Our investigation
We reviewed the account opening authority and considered it did not specifically allow for one person to be able to unilaterally open new accounts. We found the bank breached the account mandate as well as its Code of Banking Practice obligations by not using plain language or communicating with customers clearly and effectively. However, if a mandate for a joint account clearly allowed one person to instruct the bank to open a new account, the bank would usually be entitled to act on one person’s instructions only, unless the bank was aware of changed circumstances, such as the parties had separated.
Outcome
We recommended the bank pay Stefan $750 in compensation for inconvenience.
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