Topic: Lloyds Bank Account Forcibly Closed - page 2. (Read 13712 times)

One thing that can happen is that that the bank that kicks you out can flag your file with the self appointed guardians Equifax and Experian - effectively blocking you from access to banking.

Do people get denied from opening a bank? I always thought the bank wants anyone and everyone to further their profit margin.

The commercial reason is probably simply that they've got a certain proportion of customers whose transactions result in them getting it in the neck from some regulatory authority and having to waste a load of expensive people's time dealing with it, and they don't always know in advance which people these will be. It's cheaper for them overall just to use a few approximate criteria, applicable by fairly low-skilled people, to weed out anyone who looks like they might end up being one of those people and sacrifice their revenue, in exchange for less expensive trouble.

In theory I suppose they could apply special "flagged as a potential troublemaker rates" and charge you more for the privilege of banking with them to make up for the trouble that you might possibly cause them in the future, but that would end up costing them more to administer than it brought in, and probably wouldn't produce a wonderfully productive customer relationship with you.

Obviously the upshot is that all kinds of people get denied banking services for no good reason, which is one of the reasons we need bitcoin...

Yeah reason I left llyods was this one of my friends had their bank closed for trading Bitcoin so I moved. they are losing a lot of business esepecialy because people who are involved with Bitcoin normally bring in good money for them.

If a bank gets any notion of you using bitcoin, they might shut down your account. I have experienced this personally. Open a new one, do it at a smaller branch too. They seem to be easier to work with. And tell your wife it is okay! Just a bank account...don't think this reflects on credit.

Just to update on my previous posts on this subject:

My account was forcibly closed by Lloyds on Friday - without warning! Although they claimed to have sent me a letter a month ago, which is very convenient. They closed all my accounts, my main current account, and the cash account I used for LocalBitcoins. This was a nightmare scenario because they cancelled my cards and everything.

To offer some context, my earnings are well into 6 figures, and the account is never overdrawn. I'm a little concerned that I have a large mortgage with the Halifax, which is part of the same banking group.

Unlike the OP, I didn't plead for mercy. I demanded £1000 in cash and a bankers draft for the remaining balance. I walked straight out of Lloyds and into HSBC and opened an account there.

Lloyds? Muppets!

I think everyone is reading too much into it.. Having a client with overdrawn accounts, even if it's "within the allowed amounts" is not good business for a bank... Banks make money off your money (balances and loans) and at least on the surface it appears you are a liability to them, BTC aside..

Indeed. The US has only four parent banking companies and we all saw how that worked out a few years ago. There were over 30 individual banks in the 70's.

So,can you switch to a business account or are you closing that particular account?

What on earth are you talking about? The OP has already made it clear that the overdraft has nothing to do with it (o/d within authorised limit). Banks don't close accounts because they are overdrawn. They make money off them.

That stinks man. I hate how these banks can do whatever they want. They act like its a real wonderful thing that they let you do business with them. Sometimes I wish I could survive with all Cash.

Turn your back on Bitcoin, pledge your allegiance to fiat, and you will be forgiven.

Well after several interviews with different bank managers which felt increasingly like Kafkas "The Trial" (You are accused but we will not tell you what you are accused of or what the consequences will be.) I discovered that I had the right to appeal which I did. The rules of the appeal process, I was told (again, nothing in writing!!)  was that I must take printed documents (no computer records allowed) to my account opening branch in Reading, and show these to the manager there. This I did, returning with further details on a second day. She cross checked a couple of random points from my 100 pages or so of data and then sent it of to the "Closures Committee" in Birmingham.  The decision that came back was that they would not right now close my accounts, so I won the appeal. Even so they were not planning on communicating this to me in writing. The accounts will be reviewed in 3 months time when it can all kick off again, without the right for appeal that time.

There is much that I could say here that seems odd to me. For example at one stage a statement was made much along the lines of "Lloyds bank wants to be a domestic bank, not an international bank"  This seems extraordinary to me when surely if Lloyds is to survive it should be a bank that does what its customers want.  They suggested that HSBC might be better for the type of thing I was doing. Now that, although an informal and off the cuff suggestion, is an interesting one, If you believe the advertising of HSBC then they are the bank that would know and adapt to local conditions.

Another strange comment that was made was that the decision (to close my accounts) was being taken for purely commercial reasons. Now I have always paid all my bank charges. Every day I have made an overseas transfer I have paid the amount they asked me to pay (Usually £17.50) I have also suffered terribly because of Lloyds lousy exchange rates on SEPA transfers. In other words they have set the price of the services they offer and I have chosen to use them, how can they then say that they want to close my account for commercial reasons, it seems like that cannot be true.  If they (for example) lost money on overseas transfers then they should charge me more, but that's their problem not mine!!

Its clear that so far as Lloyds is concerned, a business account is what I need, and would have avoided much of this. But most businesses would have been happy to offer advice about which product their customers should be using but Lloyds it seems do not offer this type of advice. 

I will most likely keep my Lloyds accounts for the moment while opening a new account with a more sympathetic bank. I think with at least one potential bank, perhaps HSBC I shall actually tell them that this is going to be part of what I do and see what they say.

Its been an interesting experience, and at times very frightening, because nobody is telling you what the implications are, but it seems that I could and still can just transfer to another bank so perhaps the answer is that the only implication to be drawn from this is that as a Bank Lloyds are still in the 18th century, after all they have not even understood email or mobile phones or customer use of computers in a way that anyone would regard as sane. What chance do they have with crypto currency?  Hell they missed a fantastic opportunity with paypal (as did all uk banks) to "be" paypal.

See if you can get more information from the bank and come back here if you can and let us know what they say.

i would assume you need a business account to run a bitcoin trading operation?  and they wont give anyone a business account for bitcoin in the UK to my knowledge.

It really truly sucks being broke like that, but I've been broke numerous times in life but I don't recall ever having an overdrawn bank account.  While I see nothing morally wrong with it, I do question why you are making a thread with a baiting title.  It hurts any other point you may have when you have overdrawn your account.  There is simply no way for us to make any sort of judgement on the matter.

I have not read the law in Britain, but in Canada it is only illegal to mention the reporting to FINTRAC if it is likely to impede an investigation. I reported myself to FINTRAC after unsuccessfully trying to open an account (so that disclosing reports would not hinder an investigation). The manager at the Financial Institution still insisted no report was sent.

Personal.

Even when I had money paid fraudulently into my account, they just made me close it and reopen it with a new account number for "security".

I am waiting for the Lloyds complaint procedure to see if that produces anything and then will go to the Financial Ombudsman. My situation sounds very similar to you 5flags. A question: is your Lloyds account abusiness or personal one. So far as I imagine, this is in fact the issue.

I bank with Lloyds, and trade on LocalBitcoins.

I've not had any serious problems with them. They froze an account once when a fraudster bought BTC from me using a stolen bank account, but that's about it. I used to regularly get calls from the branch when I had large sums going in to my account (which were often hundreds of thousands per month) - I even went into the branch to explain what I was doing so they didn't have to call me any more. They never seemed to have a problem.

I don't know how Bittylicious works, is it a similar way?

Have you considered going to the Financial Services Ombudsman?