Upheld: Account closure without notice complaint against Lloyds Bank PLC

Decision detail

Summary

Mr C complained that Lloyds closed his savings account without proper notice and delayed returning his funds of over £5,700. The closure notice was sent on 24 October 2024 but did not arrive at his address in Croatia. Lloyds sent a cheque which could not be cashed abroad, and when Mr C requested an international transfer, Lloyds failed to clearly communicate that certified identification was required, causing further delays. The ombudsman upheld the complaint in part, finding Lloyds not liable for the non-arrival of the closure letter due to postal service issues, but liable for communication failures regarding identification requirements and processing delays. Lloyds was ordered to pay 8% interest on the account balance from 15 May to 25 June 2025 and £200 compensation for distress and inconvenience.

The Ombudsman's reasoning

Lloyds fulfilled their obligation to send a notice to close letter; the non-arrival was due to postal service issues beyond their control and they cannot be held liable for this. However, Lloyds made a clear error by not informing Mr C on 5 February 2025 that certified identification would be required for international transfer, and they delayed processing once documents were received on 15 May 2025. The account closure process itself was fair and followed proper procedures. Compensation is warranted for the communication failures and processing delays, but not for consequences arising from postal service failures.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website