Woman's life in chaos after bank declares her dead

Alison Lattimer

A woman's life was turned upside down after M&S Bank got the idea she was dead - and even insisted to the Post Office that this was the case.

Northumberland woman Alison Lattimer had her credit card and all her standing orders and direct debits cancelled by the bank, after it wrongly added a note to her account saying she was deceased.

This meant that the 56-year-old's home and car insurance policies were voided, and she was given automatic refunds on her gym membership and contact lenses. Her salary payments, council tax, energy bills and Sky TV were also cancelled.

Her debit card was first declined and then swallowed by an ATM.

The Post Office cancelled her home insurance and even sent her family a letter of condolence. Even after she phoned and explained that she was very much alive, the policy was cancelled for a second time.

Mrs Lattimer says the experience has left her on the brink of a breakdown. "It was a horrible time, I would not like to go through it again," she told the Northumberland Chronicle.

The trouble began when Mrs Lattimer, a technology analyst, called in at the M&S Bank at Intu Metrocentre in Gateshead in June in order to transfer the account she held with TSB.
However, instead of processing the transfer correctly, the bank added the 'deceased' note to her account.

The bank has now apologised, reimbursed Mrs Lattimer for her losses, and paid an undisclosed sum in compensation. It says it's working to put all her standing orders and direct debits back in place, although she'll have to reinstate some of them herself.

But the chaos caused by the error shows just how much we depend on our banks - and this is by no means the first time this has happened.

In May, for example, Julia Welch, from Totnes in Devon, received a letter from Tesco Bank asking for her next of kin to post her death certificate and last will and testament. Her children found the letter, and feared that their mother was dying.

Meanwhile, Lloyds customer Ashley Flynn was also told he was dead by his bank, leaving him locked out of his bank account. His credit rating vanished, and he was unable to get a mortgage in his own name.

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Woman's life in chaos after bank declares her dead

More than 46,000 of 106,000 the complaints received by the FOS in the second half of last year related to payment protection insurance (PPI). And the organisation is expecting to receive a record 165,000 PPI complaints in 2012/2013.

The huge numbers are due to the PPI mis-selling scandal that should now be a thing of the past, but there is no doubt that the insurance, which can add thousands to the cost of a loan, is highly unpopular!

(Pictured: Martin Lewis after the PPI payout ruling)

Complaints about mortgages jumped by 38% in the last six months of last year, the FOS figures show, compared to an increase of just 5% in investment-related complaints.

Common gripes about mortgages include the exit penalties imposed should you want to sell up or change you mortgage before a fixed or discounted deal comes to an end, and the high arrangement fees charged by many lenders.

While there is nothing in the data released by the FOS about the number of complaints relating to savings accounts, hard-pressed savers have been struggling with low interest rates for several years now.

You can get up to 3.10% with Santander's easy-access eSaver account, but many older accounts are paying 1.00% or less and even this market-leading offer includes a 12-month bonus of 2.60% - meaning that the rate will plummet to just 0.50% after the first year.

Banks are imposing the highest authorised overdraft interest rates since records began, with today's borrowers paying an average of 19.47%, according to the Bank of England.

A typical Briton with an overdraft of £1,000 is therefore forking out around £200 in interest charges alone. Coupled with meagre returns on savings, it's enough to make your blood boil!

While authorised overdrafts may seem expensive, going into the red without permission will cost you even more due to huge penalty fees.

Barclays, for example, charges £8 (up to a maximum of £40 a day) each time that there is not enough money in your account to cover a payment.

If you need to send money abroad, the likelihood is that your bank will impose transfer charges - and offer you a poor rate of exchange. Someone transferring a five-figure sum could easily lose out by £500 or more as a result.

The good news, however, is that you can often get a better deal by using a currency specialist such as Moneycorp.

Automated telephone banking systems, not to mention call centres in far-flung parts of the world, are one of our top gripes - especially as we often encounter them when we are already calling to report a problem.

In the words of one disgruntled customer: "What is it about telephone banking that turns me into Victor Meldrew? Well, maybe it's the fourteen security questions, maybe it's the range of products that they try to push or maybe it's because I'm forced to listen to jazz funk at full volume while my phone bill soars.

"Actually though, I think it's because the people I eventually speak to rarely seem able to solve the issue I'm calling about."

The days of a personal relationship with your bank manager are long gone - for the huge majority of us at least.

When ethical Triodos Bank investigated recently why around 9 million Britons would not recommend their banks to a friend or relative, it found that almost a third felt they were not treated as individuals. Another 40%, meanwhile, were simply disappointed with the customer service they received.

When you're in a rush, the last thing you want to do is wait in a long queue at your local branch.

Researchers at consumer champion Which? recently found that most people get seen within 12 minutes, but you could have a much longer wait if you go in at a busy time. Frustrating stuff!

The Triodos Bank research also indicated that the bonus culture that ensured the bank's high-flying employees received large salaries, even when it was making a loss at the taxpayer's expense, was hugely unpopular with consumers.

About a quarter of those who would not recommend their current banks said this was the main reason why. And with RBS executives sharing a £785 million bonus pool despite the bank, which is 82% publicly owned, making a loss of £2 billion last year, it's not hard to see why.

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