Open Letter to Lloyds re Social Inclusion and First right of appropriation

[Amy]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

Ame, I'm on it. Big Brother will get back to you......

[Amethyst]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

Cheers honeybunch

[TANZARELLI]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

I am writing to you, as part of the Administration Team at the rapidly growing Legal Beagles Consumer Group, to request information about your banks current policy with regards to an individuals first right of appropriation.

I am aware of XXXXXXXX efforts to help consumers who have, through no fault of their own, suffered financial hardship. However, despite your undoubted efforts in the matter, I would like to raise some issues that seem to be tarnishing your otherwise impeccable reputation. (Oh I feel sick LMAO)

I am sure you are aware that an individual has the ability, under common law, to assert their first right of appropriation where money intended to cover essential living expenses are being taken by the bank in what may (by some) be considered unfair charges or in fulfilment of other debts.

The Social Security Administration Act 1992 (s187) clearly states:


"187 Certain benefit to be inalienable

(1) Subject to the provisions of this Act, every assignment of or charge on—

(a) benefit as defined in section 122 of the Contributions and Benefits Act;

(b) any income-related benefit; or

(c) child benefit,

and every agreement to assign or charge such benefit shall be void; and, on the bankruptcy of a beneficiary, such benefit shall not pass to any trustee or other person acting on behalf of his creditors."



This "first right of appropriation" allows a customer to assign any funds entering their account to finance basic survival needs. This is something all the banks should be aware of, but sometimes junior members of staff do not understand this process since it is not very often used. These occasions cause significant financial hardship.


You may also be aware that many council's recommend the use of an individuals first right of appropriation, with regards to allowing housing benefit and local housing allowances paid into an individuals bank account, to be used solely for paying housing rental costs.

It does appear from the council's that they too have experienced problems with some of the bank staff's knowledge of the law. Indeed Hinckley and Bosworth Borough Council in their advice leaflet on the use of the first right of appropriation clearly state '' Your bank may disregard this request. If this does happen you would then have to complain and involve the banking Ombudsman, which could take some time to resolve. ''.

I am aware that you have made several commitments via the banking code to act reasonably to debtors in poor financial circumstances, and of the ongoing discussions and evidence you have submitted to the Treasury Committee's reports on social exclusion.

Therefore, I would ask if you have any policies in place, or planned for the future, for tackling poverty, and for ensuring that your customers are able to access benefits such as housing benefit and jobseekers allowance where they are necessary to fulfil basic needs. I would also be interested to know what information(remove space) , guidance and training your staff receive regarding an individual's first right of appropriation.

Whilst I am aware you are extremely busy I would ask you to acknowledge this correspondence as soon as possible, indicating when you will be able to answer the questions raised in this letter.


Yours Sincerely

I always thought it was refered to as first right of....... not right of first also is it worth adding the SSA Act 1992 (s187) quote?

Feel free to remove if not. Also there are lots of other benefits that would also be included in the list Tax Credits etc.

[Amy]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

I am writing to you as part of the Administration Team at the rapidly growing Legal Beagles Consumer Group to request information about your policy with regard to an individuals first right of appropriation.

I am aware of XXXXXXXX efforts to help consumers who have suffered financial hardship, particularly due to an foreseen change in their circumstances, but I would like to raise some issues that seem to be tarnishing your otherwise impeccable efforts in this area.


As you are no doubt aware, an individual possesses the right under common law to assert their first right of appropriation when funds paid into their account, which are intended to cover basic and essential living expenses, are removed and used by the bank, in what may be considered unfair charges or for the fulfilment of other debts.

The Social Security Administration Act 1992 (s187) clearly states:

"187 Certain benefit to be inalienable

(1) Subject to the provisions of this Act, every assignment of or charge on—

(a) benefit as defined in section 122 of the Contributions and Benefits Act;

(b) any income-related benefit; or

(c) child benefit,

and every agreement to assign or charge such benefit shall be void; and, on the bankruptcy of a beneficiary, such benefit shall not pass to any trustee or other person acting on behalf of his creditors."

To clarify the above, this allows a customer to assign certain benefits entering their account to be used for the sole purpose of their and their families' basic survival needs.


This matter is something all the banks should be aware of, but it appears that it is the junior members of staff who do not understand this process and in some cases have absolutely no idea what the first right of appropriation is.


It is seldom used, but ignorance is no defence.

Many county councils recommend the use of the first right of appropriation with regard to allowing housing benefit and local housing allowances paid into an individuals' bank account, to be used solely for paying housing rental costs.

It would also appear that a lot (if not most) county councils have experienced similar problems with the knowledge, or lack thereof, of some bank staff with regard to this particular law.


Indeed Hinckley and Bosworth Borough Council in their advice leaflet on the use of the first right of appropriation state '' Your bank may disregard this request. If this does happen you would then have to complain and involve the banking Ombudsman, which could take some time to resolve.''


It is simply unacceptable for a bank to respond in this manner when a first right of appropriation request is received.

I am aware that you have made several commitments via the banking code to act in a reasonable and responsible manner toward debtors in poor financial situations and of the ongoing discussions and evidence you have submitted to the Treasury Committee's reports on social exclusion.

However, I would like to request clarification as to what policies, if any, you have in place specifically for tackling hardship together with ensuring your customers are able to access their benefits for the purpose of which they are intended.


I would also be very interested to learn what information, guidance and training your staff receive regarding an individual's first right of appropriation.

I very much look forward to your comments on this matter.

Yours sincerely/faithfully

[Amethyst]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

I wouldnt agree with including sec 187 as this isnt really about benefits as such...the benefits come into the issue cause thats the lowest income group that tends to be most effected by the non following of the FROA, plus I dont believe 187 does apply to bank charges. Probably a matter for discussion first ?

[Amy]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

Do you want me take that bit out then and rewrite?

[Amethyst]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

I think so, I dont know others opinion tho.

Thank you Amy sounds much better so far

[tomterm8]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

As far as I know, s187 really isn'y talking about bank charges, or even using funds that are placed in a bank account to set off existing debt. A term on the contract that requires you to pay benefits into the account would be a legal charge, and would be void, but if you chose to pay money in the bank can grab it without further legal action.

[Amethyst]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

For interest - from RBS - dated mid may this year but last updated last august

[tomterm8]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

That's disappointing, but it fits with my understanding of what the banks policies actually are.

[Amethyst]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

Caring isn't it. Just scanning Lloyds letter in now.

[Amethyst]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

[tomterm8]

Re: Open Letter to Lloyds re Social Inclusion and First right of appropriation

Hmph. Well, it might be worth buying a Lloyds TSB share