'Unwanted' upgrade to silver account incurred charges



They were only overdrawn by 8p. But that trifling amount has left Angela Hannibal and Wayne Green with more than £1,700 in bank charges – and may even cost them their home.

Miss Hannibal, 21, who has just had a baby, opened a basic current account with Lloyds TSB when she was 15.

When she was 18, that was upgraded to a ‘silver’ account which offered her travel insurance, mobile phone insurance and breakdown cover for an £8 monthly payment.

Money worries: Angela Hannibal and Wayne Green with their two-week old daughter, Ashlyn. The young couple now face losing their home

But in January 2009, after the monthly service charge was taken out, Miss Hannibal was left with an unauthorised overdraft of 8p and was told she would have to pay the bank a charge of £170.



Struggling with bills and rent, the 21-year-old offered to pay the bank back at a rate of £30 a month. But she has had to pay a series of further unauthorised overdraft charges – at about £170 a time.



In total, the couple, whose daughter Ashlyn was born two weeks ago, have repaid £1,000 in instalments. But they still owe £700 – and the debt is rising at a rate of £10 a day.



Miss Hannibal, of Colchester, Essex, said yesterday: ‘Apparently I went 8p overdrawn in January 2009 and since then the charges have just mounted and mounted.



'I was completely shocked when they asked me to pay £170 back. I was scraping around and set up a payment plan and have been using my wages to try and keep up with the payments. It’s led to real financial hardship for us, especially with a new baby.’



Furthermore, Mr Green, 23, was made redundant from his job as a builder in August.

And the couple have been ordered to leave their three-bedroom home because of the rent arrears.

Troubled: Angela and Wayne say they have been hit with more than £1,000 in overdraft charges by Lloyds TSB

Mr Green explained: ‘Because we have been paying so much to Lloyds and now I have lost my job, we have been struggling to keep up our rent and council tax payments.’

But although she was already in debt with the bank, Miss Hannibal said staff offered her a credit card.



The office clerk, who earns about £950 a month, said: ‘I didn’t really want it but they said I could cover the payments.



‘Because of the pressure of paying back these charges, Wayne losing his job and having a baby, I ran up a bill of £500 which I’ve just managed to clear.’



The couple said they have visited the bank nearly every week to try to find a solution but had been unable to resolve the problem.



Mr Green said: ‘It’s a ridiculous situation. We are paying back the money, and I took in £150 and £200 when I’d been paid, but every couple of months they would charge us again.



‘It just spiralled from there. We don’t understand why they keep charging us. We went in and spoke to people but they didn’t seem to know either.’



Miss Hannibal added: ‘Every time I go into the bank I’m normally in there about three hours. I talk through the situation with people but at the end of the day they cannot do anything to help. They don’t seem willing to help me.’

Charges: Lloyds TSB charged the family more than £1,000 in penalties after they went overdrawn by just 8p (file picture)

Before Mr Green lost his job, the couple said they came within about £30 of clearing their overdraft but were again hit with another overdraft payment which plunged them deeper into the red. Mr Green said: ‘It seemed like they realised we were close to paying up and so they decided to make us pay more.’

Miss Hannibal said she had written to the bank to complain. She added: ‘It should be against the law to charge such high charges. I’ve had to pay more than £1,000 for an 8p overdraft, it’s ridiculous.’

Lloyds TSB replied by letter that an investigation by the Office of Fair Trading had led to a hearing about charges at the Supreme Court in November 2009. It said: ‘We consider our unarranged overdraft fees to be fair and don’t believe there is any basis on which they could be successfully challenged.

‘As a result we won’t be upholding your complaint or be providing a refund of these fees.’



But a spokesman for the bank said: ‘We are sorry for the distress that this has caused and we are working with Miss Hannibal to resolve this.



'We always work closely with any customer who is facing financial difficulty. We have been in close contact with Miss Hannibal to help her manage her finances, including waiving a number of fees.



'Where additional charges have accrued on the account it has been as a result of continued use of the unplanned overdraft facility. We are making contact with Miss Hannibal again to discuss her situation, what steps can be taken to resolve it and how we can work together.’



