Upheld: unauthorized account closure and breach of account terms complaint against Nationwide Building Society

Decision detail

Summary

Mr L and Mrs S held a joint savings account requiring both parties to sign for transactions and closure. After Mrs S died in December 2024, Mr L discovered in May 2025 that the account had been closed and emptied in April 2024 without his knowledge or authorization. Nationwide's branch staff allowed Mrs S to transfer the funds and close the account in breach of the 'both to sign' requirement, and Mr L was not notified. Nationwide could not locate documentation of the transaction and provided Mr L with contradictory information about whether the signature requirement had changed. The ombudsman upheld the complaint, finding Nationwide breached the account terms and provided poor service, but declined to order refund of the account balance as it now forms part of Mrs S's estate. Nationwide was ordered to pay £500 compensation and provide a formal apology and explanation.

The Ombudsman's reasoning

The ombudsman found that Nationwide's branch staff breached the account terms by allowing Mrs S to transfer funds and close the account without Mr L's authorization or knowledge. The 'both to sign' requirement was clearly in place and should have been enforced. Nationwide's failure to retain transaction documentation prevented a full explanation of events. While the funds are now part of Mrs S's estate (of which Mr L is a beneficiary), Nationwide's poor service, misleading information, and breach of account terms caused significant distress to Mr L. The ombudsman rejected refunding the account balance as it has already benefited Mrs S's estate, but upheld the complaint regarding the procedural breach and poor service.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website