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Don't Bank On It

I have sold my house and I am therefore temporarily rich. One of the big advantages of not owning a house is that you do not have to pay rates on it. Up to now, I’ve been paying the rates by direct debit – it seemed the easiest thing to do. Auckland City Council simply took whatever they needed, whenever they needed it without bothering me, and everyone was happy. However since I am of a suspicious nature, I decided to cancel Auckland City Council’s direct debit authority once the house was sold, so that even if they wanted to, they would no longer be able to collect money from me. I preferred to do it that way – I didn’t fancy having them take money they were not entitled to (by mistake of course) because then I’d have to spend ages arguing with them about getting it back. Given how slowly the wheels of bureaucracy grind, that could take forever and would probably require an infinite number of forms to be filled in. So I decided that I would simply not allow transactions like this to happen in the first place.

Making that decision was my first mistake.

I wrote a letter to the Bank of New Zealand. That was my second mistake.

"Please cancel the direct debit authority for Auckland City Council," said the letter.

I received no acknowledgement (nobody ever replies to letters), so I sent them a secure email via their internet banking site. This time I got a reply confirming that the authority had been cancelled.

And so it was done.

About ten days later I received an irate letter from Sky Television. They had gone to my bank to collect their payment, as they have been doing every month for a decade or so, only to be told that their charges were refused. The bank could not pay them.

Well these things happen. There are always hiccups. I wrote a cheque for the outstanding amount and thought no more about it.

Two weeks after that my payment to my ISP was refused, closely followed by payments to my insurance company and the power company. I began to panic – what was going on? I contacted the Bank of New Zealand again.

Ring, ring. Ring, ring.

"Hello. I am a robot telephone answering machine, specially designed by the Bank of New Zealand to frustrate you. Please select a random number from the following list of extraordinarily vague choices…"

After choosing the appropriate options from the voice mail messages (and a few inappropriate ones as well), I was placed on hold and remarkably unsoothing muzak was played into my earhole. Every so often the robot came back on the line and informed me how important my call was. As a result of all this, by the time a human being arrived on the scene my already seething temper had become positively volcanic.

"Several direct debit payments have been refused recently. Can you please check up on this and tell me why?"

"Of course sir – just a moment."

Clatter, clatter, clatter, click, click as keyboards were keyed and mice were moused.

"You haven’t got any direct debit authorities sir."

"What! That’s ridiculous. What about all these companies that are trying to get their money through direct debits? What’s happened to them all?"

"There are no direct debit authorities on your accounts sir. Probably the application forms haven’t been processed yet. You do realise that you often have to wait a few days before the direct debits are activated after the forms have been filled in?"

"No – these aren’t new ones," I explained. "They’ve been in place for quite some time."

"No, that’s not right," said the Bank of New Zealand person. "There aren’t any direct debit authorities on your account, so they must still be working their way through the system."

"Don’t be silly," I said. "I’ve been paying my insurance premiums by direct debit for twenty years. Look at my transactions for the last couple of months – you’ll see heaps of direct debits."

Clatter, clatter, clatter, click, click.

"Oh yes, there they are. Obviously you must have cancelled them."

Light began to dawn.

"No," I said. "I issued instructions for one direct debit authority to be cancelled. I think you must have cancelled all of them by mistake."

"Oh no sir, that can’t possibly happen. You must have asked us to cancel them. There are no direct debit authorities on your account so you must have cancelled them all."

"Don’t be ridiculous," I said. "I’ve got the letter here." I read it to him.

"I’ll look into it sir, and ring you back."

Click. Huuummm.

I hung up the phone and waited.

Much to my surprise, the Bank of New Zealand person did eventually ring back. I was impressed; this is rare in my experience.

"The direct debits were all cancelled on the 17th," he said, "which was the day after the date on your letter. So it does look as though something has gone wrong with the system and they accidentally cancelled all of them instead of just the one you requested."

"Can you reinstate them, please?"

"No, the banking rules won’t let me do that. You have to go back to all the organisations that need a direct debit authority. You ask them for a direct debit form and when you get it you fill it in and send it back to them so that they can lodge it with us."

"So you stuffed up, but I have to do all the work to fix your mistakes?"

"Well," he said, sounding a little embarrassed, "yes – if you put it like that."

"Names," I said grimly. "Give me names and phone numbers and email addresses for the people involved in all this. Give me the names of their managers and the names of their managers."

He was reluctant – but I got my list. I was given the name and email address of my personal banker and the name and email address of the Area Customer Services Manager. Up to that point, I hadn’t known that I had a personal banker – it had never occurred to the Bank of New Zealand that I might find this information interesting and useful, so they had never got round to telling me about it.

I sent details of my case to the Area Customer Services Manager. The email practically melted the screen as I read it back. I felt it was satisfactory and I pressed the Send button.

Over the course of the next few days I received grovelling telephone calls and emails apologising for the error, but no practical help at all. I still had to do the rounds of the people I owed money to and try to sort out the mess myself. Also the chickens were coming home to roost now, and I was being charged late payment fees – so I was doubly out of pocket through no fault of my own. Grimly I reported this to the Area Customer Services Manager of the Bank of New Zealand and demanded action.

I received a letter from the Area Customer Services Manager. It apologised profusely for the financial embarrassment I was going through. All procedures had been tightened to ensure that this kind of thing could never happen again. All the staff involved were being given counselling (counselling!! Dear God, what is the world coming to?). I didn’t believe a word of it – I’m sure that they did absolutely nothing; they just said they’d done it in order to make me feel good.

The letter went on to say that in view of the fact that the error was clearly the bank’s, they had decided to waive my bank fees for the month and to pay me 50% of the value of the cancelled direct debit payments as compensation for their blunder. Also included with the letter were letters to all the companies involved explaining that the error had been made by the bank and asking that any late payment fees be billed to the bank rather than to me. I was requested to forward these letters to the relevant companies should it prove necessary. There were no stamps included with the letters. Postage charges were obviously my responsibility.

It is now just over a month since the direct debit fiasco happened and I think I’ve finally got all the authorities reinstated (these things take a frustratingly long time). Needless to say, the new authorities are not with the Bank of New Zealand. I don’t trust the Bank of New Zealand to get anything right and I am now in the process of transferring my financial affairs to a different bank, one that will hopefully prove to be a little more trustworthy.

I no longer find it surprising that the Bank of New Zealand teetered on the verge of bankruptcy a few years ago. I always wondered how a bank managed to lose money. Now I know. They only employ incompetents.

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