Bank gave reason and sufficient notice for closing customer’s accounts

Categories:

Bank accounts, Closing/Freezing accounts, Chargebacks,

Summary:

In June and August 2025, Caitlyn disputed two credit card payments and asked the bank to seek a refund from the card provider via the chargeback process, which it did. However, she complained about delays in this process and also said bank staff had deleted her emails. On 30 September, the bank told her it intended closing her accounts at the end of the following month because the remarks she had made to staff were discriminatory and disrespectful. The bank closed her accounts on 3 November. Caitlyn sought compensation for inconvenience, harassment and damage to her reputation.

Published:

January 2026

Our investigation

In examining the chargebacks, we learned the bank had temporarily halted the first process because Caitlyn and the merchant were in mediation over the purchase, and the merchant had agreed to refund her directly. When the refund did not happen, the bank resumed the chargeback process. Delays arose because of a problem with the bank’s internal emails, which the bank acknowledged and apologised for. We found no evidence staff had deleted any of her emails. However, Caitlyn received her money back for both purchases, and she therefore suffered no loss or, in our view, any significant inconvenience.

As for the closure of her accounts, the bank gave a month’s notice and explained its reason: that her remarks about bank employees were disrespectful and discriminatory. The bank’s terms and conditions allow it to close a customer’s accounts after giving 14 days’ notice, and the Code of Banking Practice requires banks to act fairly and reasonably by giving, wherever possible, a reason for closing an account. The bank gave both adequate notice and a reason for the closure. The bank therefore acted fairly and complied with its obligations. Caitlyn had an authority to operate on her parents’ accounts, and the bank also ended this service, which it was entitled to do, with proper notice. Again, it gave this notice. We considered the bank had reasonable grounds to consider her comments about its staff were disrespectful and discriminatory. We found no evidence that the bank’s decision to end its relationship with Caitlyn was retaliatory. No apology or compensation was therefore necessary.