Earlier this year, Barclays took away my overdraft without warning. After a morning in a branch, it transpired that it intended to close seven accounts with less than two months’ notice.
I have banked with Barclays since I was 12 years old and I am now nearly 50. I have a current account, Isa, savings accounts for my children and business accounts with the bank.
No one in the branch could explain why this was happening and Barclays’ policy is that it does not need to give a reason for the account closure if it gives you two months’ notice.
Account anguish: Our reader had her Barclays current, savings and childrens’ accounts closed, but the bank’s rules stated it did not need to tell her why
I really don’t know why this happened. My main business account was in a lot of credit and my personal account dipped into the overdraft and out again.
The overdraft was £15,000 and I rarely went over a couple of thousand as a buffer for large payments or for cashflow reasons.
Accepting my fate, I transferred the accounts I needed and left some to be closed.
Despite repeated requests by phone, email and branch visits I have not received any letter setting out the balances of all my accounts at closure. My access to the Barclays app and internet banking has been taken away.
I was also told more than £4,000 from my accounts was being ‘held’ and to release it I should go into a branch with two forms of ID.
When I did this, i told me that the money could only be released to another Barclays account.
I think this is a terrible way to treat loyal customers, but more importantly this is my money and it seems to have disappeared. Please can you help. R.C, Berkshire
Helen Crane of This is Money replies: This bank account bombshell came as a shock.
You told me you first discovered the issue in a taxi to the airport, when you weren’t able to withdraw money to pay the driver as your overdraft had been suspended – almost missing a flight in the process.
Not having access to your main bank accounts – including your current account, savings and accounts for your business – has obviously made your life very difficult.
Your access to Barclays’ online banking app was suspended as you no longer had an active current account, and you could no longer access online banking.
With paper statements not forthcoming, you struggled to even find out which accounts were being closed – let alone why – and didn’t have a record of how much money was inside.
Why would this happen? It may surprise some readers to learn that banks can close your account with as little as 30 days’ notice, according to FCA guidelines, and they don’t have to give you a reason.
We have reported on similar instances before – including this reader who had her accounts closed by Barclays in 2017.
This is one of the many things buried in the small print we often ignore when opening new accounts.
Some of the reasons banks use to justify closing accounts involve activity that could be relatively innocent – such as using overdrafts too frequently.
Banks sometimes move to reduce the amount of customers they have that are deemed to be ‘riskier’ than others, even if they haven’t done anything wrong. They run computer checks on their customers and these kind of things can raise a red flag.
Other times, customers may have activity that arouses suspicion of fraud, such as making too many transfers between accounts – but again could be entirely innocent.
In more serious cases banks may have found what they believe to be actual evidence of fraud or criminal activity, and in these cases the account will be closed without warning.
In your case, you had banked with Barclays for your entire adult life, and almost all your finances were tied up with it in some way.
Whenever you had needed financial services – whether that was taking out a mortgage, running your business or setting up an account to collect money from parents when you were on a school PTA – you had put your trust in Barclays.
Clueless: Without access to her bank statements online, R.C had no idea how much money was in the closed accounts
I think it is a great shame that the bank has not shown the same loyalty to you. Even if it couldn’t give you a reason for the account closure, it didn’t have to add salt to the wound by making it so difficult for you to work out what was going on and withdraw your money.
These problems began in April, and the fact that it has taken six months – and my involvement – to come to a conclusion is unacceptable.
When you first contacted me in July, you had managed to get some of the money from your closed accounts – but had been told that £4,000 was being ‘held’ and you would need to visit a branch with two forms of ID to get it transferred to your other current account with a different bank.
But it turned out that Barclays bank staff aren’t allowed to transfer money from a Barclays account to one with another provider.
It should have given you a bankers’ draft, and Barclays says it has now spoken to the manager of that branch to make sure staff are aware.
This is just one example of the misinformation you have been given throughout this whole process.
You were also told you would be sent a years’ worth of paper statements for your Barclays accounts, to help you untangle the mess and work out which accounts were being closed and how much was in them. These never arrived.
Barclays has not covered itself in glory, but I am pleased to report that you now have all of the money from your closed accounts, as well as an additional offer of £200 compensation, added to £200 you received in August along with your closure balance.
Unfortunately you have described this offer from Barclays as ‘wholly inadequate’ given the difficulties you have experienced and the time it has taken to resolve.
A Barclays spokesperson said: ‘We believe the sum offered for the distress and inconvenience was fair and reasonable and this will not be increased further.’
It has also given you information on how to access your remaining accounts online, though said you can no longer access the app as you don’t have a Barclays current account.
It’s a shame that as such a loyal customer you couldn’t bank on Barclays to treat you fairly in your hour of need. And we will never know the reason why the accounts have been closed.
CRANE ON THE CASE
Hit and miss: This week’s naughty and nice list
Every week, I look at the companies who have fallen short when it comes to customer service, and those who have gone above and beyond.
Miss: Reader Sue wrote in as she was making (O)slo progress getting a refund on some flights she booked with airline Norwegian.
She had flights booked to San Francisco in summer 2020, but they were cancelled during the pandemic. Sue agreed to take vouchers for the £1,200 tickets in order to support the travel industry, and planned to reboot her Californian trip later on.
But Norwegian has now cancelled its long haul routes and only flies within Europe, meaning that won’t be possible.
With the vouchers due to expire at the end of this year, Sue contacted me to see if I could help get her a refund.
Flight fail: Sue’s trip was cancelled due to Covid, but Norwegian won’t replace her vouchers with a cash refund
I contacted Norwegian, explaining that while she was initially happy to fly with them again when she did eventually get to the Golden state, she now couldn’t do so.
While I have managed to get a result for readers in this situation in the past, I’m afraid the airline maintained it could not return the money in cash.
Norwegian struggled during the pandemic, and as a result it entered a ‘reconstruction’ process in 2021 to try and save the business.
The plan worked, but resulted in major operational changes including the scrapping of long-haul routes.
A spokesperson told me that, under the rules of the reconstruction, Norwegian is ‘not legally permitted to pay out any refund claims from before 18 November 2020’.
She also said it was ‘unfortunately, unable to convert [vouchers or points] into cash.’
‘We understand our customers frustration and regret not being able to accommodate further,’ she added.
Sadly there was Norway I could get them to change their minds. I have however suggested that you explore a Section 75 claim, as you paid for the tickets via credit card.
Donation drive: Lidl is asking customers to drop off new toys and games, which it will then pass on to children that need support in the local area
Hit: We are heading into the first Christmas since the cost of living crisis really took hold, and unfortunately it looks as if it is going to be a tough one for some.
So it is pleasing to see businesses stepping up their support for those struggling.
Lidl, which has prospered during the pandemic and cost of living crisis, has launched a new, nationwide toy donation drive across its stores, in partnership with the charity Neighbourly.
Customers will be able to drop off new and unopened toys and games, to be gifted to children that need support in their local area.
The supermarket said toys were the second most-needed item among the charities it worked with, after food.
Donations can be anything – from a small stocking filler to something bigger. Sought-after items include toys, games, books, puzzles and arts and crafts, for a range of ages.
A great way to spread a bit of Christmas cheer.
