DD cancelled money still taken

rsl1976

Hi,

I recently cancelled all Dd's on my account as I am no longer working and my husband was going to pay them. However Revenue were still able to take the LPT from my account and so were a car finance company. How is this possible?

Legislator

Did you cancel with the Bank or the Originator. Either way you can still demand a refund of the amounts from your bank.

28064212

Always cancel a direct debit with your bank. Cancelling with your creditor is essentially just asking them nicely to not debit it again, instructions that often get mangled or lost along the way. Cancelling with your bank means they must not pay out that direct debit

As Legislator said, you can get an instant refund (providing it's within 8 weeks of the debit). Make sure you cancel all direct debits with the bank afterwards

rsl1976

Hi

I cancelled them all with the bank. I rang them over the weekend and was told I would have to black list them as SEPA allows for Dd's to be reactivated by the creditor. I'm going in to my bank today

28064212

rsl1976 wrote: »

Hi

I cancelled them all with the bank. I rang them over the weekend and was told I would have to black list them as SEPA allows for Dd's to be reactivated by the creditor. I'm going in to my bank today

If you're cancelling all direct debits, just tell them to switch them off for your account. From IPSO:

SEPA Consumer (Debtor) Rights

• Use your account to pay a SEPA Direct Debit in any SEPA country
• Instruct your bank to refuse a Direct Debit
• Prohibit the application of any Direct Debits to your bank accounts
• From 1st February 2014 you can specify Creditors who may collect Direct Debits from your bank accounts
• From 1st February 2014 you can specify Creditors who may not collect Direct Debits from your bank accounts
• ...

If you only cancel a specific direct debit, the creditor can create a new one (although they're not supposed to, since they're required to have a signed mandate for that relationship). If you blacklist that creditor, other creditors can still collect. Either prohibiting all direct debits, or whitelisting if you have a couple you want to allow, is the best option.

BazzaDP

Why are people always so antagonistic about DDs? You gave permission to the company to remove the DD so why wouldn't you just phone them to let them know you don't wish to pay by DD anymore and instead let the collection fail and all the consequences of that? If you want to cancel at the bank as well to be sure then that I can understand but personally I would at least try and inform the originator.

Anyway, there's a few points and misconceptions here.

First of all if you cancel a DD then the originator cannot collect, however they will not usually be informed it's cancelled until the next time they collect. So if this is the first collection after you cancelled then it sounds like your bank has failed to cancel it properly, rather than that the originator has decided to set up a new DD. If the DD failed but the originator just set it up again and collected the next month then that's a different story (though this can also be confused with the next point below).

Secondly there are a few things that could be seen as "cancelling a DD": 1) Cancel a specific collection on a DD, 2) cancel all future collections on a DD, 3) Ask for a refund on a DD, 4) block all future DDs for that company. 4 is the most drastic obviously but be careful you never want to set up a DD for that company again as whether the banks can undo such a request in the future remains to be seen. Anyway you need to be clear that whichever you have requested is what the bank has done.

Thirdly DDs are sent to the bank at least 3 days in advance. Depending on exactly when you cancel the DD at the bank, and how long it takes them to process that rejection, the latest DD may still be processed. In theory customers should be able to cancel until just before it's collected but these things do take time so not sure what lead time different banks require.

And finally, as I've stated on other posts, cancelling a DD doesn't mean you don't owe the money. Just that you don't want to pay the money you owe by DD. This may have other impacts - e.g. It may mean you're no longer entitled to a DD discount, so again I'd encourage people to speak to the originator they set the DD up with to find out the full impact.

Given all that, if you are very close to a collection date, and plan to pay by another way anyway (like the OP here) then, it may be easy to let this one last DD go through rather than live with the uncertainty of whether the cancellation has gone through or not.

Fred Swanson

This post has been deleted.

BazzaDP

Fred Swanson wrote: »

People don't trust them. They give an originator licence to empty a bank account at a whim.

I have cancelled all DD's on my account and set my account to not accept any future DDs. Suits me fine.

Fine, then don't set them up in the first place! Personally I find them handy and that, coupled with the refund process under SEPA, think the risks are minimal and the convenience is high.

rsl1976

Thanks for the advice everyone. Went into the bank today and apparently it's happening more often with SEPA. I just couldn't understand how some were still able to go through when all others hadn't. I had informed the car finance company and they were due to send out new direct debit forms. They only wrote to us last month to say they were unable to take the car payments since SEPA came in and would have to set up a new DD which is when we told them to send us out the new forms. Now i know i should have noticed the money wasn't going out but i didn't (which is probably why my husband wants his own account) but i was terrified they would look for all the money together. Anyway all sorted now

Legislator

Fred Swanson wrote: »

This post has been deleted.

Originators cannot empty bank account on a whim and there is no evidence to support such a statement
The consumer has never been better protected when paying by direct debit.

28064212

Legislator wrote: »

Originators cannot empty bank account on a whim and there is no evidence to support such a statement

Of course they can (well, up to certain limits, depending on the bank and originator). That's what a direct debit means: that the originator decides how much to debit.

Legislator

28064212 wrote: »

Of course they can (well, up to certain limits, depending on the bank and originator). That's what a direct debit means: that the originator decides how much to debit.

The originator must advise you in advance of the amount and the debtor can instruct his bank to refuse the particular DD if they disagree with the amount or if they are in dispute with the Originator.

28064212

Legislator wrote: »

The originator must advise you in advance of the amount and the debtor can instruct his bank to refuse the particular DD if they disagree with the amount or if they are in dispute with the Originator.

Should advise you. There is no verification done by the bank. There is no punishment of the company if they don't notify you. At best, you could put in a complaint to IPSO, but that's been shown to be completely ineffective (see some of the threads on the topic in the UPC forum).

The SEPA process has improved things, but there is still very little in the way of penalties for creditors who don't follow it.