Direct Debit clawbacks

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littleFred
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Direct Debit clawbacks

Postby littleFred » Sat Jan 07, 2017 1:08 am

The previous direct debit thread went off-track, so here's a new one.

GOOFy Eric19 claims success at clawing back DDs for "credit cards, loans and one mortgage (on the house that we've sold 3 years ago)". Now, he is trying to stop them from clawing back the clawbacks.

Eric19 has the same fondness as Baron David Ward for wet ink signatures:
Eric19 wrote:... there is a requirement that any formal agreement is formally signed in wet ink by an authorised officer of the Company by the title of Sainsbury’s.

And J Smith is required to produce the wet-ink signed agreement:
Eric19 wrote:That there is a formal requirement for Mr J. Smith in the position of director of collections and recoveries for Sainsbury’s to present the factual material evidence that there is a formal agreement with consideration in both directions, Full disclosure in the terms and conditions which is formally signed in wet ink by both parties which would be Mr X. YYY and a named and authorised officer of Sainsbury’s.

Eric takes this to the logical-illogical conclusion. If Mr J. Smith can't produce these wet ink agreements then this enters him into an agreement:
Eric19 wrote:Failure for Mr J. Smith in the position of director of collections and recoveries for Sainsbury’s to present the above valid material evidence to support the claims made by Mr J. Smith in the next seven (7) days will enter Mr J. Smith in the position of director of collections and recoveries for Sainsbury’s into a formal and binding agreement between Mr J. Smith and Mr X. YYY to the following effect.

Which is it, Eric? Agreements require wet ink signatures, or agreements can be foisted when one side doesn't do what the other side asks for?

If agreements can be foisted, then the original agreement doesn't need to be signed, and your conditions for foisting an agreement are not met.

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Re: Direct Debit clawbacks

Postby TheNewSaint » Sat Jan 07, 2017 2:00 am

I think the FMOTLs really found a soft spot with these direct debit clawbacks. It seems you don't need much justification to get one. Then the defrauded company has to expend resources trying to get the money back. I'm sure a lot of these losses will be written off as not worth litigating, and never be recovered.

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Re: Direct Debit clawbacks

Postby notorial dissent » Sat Jan 07, 2017 3:01 am

I really think they should be filing criminal fraud, which is exactly what it is, charges and forcing the authorities to prosecute and that would very quickly put a stop to it.
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Re: Direct Debit clawbacks

Postby Firthy2002 » Sat Jan 07, 2017 3:42 pm

Some companies will be more dogged than others about it or happy to pass it over to a DCA. As I mentioned in the previous thread, Sky are one such company.
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Re: Direct Debit clawbacks

Postby Hercule Parrot » Sat Jan 07, 2017 7:34 pm

littleFred wrote:Eric19 has the same fondness as Baron David Ward for wet ink signatures:

I think he's very largely copying Baron TrampBeard's methodology. The lengthy, tendentious and repetitive tracts littered with familiar, hyperbolic claims about terrorism etc.

I'm in two minds about this DD Clawback thing, to be honest. I personally think that the banks and creditors should make a point of crucifying a few of the fraudulent claimants, to send out a message. Or they should refuse the clawback request and dare the 'customer' to go to court with their claim. But if they don't bother to pursue the sums which have been stolen by Eric19 and his pals, then it frankly serves them right if other people start jumping on the bandwagon.

Someone might say that those costs will be borne by higher charges to their honest customers, and that's probably true if their honest customers remain loyal. But I don't trust any bank or energy supplier, insurance company etc to look after my best interests, and I will happily move my business to a cheaper supplier at renewal time.

Morally though, I would still prefer to see dishonesty being challenged and punished.
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Re: Direct Debit clawbacks

Postby littleFred » Sat Jan 07, 2017 7:47 pm

I wouldn't be surprised if Eric19 is the Baron.

It is dishonest. I suspect it might be fraud, legally.

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Re: Direct Debit clawbacks

Postby longdog » Tue Jan 10, 2017 1:14 pm

littleFred wrote:I wouldn't be surprised if Eric19 is the Baron.

It is dishonest. I suspect it might be fraud, legally.


The usual IANAL provisos aside I'm damn sure it is. It's obtaining money or the goods or services that were bought with the DD by deception.

The DD guarantee says that payments can be reclaimed if there has been an error. If the money is reclaimed where there has been no error and the person knows this that's fraud.
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Re: Direct Debit clawbacks

Postby noblepa » Wed Jan 11, 2017 4:22 pm

From reading these discussions, I get the impression that a clawback is easier in the UK than it is in the US.

