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★☆☆☆☆

“Bogus Balances and Higher Direct Debits”

written by mikeydw on 27/04/2014

I have never posted on one of these places before, but with my current experiences of K & Co, which is Shop Direct, I must warn people about their Direct Debit Payments being taken each month, when a consumer buys all their items on Buy Now Pay Later.

I merely assumed by continuing my DD payments, and paying off the full item balance before the item matured, so no interest was charged on the item, that this DD payment would reduce the overall balance on my account and subsequently, any up and coming BNPL item.

This is incorrect. So incorrect that all those monthly payments made on time were in fact going straight into Shop Direct's account, and no reduction in balance on my items purchased.

In one case, their statement said my direct debit would increase to £20.90 to reflect my buy now pay later item due for maturity within the next statement. I have documented evidence that not only did shop direct ( K&Co ) take my £20.90, I also paid in full the BNPL item of £177 before maturity, thus avoiding the interest being applied.

Not only this, prior to this payment of £20.90 and paying for the BNPL item, I had a balance on account showing as £5. As mentioned, I had to wait until this balance was near zero to know what they were doing.
After the £20.90 and £177 was paid I checked my next statement. I had a balance on account of £365!! People WATCH OUT. BUSTED!! They have been increasing my account balance to justify the regular DD payments. No items were purchased, all items paid in full before interest could be applied, so where does £365 come from? I am now in a legal battle to force them to provide evidence of my account balances/payments/interest charges.

I have checked and re-checked, the £20.90 has reduced nothing, disappeared into their account. I suspected this was happening, and deliberately purchased all items via BNPL for the last 18 months, which means any initial balance had been paid in full, which left only BNPL items, which I have paid off in full before interest was applied.

This means the last 12 months DD payments, which varied, as explained above, totalling nearly £270 has been paid to them, overpaid to them.

I knew I had to clear any previous 20 weeks purchases before being able to spot this error with their system, hence it has taken well over a year to be in the position to formally complain to them, as you cannot take monthly DD unless it actually reduces the purchase cost of a BNPL item. It had not and I have the proof.

What did they do when I made my complaint? After 2 initial phone calls each lasting over an hour each, total denial, saying someone senior will call me back, never did.
One adviser advised me to reclaim the DD via my bank and under the DD scheme, so I did.

What did they do? They applied all 12 monthly payments reclaimed by me back to my account then sent me an arrears demand, plus £400 bogus interest payments reapplied to my account.

Obviously I called them up, angry, dismayed, appalled, and quite frankly shocked at the arrogance, total denial they had been taking payments from me when they should not and refusing to investigate my claims, even after providing hard written evidence.

I might add, I am a Managing Director of a UK Limited Company, a customer of 7 years with them, and never missed a payment in my time with them, other than my total refusal to pay their arrears charges they are now claiming because I took back my monthly payments that were going straight into their coffers!!.

I would recommend anyone who applies their account as I do, by purchasing from a catalogue on BNPL only and ensuring all items are paid before interest is applied, to check their statements carefully, the fault is with their automated system, it increases a DD payment before the BNPL item has matured, if you pay this item in full, the monthly DD does not reduce anything, it goes nowhere, it is in fact you giving them free monthly money.
When you point this out to them, they threaten you with court action to recover monies that they had no claim on in the first place.

I had 2 items left on BNPL at this point when they refused to investigate fully my findings, totalled nearly £1100, I called them up and stated I wish to pay in full any items left on my account, including the bogus £270 12 months DD payments which I accepted I will have to seek compensation through the courts, I was told instead of £1370 to close my account, I had to pay them £1700!!
I cannot write here what I told that customer service person, but I can assure you I gave that person an earful.

I went on-line on their account, I paid in full the 2 items, and I am now in a legal battle to dispute the bogus charges they have applied to my account. What bother's me the most, is it matters not that you conduct your account in a good manner, loyal customer for 7 years, what bother's me the most is a company taking my hard earned money via DD every month when they were never entitled to do so, and when this is brought to their attention their first response is to threaten you with court action to recover monies they are not entitled to.

People beware, if this has happened on my account with their automated statement calculator, it is happening to many thousands of people. Your money is being taken from your accounts, it could well be far more than you should be paying.

If this review allows it, I will update any outcome so people can make valid decisions about who they sign contracts with.

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