First Right of Appropriation...offsetting debt against benefits RBS

[Tools]

Re: First Right of Appropriation...offsetting debt against benefits RBS

Ame and myself have discussed this much of the day, I think the direction Ame is taking this is spot on.

My suggestions are that once Ame is happy with the discussions she has been in with the banks , mainly RBS, Barclays and Nationwide have been exhausted and concluded that she then takes it a step further.

Clarify the position as to whether the common law right of appropriation overrides the banks terms and conditions regarding offsetting funds against overdrafts/debts to the bank. If this is the case then make enquiries with the OFT as to if the term of offset can be regarded as unfair in its current state or whether there should be investigations/recommendations made to vary that term to include the consumers FROA and therefore redress the imbalance (Regulation 4 UTCCR 1999).

Contact the DWP namely Kitty Ussher with her findings with a view to lobbying parliament to reform/instigate/implement the inalienabilty of Social Security Benefit Payments so they cannot be taken from an account holder without their express agreement.

Among the list of her areas are :-

• Financial Inclusion
• Debt Management
• Methods of Payment Reform
• Benefit Simplification
• Housing and Council Tax Benefit policy and delivery
• Social Security Advisory Committee

She would be an ideal minister to approach about FROA and Benefit Inalienabilty.

RBS have already conceeded that FROA would be used if the consumer so requests it in the correct manner. They now need to, as Ame says, make their staff at branch and customer contact centres more aware of this.

[Tools]

Re: First Right of Appropriation...offsetting debt against benefits RBS

I also think that trying to get it so that appropriating funds such as housing benefit, council tax benefit etc can be set up to be regularly appropriated directly to its rightful place, instead of having to submit a FROA request each time it is needed.

[enaid]

Re: First Right of Appropriation...offsetting debt against benefits RBS

I also think that trying to get it so that appropriating funds such as housing benefit, council tax benefit etc can be set up to be regularly appropriated directly to its rightful place, instead of having to submit a FROA request each time it is needed.

That can be done according to this info on here

http://www.corby.gov.uk/SupportingDo...ropriation.pdf

I was trying to get a list of councils that actually recommend using the FROA, but it's not as easy as you think lol.
Anyway maybe we could send them an email and ask for their info on it.

Also I think it is mentioned that this will only be taken as a temporary step by the banks and the may eventually close your account.
I think this needs addressing too.

[enaid]

Re: First Right of Appropriation...offsetting debt against benefits RBS

Maybe not such a good idea to email the councils, I didn't know we had this many

A to Z of local councils : Directgov - Directories

[Amethyst]

Re: First Right of Appropriation...offsetting debt against benefits RBS

That can be done according to this info on here

http://www.corby.gov.uk/SupportingDo...ropriation.pdf

I was trying to get a list of councils that actually recommend using the FROA, but it's not as easy as you think lol.
Anyway maybe we could send them an email and ask for their info on it.

Also I think it is mentioned that this will only be taken as a temporary step by the banks and the may eventually close your account.
I think this needs addressing too.

Corby have some of their info wrong, I have emailed them, hinkley and bosworth and a couple others but havent had a response yet.

I think maybe someone from RUC works in the council as they seem to have used some of their info on the council site.


We know Lloyds will clos eyour account if you try a FROA more than once and put the close accounts bit to natwest, seeing as they are being helpful

Actually should try Lloyds again.

[enaid]

Re: First Right of Appropriation...offsetting debt against benefits RBS

I have read somewhere else though you can do a one off instruction, but can i find it................................................ ..

[Amethyst]

Re: First Right of Appropriation...offsetting debt against benefits RBS

I have read somewhere else though you can do a one off instruction, but can i find it................................................ ..

Credit Union? No i have seen it too,

Here Warwick council (thats the other one i emailed)

In the written instructions you give your bank, you should ensure that you make it clear if you wish any regular payments or future deposits to your account to be used to pay for specific items. If you do not make this clear, you will have to give new instructions each time a deposit is made.

The advice is all quite wishy washy because the banks dont deal with the requests well or in any one way. The 7 days in advance isn't laid out in law or anything its simply a thing about giving the bank enough time to stop transaction.

[enaid]

Re: First Right of Appropriation...offsetting debt against benefits RBS

Well I can understand them saying about human intervention with this, but if it's a case of cost, then I suppose they could have a moan.
If it's just a case of 'can't be arsed' then they need a very large kick up it imo.

This appropriation thing is widely used for different things so there must be some steadfast rules in it.