Once, a long time ago (1978), in a galaxy far away (San Diego), I saw a charge on my credit card bill that I didn't remember. I called the cc company and disputed the charge. I believe that they provisionally refunded the money. A week or so later, I got a nice letter, along with a photocopy of the receipt I had signed. The letter explained that the vendor had provided this evidence that I had, indeed, made the purchase in question. Sheepishly, I had to admit that I had and I let the matter drop, as I was clearly in the wrong.

My point is that, the cc company didn't simply take my word for it. The vendor was given the opportunity to prove the charge (which he did in this case). The cc company then immediately restored the charge to my account.

It seems like the banks in the UK are more liberal; they seem to allow the clawback and let the buyer and seller settle the matter on their own. That seems to be unduly harsh for the banks. Is that the way the law reads, or are the banks simply being lenient?

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Re: Direct Debit clawbacks

Postby aesmith » Wed Jan 11, 2017 5:49 pm

I think the banks are being overly lenien. The intent of the DD guarantee is to protect against a mistake in taking the payment, or in the process. For example taking a payment twice, taking a payment that hadn't been notified in advance, or was a different value to that notification. It specifically says (somewhere) that it's not intended to be used if there's a dispute with the supplier.

https://www.directdebit.co.uk/DirectDeb ... antee.aspx
https://www.directdebit.co.uk/DirectDeb ... ments.aspx

"The Guarantee covers Direct Debit payments. It cannot be used to address contractual disputes between you and the billing organisation.​"

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Re: Direct Debit clawbacks

Postby doublelong » Wed Jan 11, 2017 7:30 pm

aesmith wrote:I think the banks are being overly lenien. The intent of the DD guarantee is to protect against a mistake in taking the payment, or in the process. For example taking a payment twice, taking a payment that hadn't been notified in advance, or was a different value to that notification. It specifically says (somewhere) that it's not intended to be used if there's a dispute with the supplier.

https://www.directdebit.co.uk/DirectDeb ... antee.aspx
https://www.directdebit.co.uk/DirectDeb ... ments.aspx

"The Guarantee covers Direct Debit payments. It cannot be used to address contractual disputes between you and the billing organisation.​"

You are correct but if you check out the so called advice that goofy and the like give about claiming back DD they tell you to tell the bank that there has been an error in the amount taken be it more money or extra payments. There is or was a thread on goofy where somebody was complaining that their bank had refused to entertain their clawback because they said it was over a dispute and not specifically an error in payments taken. I remember it because Jimmy jumped in and pointed this out and told them to do it again a week or so later. Basically they don’t even have to prove to the bank that a company who is taking £30 a month should have been taking £20, the banks hands are tied and it makes the entire DD invalid and they get all money back.
I have done this myself, in 2007 my old car insurance company did an Auto renewal of the policy without informing me. It turned out I was paying for 2 insurance policies on the same car. The old insurance company told me there was nothing I could do and I would not be getting a refund. I rang my bank and by end of day I had 7 payments of £42 in my account.

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Re: Direct Debit clawbacks

Postby aesmith » Wed Jan 11, 2017 8:50 pm

doublelong wrote:You are correct but if you check out the so called advice that goofy and the like give about claiming back DD they tell you to tell the bank that there has been an error in the amount taken be it more money or extra payments.

Essentially the Goofies are advising people to lie.

I must say my only first hand dealing was when for whatever reason I paid a credit card off by bank transfer, only to have them take the amount again by DD. They told me to claw back via the bank, which I thought was a fob off but in fact the bank did so right away, but did ask me to explain exactly what the issue was.

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Re: Direct Debit clawbacks

Postby notorial dissent » Wed Jan 11, 2017 9:36 pm

I think what they are advising goes well beyond lying, they are counseling out and out fraud, there just isn't any other way to look at it.
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Re: Direct Debit clawbacks

Postby NYGman » Wed Jan 11, 2017 10:15 pm

They advise to just keep saying there is an error, and not to go into any detail, Just say there is an error, and that they want to take advantage of the DD guarantee.
They also at one point at least, had a script to follow, that usually worked. although there were the odd post of the bank having the audacity to refuse until they had time to research it. I am not going to search GOOFY for this, but I am sure the script is posted somewhere over there
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Re: Direct Debit clawbacks

Postby Hercule Parrot » Wed Jan 11, 2017 10:32 pm

notorial dissent wrote:I think what they are advising goes well beyond lying, they are counseling out and out fraud, there just isn't any other way to look at it.

Yes, and it would be nice to see a couple of criminal convictions pour encourager les autres....
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Re: Direct Debit clawbacks

Postby TheNewSaint » Wed Jan 11, 2017 11:02 pm

NYGman wrote:They also at one point at least, had a script to follow, that usually worked. although there were the odd post of the bank having the audacity to refuse until they had time to research it. I am not going to search GOOFY for this, but I am sure the script is posted somewhere over there


There was this, from earlier thread viewtopic.php?f=52&t=11229&p=235540&#p235243

This is a scripted phone call to have with them

You need to keep it simple, don't over complicate it.

