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28 Jan 2009 06:00
A reader complained recently that a debit order had been erroneously taken from his bank account. When he complained to the bank he was told that it could not prevent further debits and he should close his account and open a new one.
The staff member did not offer to try and reverse the debit order or to recover the amount withdrawn.
It may come as a surprise to many bank customers who have had similar experiences with their banks that they have the right to reverse a debit order and that they can implement a stop-payment instruction against a debit order for a period of time.
Advocate John Simpson from the Ombudsman for Banking Services office says the rules around debit orders are quite clear, but they find that what happens in practice is not always the same.
As consumers we need to ensure that we know our rights and to challenge banks when they fail to deliver.
These are the rules banks need to adhere to, according to the Ombudsman for Banking Services:
According to the ombudsman, the banks have introduced a process to identify those companies who have not conformed to the rules of the debit order system. These companies would then be disqualified from further use of this facility.
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