Questions of Cash: I lost out when cash machine failed to deliver

Q. In May last year in Sao Paulo I tried to withdraw £919 in cash from my Citibank account, but nothing came out of the ATM.

Q. In May last year in Sao Paulo I tried to withdraw £919 in cash from my Citibank account, but nothing came out of the ATM.

When I checked my account, I found the sum had been deducted, so I contacted the bank and it was reinstated - the same thing had happened before. But Citibank later took back the refund, implying the machine had delivered. There was a witness from the charity which would have received the money. What redress do I have?
PB, by e-mail.

A. Your claim is that you made five attempted withdrawals in Brazil, which were debited to your account but for which you did not receive the cash.

Citibank firmly rejects your claim, saying that its records indicate that you received the money. Its audit trail for the cash machine for the day in question shows the cash machine balanced at the end of the day. A spokeswoman says: "Citibank will credit customer accounts where fraud or technical issues leave them out of pocket, as demonstrated by the credits previously made to your reader in a claim he made in 2003. However Citibank will not credit accounts when our computer and financial records clearly demonstrate that cash has been validly dispensed." The bank says that it has complete confidence in its systems and staff in Brazil.

Your story underlines the risk attached to the use of cash machines, especially if making high-value withdrawals. In your case, you may have repeatedly attempted to make a withdrawal after initially failing in your attempt to obtain cash. We would advise against this practice - if a machine does not pay out first time then move to another machine or use a bank branch, rather than assume that it will eventually work and that your account will not be debited. If possible, lodge a complaint immediately where an ATM indicates it has provided cash but has not done so, without waiting to see if the money is taken from your account.

Before taking further action you must consider whether you might have been distracted while using the cash machine and fallen victim to fraud. In some disputed transactions, apparently, cash has been dispensed after people gave up waiting for a machine to work and walked away.

Assuming that you are confident that the fault lies with Citibank you should pursue your case by lodging a complaint with the Financial Ombudsman Service - which can consider the case if your Citibank account was held in the UK. It will apply a balance of probability test, after obtaining evidence from Citibank in Brazil.

You cannot be optimistic about the outcome of the FOS complaint, but a court would apply a similar test. Dilys Trethowan, a partner specialising in financial services at law firm Bevans, suggests that you ask your witness to make a witness statement in front of a solicitor and consider what other evidence you have to support your case. You should use this in your claim to the FOS. Ms Trethowan suggests you also investigate whether you might have grounds to claim on your travel insurance and any policies held by your employer.

Q. My wife and I have a joint account at the Co-operative Bank because we thought it had ethical principles. We have an overdraft facility of about £1,500, but this is subject to a reducing balance "to help reduce our debt". This is confusing because we are never sure what overdraft limit we are supposed to work to and often accidentally exceed it. The overdraft has to be renewed every eight months, after which all cheques are bounced and direct debits are charged at £35 per item. Yet the bank sends no written reminder that the overdraft needs renewing. I have now been charged £105 because an electronic transfer from another bank did not arrive on time and the direct debits fell due.
TS, Cornwall

A. The Co-operative Bank says that overdrafts should not be used as long-term debt facilities, as they are not cost effective for this. Fixed-term loans are cheaper. It says your overdraft was provided to assist you in reducing your level of debt as part of its policy of responsibile lending and debt management. You should pursue a complaint with the second bank if its poor service caused you a financial loss.

Q. My sister has been pursued by her former financial advisor Robert Sterling and now by a credit recovery agency on its behalf for unpaid commission on a Legal & General policy she stopped when she remortgaged. We cannot find any commitment made by her to pay this sum. DB, by e-mail.

A. Robert Sterling has agreed to write off the disputed debt.

Q. I have a £1,000 limit on my Egg credit card and when I tried to raise the limit to £5,000 this was rejected. But I have now received an e-mail from Egg offering a guaranteed £25,000 loan.If I am good for a £25,000 loan, why aren't I good for more than £1,000 on the credit card?
RB, Leeds.

A. Your initial £1,000 credit card limit was set by you to prevent overspending by your wife on her associated card. Egg advises that once a customer sets their own limit this can only be changed by personal request by phone or letter, not online as you tried to do. Unfortunately, the e-mail sent to you by Egg did not explain this and it accepts that it could improve its systems to make the situation clearer. Egg will increase your card's credit limit to £8,000 if you phone the bank to request this.

* If you have questions, write to Questions of Cash, 'The Independent', 191 Marsh Wall, London E14 9RS, or e-mail We can reply only to letters published. Please send copies, not originals.

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