Not upheld: poor handling of direct debit indemnity guarantee claim; inadequate customer service and communication complaint against Barclays Bank UK PLC

Decision detail

Summary

Miss B complained that Barclays handled her direct debit indemnity guarantee claim unfairly after she discovered she had been paying for someone else's electricity for over six years due to incorrectly wired meters. While Barclays quickly refunded payments to one energy company, it requested additional information for claims relating to two other energy companies, which Miss B found frustrating. Following FOS involvement, Barclays refunded all disputed payments (approximately £4,000) and offered £350 compensation. The ombudsman upheld that Barclays caused unnecessary distress through poor communication and failure to explain its additional checks, but found the £350 compensation was fair and reasonable for these service failures.

The Ombudsman's reasoning

The ombudsman found that while Barclays was entitled to conduct additional checks for older or larger claims under the direct debit indemnity scheme, it failed to clearly explain why these checks were necessary or manage Miss B's expectations appropriately. The case was complicated by the fact that the issue was fundamentally a billing error rather than a direct debit error, and the agents struggled to find appropriate reason codes. However, the ombudsman concluded that Barclays' failure to provide clear communication and better customer service caused unnecessary distress and inconvenience, but the £350 compensation offered was proportionate to this failure.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website