rage against the machine

I know it is futile to rant about banks. I know also that I should not really expect anything other than crap service from an industry that treats its customers as useful idiots. But yesterday I met with such appalling and unforgiveable stupidity and intransigence that I feel the need to rant here. I have left a period of 24 hours between the experience and the rant simply to allow myself time to reflect, shout at the cats and explain my frustration to my wife in the (vain) belief that it might actually be me at fault rather than the banks (I am, at heart, an eternal optimist).

Here is what happened.

Recently I was reviewing my meagre savings because the laughably small interest rate on one of my ISAs had been reduced following the ending of a “bonus period”. Great scam this. Offer a rate say 0.5% higher than that offered by competitors but limit it to a fixed period. Thereafter, drop the rate to (say) 1.0% below your competitors’ offerings. Better still, lock your customer into the agreement for a period (say) two years longer than the initial “high rate” period. We all fall for this, yet in my view it should be outlawed because it takes advantage of those least able to care for themselves – i.e people who do not actively manage their savings. Such people are often elderly, or infirm, and perhaps confused by the finance sector (who isn’t?). Some people are taken in simply because they naively believe that, as long term, loyal, customers they will be treated as such by their bank.

Following my latest review I noted that one of my ISA accounts (I have several, largely as a result of the aforementioned bank policy of varying introductory rates) was paying 3.0% when the one with the now lapsed introductory rate was paying only 2.0% (now to be reduced even further to 1.5% from 1 February this year). On the face of it would seem to be a no-brainer to move the funds in the lower paying account to the one paying the higher rate. But ISA investment is complicated by the need to make 2-3 year decisions now based on current rates when rates may rise later this year and by the fact that you are limited to a fixed maximum investment sum in any one financial year and in any one ISA. Decisions are further complicated by the policy of some banks to refuse transfers in from other (previous year) ISAs and the fact that some ISAs do not allow any withdrawals or indeed transfers out. Little wonder that “inertia” means that they get to keep your money at rates as low as a derisory 0.1% per annum. I kid you not. My wife was getting this from Barclays up until last year when I found out and stood over her whilst she completed the forms to move her cash. My wife is in the “loyal customer” camp.

So, do I move funds now in order to gain 1.0% or wait six months (when rates may have moved and we will in any case be in a new F/Y and sparkly new ISAs with fresh introductory carrots will be in place)? Tough call, but the fact the rate differential was set to rise to 1.5% in February, coupled with the fact that the Halifax (let’s name and shame) on-line banking system said that I could transfer in the ISA in question to their ISA paying 3.00% convinced me to start the process.

Big mistake.

On starting the transfer I checked, and double checked, that the account I was transferring into was the one offering the 3.0% rate. It was. The account number and sort-code matched. On completion of the process, the system even gave me a nice “Thank you for transferring into your cash ISA” page to print which summarised the action I was authorising (“from” account detail, “to” account detail, amount of transfer, National Insurance No. etc). A couple of days later I noted that funds had disappeared from the “from” account so I knew the process must have started. I checked several times over the next week to see if the funds had been added to my Halifax account but was not overly worried that it had not because the Halifax does explain that the process can take up to 15 days, but that they will credit interest to the account for the full sum transferred from the date of application (the “Halifax ISA promise“). Well, I wasn’t worried until I received a letter from the Halifax saying that they could not complete the process of opening my account until I had provided information to verify my identity. Note that this letter confirmed the account details as being the existing ISA I hold with them. The letter concluded by saying that I should “call into any of our branches to confirm” the identity information requested. It also said that if I had any questions I should call a telephone number provided.

