We successfully fought to get compensation for our client who accrued over £500 in bank charges as a result of change to direct debit details not being correctly updated by their supplier.
The Situation
Our client advised us of a change to their bank account and the necessary Direct Debit Mandate was signed off and submitted to the supplier in question. It was confirmed in writing by the supplier two days later that the new Direct Debit instruction had been accepted.
Three months later, our client contacted us advising that they had received a bank letter regarding unpaid Direct Debits pertaining to the supplier. We immediately contacted the supplier and identified that the new direct debit mandate had not been correctly applied by the supplier. After further investigation, we found the supplier had also attempted to take payment twenty times over the space of three months from the client’s now dormant bank account, on occasion attempts for payment were made multiple times per day, accruing the client well over £500 in unpaid bank charges.
This was excessive and an unnecessarily aggressive approach to debt recovery and no attempt was made to contact the client over this three-month period to advise them of either an overdue payment on their account or of rejected direct debit requests.
Our Approach
We raised a complaint on behalf of our client requesting compensation for the total amount of the bank charges and a gesture of goodwill payment from the supplier. We strongly believed that as the supplier did not behave as a “reasonable and prudent operator” that they breached the terms of their contract with our client.
We advocated for our client by presenting all historic correspondence on the matter, collecting the bank statements from site as supporting evidence, citing where the supplier had breached their terms and conditions, and pursued the supplier for regular progress updates, all while keeping the client informed.
The Solution
The initial response to the complaint was a goodwill gesture of just over £60 and an apology that the updating of the direct debit details had been miscommunicated. After consulting with the client, it was agreed that this was an unacceptable level of compensation and we escalated the complaint with the understanding that if the client did not receive satisfactory compensation then we would escalate it to the Energy Ombudsman, as the client in question met the SME/Microbusiness criteria.
Upon review of the initial remedy, the supplier agreed to further compensate the client’s bank charges and noted them as an avoidable loss caused by the supplier’s bad practice.
