Established in 1992
Discover Secrets to eliminate anxiety and distress from UK Business Bank debt claim
Recently received a business banking personal guarantee debt claim as an ex company director or partner?
Do you want to defend bank's legal claim on Director's personal guarantee?
Directors UK Bank Personal Guarantee Debt Claim Demands and the IBAS Christmas Warning Post
Christmas 2019 is fast approaching and Banks will use their normal 'holiday' strategy on legal claims.
- That means they will be already preparing their Christmas legal claims.
- Many are prepared deliberately to drop through your letterbox just before 'close of business' on Christmas Eve.
- Getting 'advice' for a Director's Personal Guarantee Debt Claim around Christmas and New Year is extremely difficult.
- Banks know that - whilst they have easy access to solicitors at all times their customers will not.
- Between Christmas Eve 2019 and 2nd or 3rd January 2020 is a normal holiday period for most in the UK.
- Therefore, good strategy (although extremely unfair) for banks to issue a claim ready for 'service' on Christmas Eve.
- The 'service' on you will be deliberately timed for maximum effect for the bank's benefit.
- The legal clock starts ticking once a claim is 'served' which puts the customer under extreme 'time' pressure.
Losing 10 days in the Christmas - New Year period doesn't help those with legal claims obtain help.
- Banks know that customers will be forced to react - which means many customers will also attempt a DIY response.
- Banks love DIY responses, as they know they will normally lead to the bank obtaining an 'easy judgement'.
- The customer just doesn't react at all and judgement is obtained by the bank by default.
- DIY responses miss possible defences which are effective legal arguments to avoid 'strike out'.
- We would suggest that anyone with a bank claim 'lurking' against them - obtains help.
- Do not get 'rushed' into answering a bank's legal claim without any help at Christmas.
Drop IBAS an email and we will explain what can be done.
IBAS website was launched in 1998 to help UK businesses with banking disputes.
(see BBC Testimonial for IBAS in 1999) at: Your Money Not a moving account - BBC 22/07/99
IBAS has featured on BBC TV, BBC TV News, ITV, Meridian and Sky News and contributed to many editorials and articles including those for the Sunday Times, Times, Daily Mail, Daily Express, Telegraph and Daily Mirror.
The Bank’s Final letter for your business banking dispute complaint & business complaints to the Financial Ombudsman Service (FOS)
It is a fact that all banks spend considerable time and effort 'drafting' their Final response letter to the customer on complaints because they know that their Final Response letter is designed to persuade the Financial Ombudsman Service (FOS) to their position. By that time the bank’s customer services/complaints department will have already extracted all your information from you for their benefit by questioning you and then they will have dismissed your complaint/s.
Bank Final response letters are drafted and written by legally trained bank staff who are communicating with the FOS daily and are therefore completely aware of FOS decision making.
The Financial Ombudsman Service staff are aware that bank Final response letters are prepared by legally trained bank staff and the bank’s Final response letter will influence the FOS ‘investigator’.
Bank customers may believe their business banking dispute complaint/s will get a fair hearing by the FOS and from reading the FOS website may also be misled into believing that it is ‘easy’ to make a business banking complaint through the FOS.
However, banks possess very distinct advantages, which include legal knowledge, long experience of ‘complaint casework’ and know what is effective (for the bank). Banks also know how the FOS 'thinks' as they communicate regularly with the FOS by telephone.
The Financial Ombudsman Service do not calculate bank accounts to provide an independent calculation where they are required. The Financial Ombudsman Service will rely on bank methodology and bank calculations when dealing with a business banking account dispute.
The bank's Final letter allows you 6 months to make a complaint to the FOS.
see very poor 2019 - Trust Pilot Reviews for Financial Ombudsman Service
What will the Independent Banking Advisory Service (IBAS) provide you for your business banking dispute complaint which the Financial Ombudsman Service (FOS) will not?
IBAS will carry out fully independent investigations of business bank accounts based on the customers complaint and will provide fully independent calculations with a report which can then be relied upon to evidence incorrect charging, bank errors and overcharging.
Historical banking account errors/bank charging mistakes and bank overcharging claims evidenced by IBAS account investigations and calculations enable effective business banking account complaint progression. IBAS has been calculating business bank account and overcharging complaints since the mid 1990's
IBAS account investigations enhance the customer's complaint with substance to evidence bank charging errors to the customers advantage.
IBAS will investigate business banking disputes which IBAS 'take on' and progress for the customer.
IBAS reports can then be relied upon for any business banking dispute which IBAS has accepted.
IBAS investigate Director’s Bank Personal Guarantee dispute complaints and assess all other security documents held by the bank for lending purposes to establish the facts and historical positions. Specific advice on business banking account/s disputes and further actions required are provided by IBAS once our investigations conclude.
