Upheld: Account administration errors complaint against HSBC Bank Plc
Financial Ombudsman decision DRN-6469012 of 2026-07-03T00:00:00+00:00. Account administration errors complaint against HSBC Bank Plc. Outcome: Upheld.
Decision detail
| Reference | DRN-6469012 |
|---|---|
| Decision date | 2026-07-03T00:00:00+00:00 |
| Firm | HSBC Bank Plc |
| Product | Mortgage |
| Claim type | Account administration errors |
| Outcome | Upheld |
| Remedy | HSBC must: (A) Calculate interest paid on mortgage from June 2018 to April 2019 with no repayments; (B) Calculate interest that would have been paid if all direct debit repayments had been made during that period; (C) Pay Mr B the difference between A and B; (D) Pay 8% simple annual interest on C from date of redemption payment until settlement; (E) Pay £500 for distress and inconvenience. |
Summary
Mr B complained that HSBC sent mortgage correspondence to the wrong address since 2018, leaving him unaware of arrears and final demands. In January 2018, HSBC informed Mr B that all his accounts would transfer to Bank A on 1 July 2018, but the mortgage was missed in this migration and remained with HSBC. When Mr B updated his address with Bank A and enquired about his mortgage, he was told he did not hold one with them. Following closure of his current account in June 2018, no further mortgage payments were made, and HSBC sent reminders and final demands to an incorrect address in Country E. Mr B only discovered the outstanding £13,000 balance in April 2025 when selling his property. The ombudsman upheld the complaint, finding it reasonable for Mr B to believe the mortgage had transferred and that HSBC should have communicated the non-transfer. HSBC was ordered to refund excess interest accrued during the missed payment period and pay £500 compensation.
The Ombudsman's reasoning
The ombudsman found it reasonable for Mr B to believe his mortgage had transferred to Bank A given the January 2018 communication stating all accounts, products and services would transfer. HSBC failed to inform Mr B that the mortgage was not transferred and that he needed to update his details separately. When Mr B updated his address with Bank A and was told he had no mortgage with them, this was technically correct but caused reasonable confusion given the lack of communication from HSBC about the non-transfer. The ombudsman found it reasonable that Mr B would have resumed mortgage payments had he been aware of the situation and received the correspondence at the correct address. Therefore, HSBC should refund the excess interest accrued during the period of missed payments, plus compensation for distress and inconvenience.
How this compares
| Group | Decisions | Uphold rate |
|---|---|---|
| HSBC Bank Plc, all decisions | 10,099 | 37% |
| Account administration errors, all decisions | 26,574 | 25% |
| Mortgage, all decisions | 24,714 | 22% |
Source
Read the original decision on the Financial Ombudsman Service website