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Q. I have held a Barclaycard for over 30 years. When I rang to activate my new card, I was told I could apply for an "Identity Protection Alert" policy. I was also told I could change my mind, providing I did so within two weeks.
Subsequent investigation suggested this wasn't a good deal and I rang to cancel the agreement, following it up with a letter sent by recorded delivery.
Yet the payment still appeared on the next statement. When I called Barclaycard, I was told that the company I had talked to in order to activate my new card had nothing to do with Barclaycard and so it couldn't help.
I believe I am due a full refund of the £69.90 I have been charged. FT, London
A. These identity protection schemes strike me as a bit of a ruse. Surely those to whom we entrust our identity should be protecting it without us having to pay extra?
It also strikes me that the UK financial services industry has been oversold the benefits of outsourcing, and cases like this show its limitations. All too often, a company suggests that something is not its responsibility even when a product or policy has been sold under its brand.
Fortunately, when I contacted Barclaycard with your query, it acted very promptly to address the issue. It said it had advised you to contact CPP Ltd – to whom it outsources the provision of these identity protection policies – to cancel the policy because it was unable to do so on your behalf. This seems to be where the problem had arisen. However, it has passed your details to CPP, which has confirmed that the policy is now cancelled. The repayment will show up on your next statement.
Q. I have had a claim in with my bank for the refund of unfair charges for the past 11 months. A general freeze on claims has been in place as the banks challenge these claims in court, but recently I've seen reports that the banks will now be required to handle complaints involving customers in real financial hardship.
I have been in a debt management plan for over two years. As part of that plan, I cannot have credit facilities. But due to high household bills I had to go into unauthorised overdraft. As a result, I was charged £1,900 over 18 months by my bank, Lloyds TSB. At one stage, it was charging me £35 a day, even if I was only £5 in the red.
I rang it when I read about the new position on complaints for those who can show they are in hardship. However, my branch pleaded ignorance to the new guidance and said my claim for a refund would remain frozen pending the court's final decision on whether charges are fair or not. DW, Norwich
A. The waiver has proved convenient for the banks, allowing them to keep charges already levied during the potentially long wait for the legal verdict. But you are right that the court has put provision in place for those in genuine hardship.
Brian Capon of the British Bankers' Association says: "The Financial Services Authority [FSA] has agreed that claims lodged with banks for refunds can be held pending the outcome of the case brought jointly by the Office of Fair Trading and certain banks to resolve legal uncertainties.
"However, where customers are experiencing financial difficulty, the bank must ensure a 'fair, consistent and intelligent' filtering of new complaints to assess whether a claim is justified."
He suggests you go back to your bank and ask for your claim to be reviewed, referring it to the FSA waiver dated July 2008. Don't be fobbed off; it has a legal obligation to take your claim seriously. If it continues to put up objections, you may consider a complaint to the Financial Ombudsman.
Q. I have received a "statutory demand" for £1,500 outstanding on a store card. The firm says that if I can't pay, I will be made bankrupt and my house will be under threat. The equity in my home is much more than £1,500. How do these demands work? And can I really be made bankrupt over a relatively small sum? MG, Southampton
A. As interest rates on credit cards rise, and household bills do the same, more people are facing debt problems. The papers are filled with stories of families who borrowed at favourable rates only to be stung as banks hike repayments.
Frances Walker of the Consumer Credit Counselling Service(CCCS) says: "In theory, any creditor can make you bankrupt if you owe more than £750, but in practice most of them won't do so. Usually, statutory demands are issued by debt-collection agencies as a 'bluff'. Do not ignore them, however, as every year a small number proceed to court.
"Write to the collection agency, requesting a copy of the original credit agreement under section 77/79 of the Consumer Credit Act 1974. In theory, if the agreement cannot be provided then the debt is 'unenforceable' and so bankruptcy can't be pursued. In practice, once the debt is challenged, it will be referred back to the original creditor, which is likely to suggest a repayment arrangement."
If you have more than one debt, charities such as the CCCS (cccs.co.uk) can help you in devising a realistic repayment plan.
