Is debiting a bank account without authorisation illegal?

Question

Paypal Europe has tried to debit money from my bank account without any authorisation from me. Further, their term and conditions did not authorise such a thing. Is this illegal or against usual policy in banking law? And if so, whose the best authority to make a complaint to? Thank you.

The bank refused the transaction, so that's not the problem. I just want to know if they've violated the law and if so who to report this to. They're acting quite dodgy.

Answer 1

I believe the whole matter of debiting accounts would come under Regulation E of the Federal Reserve Bank, because it involves a pre-authorized transfer. Under section 205.6, Liability of consumer for unauthorized transfers, you are not liable for unauthorized transactions. However, it looks like you would have to monitor your account to be safe.

American financial institutions are supposed to provide you with annual notice of how errors are to be resolved. http://www.bankersonline.com/regs/205/205-8.html The form of notice is contained in Model Form A-3.

I would begin complaining at your bank. Begin with the branch manager. If he or she isn't doing what you think he should, ask to speak to somebody in the bank compliance department. The next step would be to file a consumer complaint with the Federal Regulator in charge of regulating your bank.

The complaint should be submitted in writing and should include the following:

* Complainant's name, address, telephone number;
* The institution's name and address;
* Type of account involved in the complaint--checking, savings, or loan--and account numbers, if applicable;
* Description of the complaint, including specific dates and the institution's actions (copies of pertinent information or correspondence are also helpful);
* Date of contact and the names of individuals contacted at the institution with their responses;
* Complainant's signature and the date the complaint is being submitted to the regulatory agency.

The target of your complaint, depending on who regulates your financial institution, would be one of the following:

Board of Governors of the Federal Reserve System
Division of Consumer and Community Affairs
20th & Constitution Avenue, NW
Washington, DC 20551

Federal Deposit Insurance Corporation
Division of Supervision and Consumer Protection
550 Seventeenth Street, NW
Washington, DC 20429

Office of Thrift Supervision
Consumer Affairs Office
1700 G Street, NW
Washington, DC 20552

National Credit Union Administration
Office of Public and Congressional Affairs
1775 Duke Street
Alexandria, Virginia 22314-3428

Office of the Comptroller of the Currency
Customer Assistance Group
1301 McKinney Street
Suite 3710
Houston, TX 77010

Federal Trade Commission
Bureau of Consumer Protection
Office of Credit Practices
Washington, DC 20580

Answer 2

In the USA it's highly illegal. The FDIC regulates that here. What is the equivalent in Europe to the Federal Banking Commission?

Answer 3

There will be a penalty for terminating the service early, so you will not be getting a refund. The manner in which they took the money is the question. The answer can be found most likely on the back of their contract in fine print. I am willing to bet it states that they are able to use any information disclosed to them for billing purposes. It is you obligation to read the contact before you sign it. Contracts are legally binding. The man doing the installation, is probably a contractor, and unable to create a legally binding verbal contract between yourself and the company.

Answer 4

call your bank and cancel pay pal