Bank fraud and three.ie

Neeve1234

Hi All

I moved to US in 2008. I still maintain a bank account in Ireland as I have a mortgage and associated life insurance to pay out monthly. As I never use the account for anything else and do not use the ATM card I rarely check the account. Yesterday I discovered a monthly reoccurring charge had increased. I thought this was my life assurance so called my bank querying. It turns out it is payment to a bill for Three.ie. The DD was set up in Feb 2011. I do not have an irish phone and I wasn't even in the country at the time. I cancelled the DD. Contacted three through here as they have no phone number for me to call ( their customer service contact info on web is terrible) . Sheena responded promptly . I provided her the originator number provided by bank and she told me they investigated and I needed to file an indemnity claim with bank.I called AIB who said they can only reverse last 2 months payments and that I need to address refund for remainder with three.
So I asked three for a copy of the signature they have on file for this and how a DD was set up in my account without my authorization. They can only tell me that its not in my name and as such cannot give me any information! Apparently I am a third party although I am paying for it. This is ridiculous.
I have asked Three for their policy on setting up a direct debit and getting proof of identity to do so. As its the weekend I dont expect a response til next week

I am calling the guards to file a theft report and hopefully they can get the info from Three. Three wont give me my money back and I can only get AIB to refund last 2 months. I am filing a report with them also. I have to say AIB have been more than helpful.

I will be filling a complaint with COMREG once I have official complaint number from three.

Has anyone had similar issues and can anyone advise if there is something else I need to do

Thanks in advance

niceoneted

No advice to give as I think you have all the bases covered. But this is shocking. Then again I recently changed SIM cards to a new phone I had bought myself and was not asked for any identification whatsoever.

MarkR

Is your bank account a joint account? Anyone else have the authority to set up a direct debit for the account? There's a "Talk To Three" section on boards that can (on occasion) be helpful.

http://www.boards.ie/ttforum/1367

It sounds like a direct debit was set up for someone with your details (accidentally I presume). It would make you wonder about the person who was getting free calls from three!

Mat the trasher

Should AIB not have received a copy of authorisation form from Three to set up the DD for their own records?

Fred Swanson

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Marcusm

Get Three to confirm to you that you are not the account holder. THis will make it easier to establish that you have not authorised the DD. It may not even be a case of fraud but a transpositional error.

Teagwee

This amazes me. I thought that a direct debit from someone's account had to, at the very least, be in that person's own name. So, for three years, some random person has been allowed to raid the OP's bank account openly to pay for their telephone bill, courtesy of 3? And even though the OP is paying the bill, they can't have access to any information about this person or how they managed to achieve this?

Do the new SEPA guidelines prevent this from happening from now on, or are we all still at risk of this?

3 clearly know who this person is and will have to suspend the fraudulent account now that the DD is cancelled. Undoubtedly, they will need to pursue them for ongoing payments and will be obliged (at some point) to recoup all the money due to them on that account after they pay the OP back for three years of their own money.

Marcusm

Teagwee wrote: »

This amazes me. I thought that a direct debit from someone's account had to, at the very least, be in that person's own name. So, for three years, some random person has been allowed to raid the OP's bank account openly to pay for their telephone bill, courtesy of 3? And even though the OP is paying the bill, they can't have access to any information about this person or how they managed to achieve this?

Do the new SEPA guidelines prevent this from happening from now on, or are we all still at risk of this?

3 clearly know who this person is and will have to suspend the fraudulent account now that the DD is cancelled. Undoubtedly, they will need to pursue them for ongoing payments and will be obliged (at some point) to recoup all the money due to them on that account after they pay the OP back for three years of their own money.

There's an awful lot of misconceptions regarding DDs; there is little sharing of information and the system is based on the bank extending trust to the merchant while assuming that the customer will review their accounts on a reasonably timely basis. In the world of internet banking, this should work well in more than 99% of situations (I suspect that the issue is with much less than 1% of DDs) as the customer would be able to spot a rogue DD quite quickly especially in circumstances such as this where there are likely to be few transactions on the account.

That being said, I would not blame the OP for not realising earlier and I would hope that their bank can assist in recovering the funds. Organising DDs in a manner such as this is to reduce transaction costs and, hopefully, error rates. If all DDs had to be organised by written mandate which was signed by a customer and verified by a human at the bank there would be a lot more cost and a lot more employment in the financial sector!

People need to realise that granting DD mandates allows merchants to fish into their accounts at will - generally via electronic instructions to the bank from the merchant. The counter security is the DD guarantee which SHOULD mean that disputed DDs get reversed immediately although they have been known to take a number of days.

