Lloyds Bank PLC · DRN-6253551

The complaint Mr C complains Lloyds Bank PLC (“Lloyds”): • Closed his accounts and did so without providing reasonable notice • Unfairly limited access to his funds • Provided inadequate communication and handled his complaint poorly • Failed to provide a reasonable way for him to retrieve his funds other than coming into branch or having cheques posted to his UK address when it knew he was working abroad Mr C says Lloyds’ actions led to his regular payments not being met causing him to incur penalties and charges; and posing a risk to his credit file. To put things right, Mr C wants: - His funds released through secure electronic transfer - Any penalty fees caused by cancelled direct debits refunded - Reimburse Mr C’s travel costs - Compensation for the distress and inconvenience caused - Conformation Mr C’s credit file hasn’t been impaired - A formal apology What happened The details of this complaint are well known by both parties, so I won’t repeat them again here. Instead, I’ll focus on giving my reasons for my decision. I will however add, that after our Investigator didn’t uphold Mr C’s complaint, Lloyds sent Mr C another final response letter in December 2025. In summary, Lloyds upheld that complaint and made the following key points: • Lloyds is sorry Mr C wasn’t made aware, as outlined in the notice to close letter, that he could request the money in the accounts to be transferred to another person of his choice • Lloyds should also have explained that when Mr C visited a branch, Lloyds would need to cancel any cheques that had been issued and arrange for the funds to be transferred to the branch for collection • Lloyds has transferred Mr C’s funds, and they are in a Lloyds branch close to Mr C Lloyds also said it would pay Mr C £100 for the trouble and upset its actions have caused him, and £25.44 interest at 8% for the time Mr C was deprived of access to his funds. Lloyds says this was calculated from 6 November 2025 until 31 December 2025 to allow Mr C time to visit the branch. Lloyds also deducted some tax from the interest in line with its obligations.

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I then sent both parties my provisional decision in which I said I was planning on upholding this complaint in part. For ease of reference, here is what I said: Provisional decision “I’m very aware that I’ve summarised the events in this complaint in far less detail than the parties and I’ve done so using my own words. No discourtesy is intended by me in taking this approach. Instead, I’ve focussed on what I think are the key issues here. Our rules allow me to do this. This simply reflects the informal nature of our service as a free alternative to the courts. If there’s something I’ve not mentioned, it isn’t because I’ve ignored it. I’m satisfied I don’t need to comment on every individual argument to be able to reach what I think is the right outcome. I do stress however that I’ve considered everything that Mr C and Lloyds have said before reaching my decision. I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. Having done so, I am planning on upholding this complaint in part. I’ll explain why. Banks in the UK, like Lloyds, are strictly regulated and must take certain actions in order to meet their legal and regulatory obligations. They are also required to carry out ongoing monitoring of an existing business relationship. That sometimes means Lloyds needs to restrict, or in some cases go as far as closing, customers’ accounts. What is key here is that Mr C treated messages from Lloyds whilst he was working abroad as potentially scams or phishing attempts given what he says was a lack of the typical branding he expected from Lloyds. Mr C has provided a screenshot of what this message looked like. Given they clearly say the messages being sent to him are important and need urgent attention, I would have expected Mr C to have called Lloyds particularly as he was abroad. As Lloyds didn’t hear from Mr C, Lloyds proceeded to close his accounts with some limitations on them. Lloyds gave Mr C 65 days’ notice. This is in line with the terms of the accounts. As there were some limitations on the accounts during this notice period, it may be argued that the closures were effectively immediate. But given Lloyds were trying to fulfil its Customer Due Diligence obligations in attempting to garner information about Mr C’s account activity, I think the way it closed his accounts was fair. I note Mr C accepts that Lloyds had legitimate basis in which to close his accounts, but says the way Lloyds handled his complaint, prevented access, and didn’t transfer the funds through reasonable means was disproportionate and unfair. Having carefully considered the information I’ve been given; I agree that Lloyds’ actions in helping Mr C recover his funds was poorly handled. Because of this, I also agree that it’s complaint handling in relation to this matter fell short. Mr C made it clear the moment he realised his accounts were closed through the non- functioning of his account cards that he was abroad and couldn’t visit a branch immediately. Given he also said he didn’t access the closure notices, Lloyds’ staff should have offered him an alternative method of electronically sending him his funds. That means Mr C was unfairly deprived of access to his funds for longer than he should have.

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Mr C wants his direct debit fees and charges refunded – but that happened solely because the accounts closed. And I’ve said Lloyds acted fairly in closing the accounts. Mr C has also said he was able to borrow money to make payments. Mr C has said any potential travel should be reimbursed. But I don’t agree as he visited the branch when he had already planned to return to the UK in mid-December 2025. Lloyds has already apologised in its latest final response which relates to the underlying events of this complaint. So, I don’t think it needs to do anymore in relation to issuing Mr C with an apology. I note Lloyds has paid Mr C compensation for the period he was unfairly deprived of access to his funds by paying him 8% simple annual interest. And it paid him £100 for the distress and inconvenience its actions have caused. But I think this amount falls short given Mr C had to make several international calls and was audibly distressed by Lloyds’ communication and complaint handling failings – including in the main, not offering an alternative means to recover his funds. Because of this I am planning on awarding Mr C £350 for the distress and inconvenience. That is, £250 more than what it appears Lloyds have already paid Mr C. Putting things right To put things right, I am planning on directing Lloyds to: - Pay Mr C 8% simple annual interest on the balance of all his funds Lloyds were holding from the moment his accounts were closed until he was able to get the funds released to him*. If Lloyds has already done this as it says, then it doesn’t need to do anymore - Pay Mr C a total of £350 for the distress and inconvenience its actions caused. If Lloyds has already paid Mr C £100, it only needs to pay him a further £250” The deadline for both parties has now passed. Mr C has agreed with what I said and says he has nothing further to add. Lloyds has not responded. I will now decide this complaint. What I’ve decided – and why I’ve considered all the available evidence and arguments to decide what’s fair and reasonable in the circumstances of this complaint. For the reasons in my provisional decision, see above, I have decided to uphold this complaint in part. Putting things right To put things right, I am planning on directing Lloyds to: - Pay Mr C 8% simple annual interest on the balance of all his funds Lloyds were holding from the moment his accounts were closed until he was able to get the funds 0released to him*. If Lloyds has already done this as it says, then it doesn’t need to do anymore - Pay Mr C a total of £350 for the distress and inconvenience its actions caused. If Lloyds has already paid Mr C £100, it only needs to pay him a further £250 * If Lloyds considers that it’s required by HM Revenue & Customs to deduct income tax from that interest, it should tell Mr C how much it’s taken off. It should also give Mr C a tax deduction certificate if he asks for one, so he can reclaim the tax from HM Revenue & Customs if appropriate.

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My final decision For the reasons above, I have decided to uphold this complaint in part. Lloyds Bank PLC must now put things right as directed above. Under the rules of the Financial Ombudsman Service, I’m required to ask Mr C to accept or reject my decision before 23 April 2026. Ketan Nagla Ombudsman

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