Information from those we have assisted since 1992 show that other ‘advisors’, solicitors & also the FOS carried out very limited or basic ‘checks’ on business banking complaints. Basic ‘checks’ cannot identify customer defences, allow debt reduction or eliminate a debt being claimed.
It’s clear that ‘other advisors’ provide advice and ‘outcomes’ without necessary facts. That disadvantages or destroys the customer’s ‘case’. IBAS has a long established standard practice for investigating bank customer’s business banking account disputes in depth – other ‘advisors’ do not do so.
It is unfortunate that despite the extremely damaging TV and newspaper media coverage against all banks over the last 10 years, that many very experienced business people still mistakenly believe, that if their company fails their bank will properly examine their business banking complaints and provide ‘fair’ treatment.
Ideally, in a fair world that might happen - but this is not a fair world and Bank debt recovery units appear to be completely autonomous of their bank, whilst also operating conveniently outside FCA regulation. Recent news on RBS/NatWest/GRG merely reinforces what IBAS already knew - that banks use and have used very unfair devious and dishonest bullying tactics for many years to achieve debt repayment on business bank debt claims, some of which have proved to be incorrect or engineered, whilst the FCA appear powerless or worse protective of the banks.
The worry of receiving a demand from a bank for payment of a business banking debt claim or a director's personal guarantee liability claim is considerable. Your personal anxiety will immediately impact on your family. Your distress may also blind you to any logical action. That may also cause even further distress later. I know that is true. My family experienced such anxiety when there was nobody like IBAS to help us - that’s why IBAS exists now.
The list of ‘what ifs’ (i.e. what if they may make me bankrupt? - what if I lose the home?) loom large and can completely shatter your thinking and cause many sleepless nights,cause arguments and fraught family conversations, whilst your brain struggles to evaluate how best you can deal with the business banking debt claim. Your anxiety will be greater if your home is already pledged to the bank or you have signed a Personal guarantee on which the bank can rely.
Business banking customer’s use of telephones as a quick and easy option when faced with such anxiety makes them extremely vulnerable and can then lead them into a very dangerous and targeted banking ‘trap’.
The bank’s know they can ‘tweak’ their demand letters to appear sympathetic. Those letters are intended to ‘encourage’ the customer to telephone the bank quickly. The banks first aim is to get the customer on the telephone and those letters are deliberately ‘baited’ with words to appeal to your instincts to act quickly this is a deliberate and underhand psychological bank ‘trick’ to allow the debt recovery officers to 'use' or manipulate the customer's telephone call into 'playing on' the customer's fear and to get ‘into’ the customer’s head and ‘push’ the fear ‘buttons’ to also ‘goad‘ and ‘bully’ the customer to provide answers which the bank wants.
Bank Debt Recovery Strategy provides bank debt recovery officers with very good legal training and very organised telephone scripts to be used when the customer rings them. The bank telephone scripts are designed to target, frighten and intimidate and also ‘pin down’ the customer into making a proposal to pay which will be recorded.
The bank telephone ‘scripts’ are intended to ‘flush out’ your possible defences or complaints at an early stage - so the bank can destroy them quickly. Debt Recovery officers are trained to divert the conversation where they want it to go as they act only for the bank. They are not there to advise you!
Once they have you on the phone any trick is possible to get what they want from you. Many customers exit such calls feeling shellshocked and ‘bullied’ and only then do they realize these people are not like any other bank department they have ever dealt with before and that there was no real intention to help them.
Once the bank has all they need in information from the customer, recorded it all and has also removed the customer's defences to the bank’s claim - the bank will then be even more ‘motivated’ into taking your assets to get paid - which may then also include the customer’s home. Then, the bank will be working to the banks timescale - not yours.
Therefore, if you want to best protect your family, telephoning the bank is an exceptionally bad idea which may be catastrophic and with no benefits for you - because the bank will target your assets at a very much quicker pace than you might want.
See: What you should not do if you receive a bank demand for payment on a personal guarantee
We have found that customers who thought the bank might be fair with them only find out they were wrong after they have totally compromised their position - then it’s too late - as they are financially crippled, victims to the banks relentless asset stripping.
Maybe you’re fooled by the bank’s letter, into thinking the easy way is to fill in the bank’s form and offer £10 a month? or tell them you have nothing to make a proposal to them? Or perhaps a complaint to the FOS may assist you?
Then also see: 2019 - Trust Pilot Reviews for Financial Ombudsman Service
The danger then, is that not being able to pay a demand is not a defence and unfortunately, a great many people do not understand just how much information is easily available to banks about you and your finances. Banks have a very reliable network to search for your financial information and your asset position once they have ‘issued’ you with a demand. The Demand on you is a legal requirement and a necessity which then allows the bank to search for your assets and collect all such information about you - on which the bank will then rely.