It is best to address these issues sooner rather than later as creditors take a more sympathetic view of those who are working to solve their problems, rather than waiting until the bailiffs are on the doorstep
Q. I have held a Barclaycard for over 30 years. When I rang to activate my new card, I was told I could apply for an "Identity Protection Alert" policy. I was also told I could change my mind, providing I did so within two weeks.
Subsequent investigation suggested this wasn't a good deal and I rang to cancel the agreement, following it up with a letter sent by recorded delivery.
Yet the payment still appeared on the next statement. When I called Barclaycard, I was told that the company I had talked to in order to activate my new card had nothing to do with Barclaycard and so it couldn't help.
I believe I am due a full refund of the £69.90 I have been charged. FT, London
A. These identity protection schemes strike me as a bit of a ruse. Surely those to whom we entrust our identity should be protecting it without us having to pay extra?
It also strikes me that the UK financial services industry has been oversold the benefits of outsourcing, and cases like this show its limitations. All too often, a company suggests that something is not its responsibility even when a product or policy has been sold under its brand.
Fortunately, when I contacted Barclaycard with your query, it acted very promptly to address the issue. It said it had advised you to contact CPP Ltd – to whom it outsources the provision of these identity protection policies – to cancel the policy because it was unable to do so on your behalf. This seems to be where the problem had arisen. However, it has passed your details to CPP, which has confirmed that the policy is now cancelled. The repayment will show up on your next statement.
Q. I have had a claim in with my bank for the refund of unfair charges for the past 11 months. A general freeze on claims has been in place as the banks challenge these claims in court, but recently I've seen reports that the banks will now be required to handle complaints involving customers in real financial hardship.
I have been in a debt management plan for over two years. As part of that plan, I cannot have credit facilities. But due to high household bills I had to go into unauthorised overdraft. As a result, I was charged £1,900 over 18 months by my bank, Lloyds TSB. At one stage, it was charging me £35 a day, even if I was only £5 in the red.
I rang it when I read about the new position on complaints for those who can show they are in hardship. However, my branch pleaded ignorance to the new guidance and said my claim for a refund would remain frozen pending the court's final decision on whether charges are fair or not. DW, Norwich
A. The waiver has proved convenient for the banks, allowing them to keep charges already levied during the potentially long wait for the legal verdict. But you are right that the court has put provision in place for those in genuine hardship.
Brian Capon of the British Bankers' Association says: "The Financial Services Authority [FSA] has agreed that claims lodged with banks for refunds can be held pending the outcome of the case brought jointly by the Office of Fair Trading and certain banks to resolve legal uncertainties.
"However, where customers are experiencing financial difficulty, the bank must ensure a 'fair, consistent and intelligent' filtering of new complaints to assess whether a claim is justified."
He suggests you go back to your bank and ask for your claim to be reviewed, referring it to the FSA waiver dated July 2008. Don't be fobbed off; it has a legal obligation to take your claim seriously. If it continues to put up objections, you may consider a complaint to the Financial Ombudsman.
Q. I have received a "statutory demand" for £1,500 outstanding on a store card. The firm says that if I can't pay, I will be made bankrupt and my house will be under threat. The equity in my home is much more than £1,500. How do these demands work? And can I really be made bankrupt over a relatively small sum? MG, Southampton
A. As interest rates on credit cards rise, and household bills do the same, more people are facing debt problems. The papers are filled with stories of families who borrowed at favourable rates only to be stung as banks hike repayments.
Frances Walker of the Consumer Credit Counselling Service(CCCS) says: "In theory, any creditor can make you bankrupt if you owe more than £750, but in practice most of them won't do so. Usually, statutory demands are issued by debt-collection agencies as a 'bluff'. Do not ignore them, however, as every year a small number proceed to court.
"Write to the collection agency, requesting a copy of the original credit agreement under section 77/79 of the Consumer Credit Act 1974. In theory, if the agreement cannot be provided then the debt is 'unenforceable' and so bankruptcy can't be pursued. In practice, once the debt is challenged, it will be referred back to the original creditor, which is likely to suggest a repayment arrangement."
If you have more than one debt, charities such as the CCCS (cccs.co.uk) can help you in devising a realistic repayment plan.
It is best to address these issues sooner rather than later as creditors take a more sympathetic view of those who are working to solve their problems, rather than waiting until the bailiffs are on the doorstep
