Not upheld: Account closure without notice complaint against Bank of Scotland plc

Decision detail

Summary

Mr M complained about BOS closing his credit card and recording a default on his credit file after experiencing financial difficulties related to a legal dispute. BOS had agreed multiple forbearance plans between February and December 2025 that froze interest and charges, though contractual payments remained due and arrears would be reported. After no payments since January 2025 and no contact following the final plan's end in December 2025, BOS closed the account on 17 January 2026 and recorded a default, later amending the default date to 28 April 2025 as a gesture of goodwill. The ombudsman found BOS had provided reasonable forbearance and that the account closure and default recording were fair and proportionate, not upholding Mr M's complaint.

The Ombudsman's reasoning

The ombudsman found that BOS provided a good level of support and forbearance by agreeing multiple plans, freezing interest and charges, and not applying collections pressure during plan periods. Although the plans required Mr M to make contact before they ended, BOS took his circumstances seriously. After no payments for a year and no contact following the final plan's end in December 2025, despite further letters and text messages requesting contact, the ombudsman considered it reasonable for BOS to close the account and record a default. The amendment of the default date to 28 April 2025 (when the account was three months in arrears, in line with industry guidance) was fair as it would allow the default to drop off Mr M's credit file approximately nine months earlier.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website