps 2 and 3. (You failed to notice that I used the word “if” in my last bullet.)

Let’s not also forget that banks – albeit in the US – have paid millions to settle accusations that they improperly manipulated debit transactions to generate higher overdraft revenue.

Stephen, your final comment that US banks “improperly manipulated debit transactions to generate higher overdraft revenue” presumably suggests the same may be happening here – otherwise why raise it. Do you have evidence for this?

Katie says:
20 February 2013

Seems that the Bank did investigate it from Karen’s comments – she just didnt like the outcome, and despite having worked for a Bank for 7 years appears to be unaware of processes that have been in place on consumer accounts for many years.

Bottom line for me is – and ignore the complication of a weekend for a moment

Money In – Money out…..

IF the money out comes before the money in, then there were not available funds. If the banks processes paid money out of accounts before money in, then Karen would be caught out. If they take money In first, then she would be ok, however unless that arrived at 0:01 on the day of the transaction that couldnt work.

Assuming it could work, it creates a cyclical process a little like the story of the traveller who came into town and booked a room in the hotel paying £100 cash. The hotelier took the £100 and paid his bookie what he owed him, who in turn went to the butcher, and paid him for the meat he owed him for. The butcher went to the barman and settled his bar bill whereby the bar man paid the prostitute, who paid the hotelier for the hire of the room. The hotelier paid the moneylender, who – you guessed it , had rented the room…..

Where trust (Generalised & system trust) exists, we all get paid, and Karen’s transaction is taken on trust that her £800 will come from her other account that same day… Where distrust exists, then consumers believe they have a right to complain about the smallest thing and demand compensation – Wish as a banker, I could do that when my customers dont do what they say 🙂

The facts on this are cloudy as to whether the payment into the account was made after a payment out was attempted. Until this is quite clear then it is unfair to s**g off the bank. The problem has arisen because under certain circumstances the transactions occut too close together; that should be recognised and remedied so that it won’t happen again. Problem solved and blood pressure falls.