I have several accounts with the Halifax, including a mortgage account, but not a current account. My first mortgage in 1977 was with the Halifax. The Halifax has confirmed my identity often, and indeed fairly recently since the ISA in question was opened only one year ago. My nearest Halifax branch is a round trip of 25 miles away. I was at the time feeling pretty grumpy and in no mood to make an unnecessary 25 mile round trip to go through yet another identity check when I could call them to sort out the issue. (I should add as background here that I suffer from both arthritis and a form of inflammatory arthritis commonly known as gout. At the time I received the letter I was suffering from a gout attack. The normal treatment for pain relief in gout is NSAIDs such as aspirin, ibuprofen or diclofenac. I can’t take any of those pain killers because I am allergic to the damned things. The main drug prescribed for relief of gout inflammation is called colchicine. Colchicine has an interesting set of side effects (look them up). Now figure out why I was grumpy and disinclined to make an unnecessary 25 mile round trip.)

I called the 0845 number only to be greeted by the monumental stupidity of one of those automated systems which requires entry of a specific type of number before it will take you any further. Such systems seem to have been designed specifically to wind you up to the stage that you give up and go away. Mistakes numbers 1 and 2 here are 1, refer customers to such a number on a letter which says “call here if you wish to discuss any questions arising from this letter” and 2, assume that all callers to this number will have current accounts and thus possess the magic number required to use the system successfully. Eventually, however, through persistence, I got to a human being. The human being in question appeared to be a nice helpful young man in a call centre. Unfortunately after listening to my explanation as to why I was calling, the NHYM in question said he was “not trained to answer” my particular question. I know that such calls are recorded, but I found the precise wording he used rather odd, obviously part of a script he was forced to follow in certain cases. I guess that there are certain key phrases which must be used in all transactions for regulatory reasons. As an aside, I find it sad that even in the situation where you do eventually get to speak to a human being after going through a brain dead automated process, that human being is then forced to act and speak like an automaton.

NHYM number one then passed me back to the automated system whilst reassuring me that he was actually passing me to a colleague who would be able to respond to my particular problem. Whilst I was on hold, the automated system asked me if I was aware that I could get nearly all my questions answered by going on-line to the Halifax web site. Mistake number 3 lies in assuming that anyone who prefers to talk to a human being on a telephone is remotely interested in (or maybe even capable of) using a web service. Those people who have got to the telephone are either web users who have found that the site does /not/ meet their requirements or they are people who actively prefer not to use a website. Referring either group to the web is thus both counter productive and irritating.

Having been on hold for a short period and having ignored all requests to press button “X” or “Y” I was again eventually connected to a (different) NHYM in a call centre. I then again explained my situation: viz. I had received a letter asking me to schlepp up to my nearest Halifax in order to provide documentary proof that I was the same bloke who had opened a particular ISA one year ago. I pointed out that the Halifax knew who I was from previous encounters (I listed various accounts in evidence) and that it should be relatively easy to confirm this on the telephone – hence my call. NHYM number two then took me through various “security questions” which will be familiar to anyone who has a UK bank account (give full name, confirm first line of address and post code, give balance of account in question, give National Insurance Number (it is an ISA), state date of birth). Having done all this, NHYM number two then thanked me and said that he would arrange for me to receive an identifying number which I could use in future telephone banking interactions which would prevent me having to go through this rigmarole all over again. However, he said, I would still have to go into my nearest Halifax branch to prove my identity because this is a “legal requirement” and part of “our know your customer programme”.

I confess that by this time my patience was stretched a little thin and I may have been somewhat abrupt with the NHYM in expressing both my incredulity that this should still be necessary and my intense irritation that the Halifax should assume it OK to insist on my travelling to them when I have already been through the necessary hoops more than once. I pointed out that I had just gone through the process of proving I was who I said I was to his satisfaction in order to meet their security requirements. I also pointed out that for all he knew, I could be a disabled old man incapable of leaving his home without assistance (not actually true, but not so far from the truth) and that it was therefore a little unreasonable to expect me to do so. NHYM sympathised, said that he would pass on my complaint, but felt obliged to point out that any formal complaint would not be upheld because Halifax was merely obeying its legal obligations to identify its customers and the source of their funds. (I know for a fact that this is utter bollocks and that banks choose how they should meet their obligations under money laundering regulations, but I did not feel that this would be a fruitful line to take with the NHYM so I limited myself to forcefully asking him to lodge my complaint). Before concluding our conversation, I apologised to the NHYM for venting my frustration upon him and told him that I realised that he was following instructions in a difficult job and that he was in no way to feel himself at fault for the failings of his employer and its systems.