The bank will also have quite detailed bank notes taken from what you have told them during your various conversations - all important financial information which concerns both you and your family will have been recorded. Just think about what you have told the bank in what you thought were ‘off the cuff’ and personal ‘chats’ - you may be surprised by the notes that have been recorded by them.
When IBAS has been tasked with assisting solicitors in claims involving business banking debts and personal guarantees we have been allowed access to bank internal files as part of the ‘discovery process’. The ‘internal notes’ recorded many very small details on the customer and their family including assets and property and possible inheritance claims. All of value to the bank in seeking payment for a debt claim.
The other alarming factor was how resentful and derogatory bank employees were to the customer in those notes. What we saw was a distinct ‘them and us situation’ where the customer was viewed as just another ‘punter’ and their property just ‘up for grabs’ - as and when required. If the customer knew or saw such notes they would be a great deal more careful in sharing any financial information with their bank.
Of course, once the bank’s demand is issued the bank will be actively ‘searching’ all their sources of information (including their internal bank notes) for how best to obtain payment from you. Initial information will be obtained on your existing mortgage, charges, how much is outstanding, what the property is worth - that’s before you complete your personal financial statement. Therefore the bank will be aware very quickly whether you have resources which can pay them.
Your completed financial statement then allows the bank to double check your full financial position to see if anything else you have provided ‘leads’ them to further property/assets of which they were not previously aware.
The bank’s existing knowledge of you will already be very good and your completed personal financial statement will provide the bank with an exceptional opportunity to pinpoint exactly where to concentrate to take assets (or charge against) later to obtain full payment. (i.e. if you offer £10 a month but the bank knows you have available assets with which the bank could be paid quickly).
IBAS experiences of case work over many years evidence that your remaining together intact as a family and your survival from a business banking debt ‘claim’, depends largely on whether you can channel your immediate anxiety from the bank’s demand letter into a much more positive thought process and not make the mistake of believing the bank will treat you fairly once they have issued you with a demand for payment.
Of course, you can struggle along uncertain of what you can do without any real plan and the bank will inevitably ‘take control’. Or, you can allow IBAS to look at your position first and then guide you - so that your case can be properly assessed and then provide you with an action plan based on all the facts - that is the real value of IBAS.
It might help, if I also explain what the bank’s ‘thinking’ is when they make their demand on you. A bank’s Demand is issued only when the company/business/partnership/sole trader cannot or has not paid what the bank requested or when the bank decides they do not want your accounts anymore. What is clear is that the bank’s Demand ends any business - customer ‘relationship’ and if the demand is not paid in full within 14 days the bank branch dialogue also ends.
Then there is no ‘business banking relationship’ at all. The bank will consider you are no longer a customer and that the bank no longer owe you any duty.
There is normally a period of inaction, whilst the file (which you may think is in dispute because of your complaint/s) is transferred to the bank’s debt recovery unit. If you contact the branch during this time they will ignore your call as your file is between branch and Debt Recovery Unit awaiting a debt recovery case officer to be allocated to it.
It is a serious mistake for the customer to not use the bank’s ‘inactive’ period for their benefit. The danger in not using that period is that those business banking customers with legitimate concerns or disputes may then lose important information. Such information could be used by IBAS later to verify information which may protect you and also yourr family. Your positive ‘activity’ at this time will eliminate a good deal of the immediate anxiety for you and your family but may also provide important information which otherwise may be lost. IBAS will then be able to focus attention on what is required to best help you.
Immediately, a bank debt recovery officer is allocated to your file your position is under increased threat - this is the most dangerous time for the business bank customer facing the bank’s debt recovery strategy. From now onwards the bank will seek to ‘control the claim’ for their benefit. The debt recovery officer will issue a further demand on you to pay up or provide proposals within 14 days. They may also phone you to attempt to gain/obtain your ‘proposals’ to pay whilst the letter is on it’s way to you. At the same time The Debt Recovery Unit will also send out a Personal Financial Disclosure form for you to complete and they will request completion and return within 14 days.
However, completing that form and making proposals will end any dispute you may have and allow the bank to continue to legals without delay - as that form signed and delivered to the bank is your confirmation that you accept the debt/s being claimed - otherwise why would you complete it?
You may ask why the bank requires so much information (which varies between 8 - 16 pages of financial questions) and you may also query what does the bank really want?
It is important to know why the bank asks questions and request you complete a personal financial statement and sign it. All items on the form will be assessed individually by the bank as to what is in their opinion a) a necessity and b) what is frivolous or c) extravagant.
Your household expenses will be evaluated individually against the Standard Financial Statement ‘trigger figures’ on expenditure guidelines which are also accepted by the courts.
