In January 1993, RR opened an account in her name with a bank in the United Kingdom. The opening balance was £1000. In September 1997, the bank closed RR’s account and transferred the funds to another account. At the time, RR was unwell and did not quite understand what had happened.
In 2006, her brother, Mr UR, returned from Australia to take care of RR.. He tried to take stock of RR’s deposits and investments and came across this bank account. Mr UR wrote to the bank on several occasions as to the whereabouts of the funds. RR contended all along that she had never authorised the bank to close the account. Given the fact that the account closure happened many years back, the bank had quite a difficulty in trying to access information on its system. Worth noting is that in the meantime, the bank had been taken over and new IT systems were deployed.
After some months of waiting, the bank replied that the account into which funds had been deposited had been closed and transferred to another bank in the United Kingdom. Mr UR was not satisfied with the bank’s reply. He also tried eliciting a response from the bank to which his sister’s account had been transferred but, for some reasons, the bank did not give much information except that this second account had also been closed.
Mr UR resorted to MFSA for assistance. Given that the banks involved were located in the United Kingdom, the MFSA did not have jurisdiction to contact these banks directly and referred the case to the Financial Ombudsman Service in the United Kingdom for assistance.
From investigations carried out, it transpired that the branch where RR opened her account in 1993 had been closed and the bank transferred the accounts to another branch. During this process, the bank tried to link account holders of the “closed” branch” with accounts (which might have had the same name) of the other branch.
It so happened that an account holder with the same name as that of RR held an account at the new branch. For unknown reasons, the bank’s system assumed that the persons were the same. To further complicate matters, the account into which funds were deposited was closed some about three months after and all proceeds transferred to another bank. What the bank however failed to notice was that the account holder into which funds had been transferred had a “Dr” preceding her name.
Indeed, when the bank sent copies of the bank statement belonging to this other person, the MFSA noticed (and the UK Ombudsman confirmed) that “Dr RR” and “RR” were not the same person and, essentially, mixed up two customers with the same name.
In light of the circumstances of this complaint, the bank, on the Ombudsman’s recommendation, accepted to reimburse RR with the full amount of the account at the time it was closed, together with interest, simple interest at 8% from 1997 when the account was closed and £400 compensation in light of the inconvenience.