[Amethyst]

Re: First Right of Appropriation...offsetting debt against benefits RBS

Interesting Letters from Patricia Hewitt to the BBA re direct payments, offsetting and basic bank accounts , and response from the BBA

Direct Payment Accounts
Our members are aware that funds should not be taken from separate designated basic bank
accounts used solely to collect direct payments, to settle debts on another account. Of course it is
not always clear that an account is to be used solely for handling direct payments. Social
services departments or the Department of Health should inform their contacts within the head
offices of the bank concerned, or through us, of cases where direct payments to designated
accounts have been taken to repay overdrafts.

BBA also say in comment

Recipients of direct payments sometimes wish the funds to be paid into a designated basic bank account and it is important to note the letter makes a commitment that members will not set off credit balances held on separately designated basic bank accounts against debts on other accounts.

[Amethyst]

Re: First Right of Appropriation...offsetting debt against benefits RBS

(c) Use of bankers right of
set-off

We have been concerned to have received reports from debt advisers of what appears to be inappropriate use of set-off where the customers are in
financial difficulties and where the funds appropriated had been intended by the customer to meet essential day-to-day living expenditure. The supporting information that the debt advisers have provided would seem to indicate that this may in some cases be a systemic issue. We are seeking specific case details and intend to investigate these formally. In the meantime we draw attention to paragraph 14.3 of the Guidance which says:
“The subscriber should acknowledge that income should only be used to repay ‘non-priority’ debts once provision has been made for any ‘priority’ debts. The subscriber should leave the customer with sufficient money for reasonable day-to-day expenses, taking into account individual circumstances..”

BSCB March 2009

[Amethyst]

Re: First Right of Appropriation...offsetting debt against benefits RBS

FINALLY got round to emailing Kitty User, have only kept it brief and sent her copies of the letters, I don't expect a response for a while, shes up to her neck in the expenses scandal (20k doing up an old house lol)

[Amethyst]

Re: First Right of Appropriation...offsetting debt against benefits RBS

Completely ******** reply but then I suppose she has been a bit busy resigning and whatnot ( Kitty Ussher resigns from Government over 17,000 tax dodge: MPs' expenses - Telegraph )

suppose

''
Decisions about charges for overdrafts, loan repayments or other fees for banking services are commercial matters for the banks. The Department makes payments into the account nominated by the customer. Once a benefit payment is credited to the customer’s account it merges with the existing account balance, whether this is overdrawn or in credit and there is no ring-fencing of monies paid in respect of benefit entitlement. If the account is overdrawn, the bank is fully within its rights to offset the benefit payment against the overdraft. ''

is helpful in a way. anyway will find out who is taking over fromms usher and have a rant about financial inclusion etc.

[IMG]file:///C:/Users/Sharon/AppData/Local/Temp/msohtmlclip1/01/clip_image002.gif[/IMG]

Website: Department for Work and Pensions E-mail Ministers at: ministers@dwp.gsi.gov.uk
Public, Parliament and Stakeholders Division, Caxton House, London SW1H 9NA

Your Reference:
Our Ref: TO/09/4744
Date: 18 June 2009


Dear ,

Thank you for your e-mail of 25 May to Kitty Ussher regarding the first right of appropriation.

I am sorry that Ministers has not been able to reply to you personally but I hope you can appreciate that they receive a very large volume of correspondence and it is not possible for them to respond to each letter individually. Your letter has been passed me for reply.

Decisions about charges for overdrafts, loan repayments or other fees for banking services are commercial matters for the banks. The Department makes payments into the account nominated by the customer. Once a benefit payment is credited to the customer’s account it merges with the existing account balance, whether this is overdrawn or in credit and there is no
ring-fencing of monies paid in respect of benefit entitlement. If the account is overdrawn, the bank is fully within its rights to offset the benefit payment against the overdraft.

However, under the terms set out in the Banking Code, banks are obliged to deal with all cases of financial difficulty sympathetically and positively. Customers who find themselves in difficulty because of bank charges should contact their account provider about their needs in order to come to an arrangement to deal with their debt and safeguard their future benefit payments.

Yours sincerely



Miss C Armstrong
Ministerial Correspondence Unit

[natweststaffmember]

Re: First Right of Appropriation...offsetting debt against benefits RBS

We know that Right of set off seems to overtake the First Right of Appropriation in banking contracts

[Amethyst]

Re: First Right of Appropriation...offsetting debt against benefits RBS

Yep thats the bit we need sorting....and what I was trying to say yesterday re the FSa conversations -

soooooooooooo any ideas folks and folkesses

[Amy]

Re: First Right of Appropriation...offsetting debt against benefits RBS

Miss C Armstrong should follow Miss Ussher out the door allowing that to leave her desk.