The ‘trigger figures’ are not supposed to be generally available and the Money Advice Trust only wants CFS licence holders to know or use them. The ‘trigger figures’ are also apparently exempt from Freedom of Information requests.
Therefore, unless you use an advice agency competing your form personally may lead to the bank ‘finding’ large amounts of ‘expenditure’ which they can then claim is unnecessary and that all such amounts should be used to pay them.
Also, your making a proposal on that form does not mean that the bank will accept what you have proposed. But, making even a small proposal will bind you to the debt claim and 'open up' the financial information you have then provided for very close examination by the bank’s debt recovery team.
The bank will be seeking the quickest form of payment and at this stage (they will be thinking weeks and months - not years) Whilst the bank’s letters are intended to show compassion (so that you make an offer to pay) once they have your proposal it is a case of not whether you pay - but how much and how quickly. It is often the speed of the bank’s actions at this time and also their deviousness which most shock customers.
Unfortunately, as the bank’s strategy is to eliminate any defence to the bank’s claim as soon as possible, it is not unusual for a customer to make a proposal for a small sum and then within a week find they are then ‘served’ with the bank’s debt claim through the courts with additional costs. Losing your defences also means losing any possible negotiation which then places you and your family completely at the bank’s ‘mercy’.
If you have a home and mortgage those and any other assets you have ‘shown’ will now be investigated and assessed by the bank’s Debt Recovery Unit for ‘available’ equity and the property where you reside will be examined more closely to establish how best to ‘release’ any equity quickly.
If you claim you are renting your property, the bank will seek a rental agreement and will closely examine any connections with your family to that property or indeed that 'agreement'..
If you have an unanswered business banking dispute it will not change the bank’s strategy once Demand has been issued and Debt Recovery is engaged in collecting the debt claim - they then consider you are no longer a customer and they want their money back ASAP and are then in the ‘mode’ to collect that debt any way they can.
Those who have been referred to IBAS by friends or colleagues (who have already experienced how IBAS operates) consider they are the ‘lucky ones’ and their relief on having IBAS ‘take on’ their case is obvious. They know that IBAS will fully investigate and ‘interrogate’ the case information and all it’s details and will then provide them with well thought out business choices.
As you will see from IBAS Testimonials in some cases a total bank debt claim has been eliminated. In other cases they were vastly reduced.
But, the majority of IBAS members come to IBAS with concerns about the way their business was poorly treated (or cheated) by the bank and most are seeking a fair resolution or often just time to pay an amount which they consider is a ‘qualified amount’ or a negotiated figure based on what has occurred or gone wrong in the banking relationship. Few are seeking to evade the debt itself.
However, whilst the bank’s letters appear to ‘offer’ bank customers sympathetic treatment, that is not what they will receive after Demand - the banks treat all who enter into Debt Recovery as being debtors who need to be taught a lesson. Even those with terminal illness find the bank’s debt recovery experience debilitating and in some instances very personally intimidating or plain ‘nasty’.
IBAS testimonials evidence how many of our members have followed IBAS guidance to a successful conclusion. Many more have gained a very successful conclusion and we have not heard from them since their case conclusion.
We accept that some members are just glad to get rid of their problem and providing IBAS with a testimonial even after an exceptional or very good result can be forgotten as IBAS has by then done it’s job!
We are always grateful when an ex member provides IBAS contact details to someone else they know - that is a good Testimonial for IBAS.
I hope this ‘expose’ helps those now seeking help and assistance with a business banking debt claim or dispute to properly understand what it is they face if they attempt to communicate with their bank after demand. I also hope this will galvanize them into positive action. Our work since 1992 has shown just how devious bank debt recovery teams are especially when they have customers on the telephone.
However, this ‘expose’ does not reveal all the bank’s debt recovery ‘tricks’ or their rather devious ‘legal shenanigans’ which are used to ‘take’ customer’s assets and property, following a bank’s demand for payment. We would need to write a book to cover those.
But, IBAS knowledge of what banks can do and what they have done in Debt Recovery ‘mode’ has been instrumental in our guiding and helping many of our members to survive some rather vicious and malicious bank recovery tactics.
If more business bank customers with a bank debt demand avoided the bank telephone ‘trap’ and emailed IBAS instead - there might be more families making more positive decisions to strengthen their own position - rather than weaken it.
Please feel free to pass this information on to anyone you know who is now facing a business banking dispute in the UK or is having difficulties with their business bank accounts or worried by bank bullying - because IBAS is still the best kept secret for the best investigation and resolutions of UK Business Banking Debt Disputes and for investigating and negotiating Director's Personal Guarantee debt claims and Business Banking issues.
If you use this information in any way - please attribute it to IBAS.
Eddy Weatherill - IBAS ceo at 23rd January 2019
Last modified:16th November 2019