17 February 2009
There is evidence that banks are accessing customer's current accounts to recover credit card and loan debts, Citizens Advice has claimed.
Social policy officer Tony Herbert said banks have been using what is known as the right of set off to retrieve money owed.
While they are legally able to do this under certain conditions, Mr Herbert said some banks are leaving customers in a financially vulnerable position by doing so.
"This practice is hitting some of the poorest and most vulnerable particularly hard since they can have all their benefit income taken, leaving them unable to pay priority debts such as mortgages and council tax," he explained.
Mr Herbert said Citizens Advice is therefore urging banks to stop this practice and to treat their customers fairly.
According to the Financial Ombudsman, banks are expected give their customers a reasonable opportunity to repay their debts before using the right of set off.