The rules are very simple "if there is an error, you have a right under the guarantee to claw back" ITS THAT SIMPLE.

"Keep it simple stupid" it should go like this....

I'd like to make a DD indemnity claim

What’s the problem?

There were errors in the amounts that should have been taken and it looks like there’s errors on all of the payments

What should the amount have been? (this is to trick you into agreeing to pay the amount you say it should have been!!!)

Not the amount taken, I'd like to claw all of the payments back from the very beginning

We only go back 2 / 6 years

No, the DD guarantee scheme has no time limit and no amount limit so I'd like to claw back all payments from that originator / Alternatively: Oh ok, that’s fine as I want to go back …. (however) many years

Can you give me full details about your complaint

With respect it’s of no concern to you, it is highly likely that this will go litigious and if we get into the why's and wherefores then I will have to call you as a witness in the case and I'm sure you would not want that, would you?

We will have to contact the originator before paying the money back

No you don't, you are obligated to pay the money back into my account within 48 hours, please keep to the terms of the guarantee

I will need to know what the complaint is

There are errors in the amounts taken, that’s all you need to know.

Now if they refuse your clawback for whatever reason, just say I don't believe that's correct so I would like to speak to your SME - Subject Matter Expert - who'll invariably be the persons supervisor. Likely she will put you on hold for couple of minutes then come back and say yay ok you can have it or she'll put you through to the SME

If SME won't budge, highly unlikely, then it's them you need to mention ombudsman to as the call handler won't care but she will as banks are automatically fined £350 for each case.


Though I still doubt that approach would be effective. It's combative, suspicious, and requires low-level phone agents to make decisions beyond their power.

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Re: Direct Debit clawbacks

Postby Jeffrey » Wed Jan 11, 2017 11:08 pm

I'll waive the fifth and self incriminate myself. I once tried to clawback a recurring subscription fee that I forgot to cancel, either Hulu or Netflix. Bank denied the clawback and then the vendor refused to give me a refund even though I never used the service.

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Re: Direct Debit clawbacks

Postby doublelong » Wed Jan 11, 2017 11:25 pm

notorial dissent wrote:I think what they are advising goes well beyond lying, they are counseling out and out fraud, there just isn't any other way to look at it.

Also as I understand it you could also be liable for any costs the bank may incur as a direct result of making a fraudulent claim. Something about the indemnity part in direct debit indemnity claim I believe.

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Re: Direct Debit clawbacks

Postby Arthur Rubin » Thu Jan 12, 2017 7:55 pm

Jeffrey wrote:I'll waive the fifth and self incriminate myself.
It's only the fifth in the US, and the DD clawback law is in the UK. :naughty:
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Re: Direct Debit clawbacks

Postby Forsyth » Thu Jan 12, 2017 8:35 pm

noblepa wrote:It seems like the banks in the UK are more liberal; they seem to allow the clawback and let the buyer and seller settle the matter on their own. That seems to be unduly harsh for the banks. Is that the way the law reads, or are the banks simply being lenient?

The UK is quite different from the US in both credit card charge backs and the direct debit guarantee. For direct debits, there was a major hurdle to be overcome in that setting these up is remarkably easy and the guarantee was a way to reassure people that they would not be out of pocket if something did go wrong. Direct debits are now widely accepted by the public and it is not surprising to see some pushing back from the banks in the form of a more strict interpretation of the guarantee.

With credit cards there was an interesting case many years ago. From memory, the credit card companies claimed that they effectively lent the money to the consumer who then contracted with the seller for the goods or service. The court ruled instead that the credit card company effectively provided finance specifically for the goods/service, making them jointly liable in the event that anything went wrong - including claiming a full refund from the credit card company if the seller went bust with no assets. While this was not the result the credit card companies sought, it had the effect of driving people to use credit cards over other forms of payment to take advantage of the additional security. The credit card companies increased their costs to cover the loss, but also became much more choosy over who they dealt with which removed some more dubious characters from the marketplace, and so everyone most people were (sort of) happy in the end. Which is about as good as it gets when money is involved.

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Re: Direct Debit clawbacks

Postby Wozzle » Sat Jan 21, 2017 10:11 pm

I had cause to do a legit direct debit claim recently. A company had continued to take a small amount out of my account despite me cancelling the services. The amount was over 3 months and slightly less than £100. However the bank was so easy to get them to process it, they basically were happy when I said it was taken in error, and if I hadn't have caught what they said on the phone were going to pay me back for 3 years instead of 3 months - just like that!

Seems far too easy to me.


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