Not upheld: account handling error and unarranged overdraft charges complaint against Clydesdale Bank Plc trading as Virgin Money

Decision detail

Summary

Mr S complained that Clydesdale Bank Plc trading as Virgin Money unfairly handled his account closure, resulting in an unarranged overdraft. When Mr S withdrew funds during the account closure process, Virgin Money miscalculated the account balance, leading to overdraft charges and debt collection action. Virgin Money acknowledged the error and removed adverse credit file entries within three days. The ombudsman found that while service failings occurred, Virgin Money's remedial actions—including removal of adverse markers and allowing Mr S to retain the miscalculated funds—were fair and proportionate, and declined to uphold the complaint or award additional compensation.

The Ombudsman's reasoning

The ombudsman acknowledged Virgin Money's service failings but considered that the firm's remedial actions—removing adverse credit markers and allowing Mr S to retain the benefit of the miscalculated funds (£168.74 withdrawn twice)—were fair and proportionate. The ombudsman noted that compensation awards aim to recognise impact on consumers where shortcomings exist, not to be punitive, and that Virgin Money's swift response within three days of complaint was appropriate.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website