I then made the trip to my nearest Halifax. Before going however, I decided that I should take the opportunity of the visit to close an old branch book based savings account I hold as trustee for one of my grandsons and transfer the balance to a newer account I hold elsewhere which offers a much better rate (they play the same “bonus interest rate” trick on poor defenceless children.)

On arrival I was greeted by a NHYL who listened to my story and then told me that what I had described could not possibly have happened because I was not allowed to transfer in new funds to an existing fixed rate ISA account. What I must have done (according to her) was to open a new ISA and request transfer of funds into that. I showed her the documentary evidence refuting this statement and also pointed out that the money had obviously been requested by the Halifax because it had left my other account about a week ago, NHYL again said that this was not possible because the Halifax would not request the funds until the account had been set up. The fact that the letter I held in my hand said that the account could not be opened until they had verified my identity proved that the account had not yet been set up. I pointed to the account number and pointed out that this number was my existing ISA account which was already open, so perhaps the Halifax had requested the funds in order to place them in my existing account. Again, NHYL said this was impossible. I then asked where my money was because it clearly was not in my other account and the Halifax appeared not to have it. She proved unable to answer this and suggested that I check with my other bankers as to what they had done with the money. So I trotted (slowly) up the road to the other bank and spoke to yet another NHYL (though this one actually /was/ helpful). Apparently, despite the Halifax NHYL’s protestations to the contrary, the Halifax had requested transfer of my ISA funds almost immediately. My bankers had simply responded as they were expected to do and passed the money on. On hearing my full story, and learning that I did not now wish to pass my funds to the Halifax (old account or not) NHYL number two spoke to her colleagues in the bank’s ISA section and confirmed that once the funds were returned to them (as they would have to be if the account opening process was not completed) my old ISA would be re-instated.

I thanked the helpful lady and made my way back to the Halifax where I updated the Halifax version of the NHYL on the position. Whilst there I also asked how I should go about closing my grandson’s account. I was directed to the counter. At the counter I entered what appeared to be yet another banking bubble divorced from reality. My request to close the account and let me have a cheque made out in my grandson’s name was greeted with the response that it would not be possible to provide a cheque for a sum less than £500.00. I was offered cash. I said that I would prefer not to take cash because (bizarre as it may sound) I knew that the bank holding my grandson’s account did not accept cash, dealing only in cheques. (Sometimes I despair). I then asked if the cashier could just transfer the balance of the account to my grandson’s other account and then close the old account. Reader, you will not be surprised to learn that this proved impossible.

I took the cash and left.

As I said at the start of this rant, I really should know better. Despite all the (supposed) huge investment in technology in our banking systems, systems which we rely upon in ways which are deeply fundamental to our society, those systems consistently fail to meet quite simple needs. Frankly, this terrifies me.

Note carefully that all of the problems relating to my ISA transfer described above could have been prevented very simply. All that was necessary was a check in the on-line system which should have popped up a warning when I attempted to transfer funds saying “Sorry, you cannot transfer funds into this account. Do you wish to open a new ISA?”

To which my answer would have been: “No”.

*** Update dated 13 February 2014

Following this post and my discussion with the NHYM in the call centre I had three ‘phone calls and a few exchanges of email with Halifax Customer Relations Department. In the interests of balance and fairness to Halifax I should report:

  • They tried hard to understand my problem, why I was complaining and what I expected them to do as a result.
  • Having fully grasped the nature of my complaint, they promised to take on board the issue of the failure of their on-line systems to properly check my account details and attempt to fix that for the future.
  • They offered financial compensation for my expenses in travelling to a Halifax branch, loss of interest on the ISA account whilst my money was between banks, and a goodwill payment for “upset and frustration caused”.

I am grateful to them for taking the issue seriously.

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