As I mentioned above, it very well may not be fraud - the real customer may have provided a genuine account number but it was transposed or input incorrectly. They would have to be the missing twin of the OP not to notice that they have not been paying their telephone bill for this long, however.

Teagwee

Marcusm wrote: »

Organising DDs in a manner such as this is to reduce transaction costs and, hopefully, error rates. If all DDs had to be organised by written mandate which was signed by a customer and verified by a human at the bank there would be a lot more cost and a lot more employment in the financial sector!

I understand that DDs need to be organised without written instructions/mandates to be economically viable. However, my biggest concern is that one of the most relevant pieces of information, along with the account number and sort code, surely should be the account holder's name? In the OP's case, the account was set up in someone else's name, hence their inability to obtain further information. This seems ludicrous to me as having the correct name would seem like a very basic check.

Fred Swanson

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Teagwee

Fred Swanson wrote: »

This post has been deleted.

^^^ I understand this now, but I'm appalled :eek: I regularly check my bank account and statements but I know a lot of people who don't, for a variety of reasons. I know it can be said that they're negligent, but many people have a poor understanding of the necessity to do so and/or low basic literacy skills. Not at all suggesting that the OP is in these categories ...

Neeve1234

I agree I should have been more diligent on checking the account. I check for activity on all my US accounts at least twice a week. the fact that the account is only used for mortgage and life insurance payments and I don't use any cards or cheques on it I mistakenly assumed it was ok. the payments come out under the name Hutchinson which led me to think it was associated with my insurance. I feel silly for now for sure.


quote="Teagwee;90732180"]^^^ I understand this now, but I'm appalled :eek: I regularly check my bank account and statements but I know a lot of people who don't, for a variety of reasons. I know it can be said that they're negligent, but many people have a poor understanding of the necessity to do so and/or low basic literacy skills. Not at all supuggesting that the OP is in these categories ...[/quote]

Neeve1234

I agree. on the three thread their Rep David states that if the bank account is in someone elses name other than phone account holder then a signed authorization is required. I have asked three for a copy of that.

Teagwee wrote: »

I understand that DDs need to be organised without written instructions/mandates to be economically viable. However, my biggest concern is that one of the most relevant pieces of information, along with the account number and sort code, surely should be the account holder's name? In the OP's case, the account was set up in someone else's name, hence their inability to obtain further information. This seems ludicrous to me as having the correct name would seem like a very basic check.

Neeve1234

I agree. on the three thread their Rep David states that if the bank account is in someone elses name other than phone account holder then a signed authorization is required. I have asked three for a copy of that.

Teagwee wrote: »

I understand that DDs need to be organised without written instructions/mandates to be economically viable. However, my biggest concern is that one of the most relevant pieces of information, along with the account number and sort code, surely should be the account holder's name? In the OP's case, the account was set up in someone else's name, hence their inability to obtain further information. This seems ludicrous to me as having the correct name would seem like a very basic check.

wmpdd3

I ordered a phone from three online a few years ago, it was a bill phone. I had photocopied my ID and ESB bill , presuming that a contract would come with the phone and I would have to sign it and return the ID like I did when I set up a credit Card online. But no, nothing, all I did was enter a sort code and account number, maybe the name on the account etc, thats it.

I worked in a mobile shop a decade ago and knew what ID was needed, but not anymore.

Hope you get your money back, but i dont hold out hope, queue AIB hinting at collusion with the three account holder.

BazzaDP

Teagwee wrote: »

Do the new SEPA guidelines prevent this from happening from now on, or are we all still at risk of this?

Setting up of DDs is the same under SEPA but the refund process is a lot more in the customers favour - precisely for situations like this.

SEPA allows for any collection in last 8 weeks to be refunded without question. There is a further period (up to 13 months) where unauthorised transactions can be refunded. In theory the company for the DD needs to either agree this is unauthorised or not respond to a request about this.

DDs are incredibly easy to set up since we stop demanding signatures years ago, which leads to cost savings and less hassle for us all but obviously a greater risk. However the protections are in place to deal with the rare occurrences when they goes wrong.

Checking names is not as easy as it sounds. Especially in Ireland with many different spellings and Fadas... etc.

Also you can set up DDs from another account (eg. Parents paying for children's bills or company names... Etc).

Personally I think we have the right balance between ease of set up (for consumer and companies alike) and protection in case of issues. Examples like this are rare or we'd need more checks.