Reply to: MVL: Metro Bank not releasing my funds for 2 months

[sira]

Some success to report on my part. After having a stiff word (and "stiff" is an understatement) with Metro & my liquidator this morning, my liquidator magically sends me an email saying funds have been received. Just need to wait for the liquidator to conduct the distribution process now, which should circa 1 week.

Going through this process during a pandemic and barbaric recession is extremely stressful. Especially given that it's not a small sum of money. I'll never be using Metro bank ever again.

[Maslins]

Or try smashing their twitter account. Seems to have worked in some instances.

Not a bad idea...though be v wary of fraud if you do this! I errr...have a friend...who complained about a bank publicly on Twitter. Some scammer saw the tweet, got a phone number from website listed in their profile, and called up saying they were from the bank's complaints team and keen to help (by which I mean encourage you to voluntarily give them enough info so they can steal your cash).

[sira]

I'm pretty sure they can't just hold your money for an indefinite period of time. And under CASS rules the money needs to be segregated from the banks own money. At the end of the day, we have no clue what their doing with the money or why they are holding onto it this long.

I work in financial regulation personally, but don't have expert knowledge in CASS unfortunately. This is something the FCA would definitely take an interest in if enough people complain, but I suspect we won't get enough collective complainants.

Spoke to my liquidator today and they said that Metro Bank has asked them not to chase up for 2 weeks and wait for the cheque. I'll wait 2 weeks before re-opening my complaint with Metro Bank and informing them that I intend to inform the FCA and threaten legal action, because it's getting beyond absurd. Some people are waiting on very large sums of money, they cannot simply withhold it for an undefined and indefinite period of time.

I also nabbed the specific teams email address if anybody needs it: [email protected] Although be warned, they won't respond to emails quickly, or may not respond at all.

[northernladuk]

To those badly impacted I'd recommend raising a formal complaint with the bank. It seems to ensure someone reasonably senior follows it through to completion (rather than just the front line customer service person saying it'll be dealt with then nothing further happens). On occasion you may get compensation too, though typically a modest sum. Also I believe that if they're getting a lot of complaints about a specific area, they're more likely to allocate more staff/resources to improving it. This may not help your case directly, but may reduce the problem for future people doing the same as you.

We (MVL Online) raised a complaint with the Financial Ombudsman against Tide after the bank ignored our "normal" requests and formal complaint. This was middle of last year (and Tide have since processed the case in question). Typically once every 2-3 months we hear from the Ombudsman with some daft question for us. In short, I don't think I'd bother attempting to go via the Ombudsman again. It's a shame as I had thought they were supposed to be for exactly this purpose.

I have no idea re other routes.

Or try smashing their twitter account. Seems to have worked in some instances.

[Maslins]

To those badly impacted I'd recommend raising a formal complaint with the bank. It seems to ensure someone reasonably senior follows it through to completion (rather than just the front line customer service person saying it'll be dealt with then nothing further happens). On occasion you may get compensation too, though typically a modest sum. Also I believe that if they're getting a lot of complaints about a specific area, they're more likely to allocate more staff/resources to improving it. This may not help your case directly, but may reduce the problem for future people doing the same as you.

We (MVL Online) raised a complaint with the Financial Ombudsman against Tide after the bank ignored our "normal" requests and formal complaint. This was middle of last year (and Tide have since processed the case in question). Typically once every 2-3 months we hear from the Ombudsman with some daft question for us. In short, I don't think I'd bother attempting to go via the Ombudsman again. It's a shame as I had thought they were supposed to be for exactly this purpose.

I have no idea re other routes.

[sira]

I am also undergoing MVL at the moment with Metro Bank. My proceedings started early December. I complained to Metro Bank but they said they cannot legally discuss anything with me. After I complained, apparently Metro Bank reached out to my liquidator to say the cheque would be sent out last week, but theres still been no cheque or news from Metro Bank.

The liquidation team at Metro Bank dont have a phone number, you can only email them. And even then, they take an eternity to respond to emails.

There must be some sort of law(s) which safeguards clients when banks hold our money for excessive periods of time? The CASS client money rules come to mind. Anyone have any idea? Clients must be able to take some sort of legal action against banks in these circumstances.

[mike78]

How interesting, thank you. If MVL Online were to offer this, they'd be clear winners for me and, possibly, for many other company directors.

yes that would be really good option

[bcontractor]

It was this I think:
https://www.contractoruk.com/forums/...ght=mvl+specie

and it was a genuine concern due to HMRC's usual ambiguity and desperation.

But HMRC have since clarified the ruling as per:
https://www.contractoruk.com/forums/...ght=mvl+specie

A lot of contractors (and other businesses) are keen to liquidate and get funds -or at least confirmed distributed dates- this tax year due to government taking the p1ss with their rumblings on CGT. I really don't expect BADR to be impacted, and neither does my accountant, but any increase in CGT will create a huge difference between CG rates and the 10% BADR rate. I can't imagine any business owner risking a life's worth of savings on the risk that HMRC might at a whim increase the BADR rate or remove the allowance altogether.

How interesting, thank you. If MVL Online were to offer this, they'd be clear winners for me and, possibly, for many other company directors.

[ChimpMaster]

Re opening a new bank account shortly prior to liquidation...I don't know. It may be quite a lot of faff, and possibly the "new" bank may not be best pleased!

Re the final point, that's a bit different to what I think was being talked about above (at least by me!). I think what you're talking about is you transfer money from your company bank account to your own personal bank account, so it doesn't go via the liquidator. This certainly reduces the risk in terms of funds going astray (eg either nasty typo muck up or "liquidator" is actually a scammer).

I'm sure we did consider this option some time ago, and decided against it...though I can't 100% recall why. I think there was some nervousness over the legality of it with the timing. Ie either you're doing the transfer shortly before liquidator appointment, in which case you're fine to do so (you still control the company), but is it really a distribution from the liquidation...or you're doing it shortly after, in which case you shouldn't be able to and only are able to due to delays for banks to find out about the liquidation. Being honest I can't imagine HMRC ever challenging the point, but it seems more proper that funds actually go via the liquidator to make it abundantly clear that it was part of the liquidation.

It was this I think:
https://www.contractoruk.com/forums/...ght=mvl+specie

and it was a genuine concern due to HMRC's usual ambiguity and desperation.

But HMRC have since clarified the ruling as per:
https://www.contractoruk.com/forums/...ght=mvl+specie

A lot of contractors (and other businesses) are keen to liquidate and get funds -or at least confirmed distributed dates- this tax year due to government taking the p1ss with their rumblings on CGT. I really don't expect BADR to be impacted, and neither does my accountant, but any increase in CGT will create a huge difference between CG rates and the 10% BADR rate. I can't imagine any business owner risking a life's worth of savings on the risk that HMRC might at a whim increase the BADR rate or remove the allowance altogether.

[Maslins]

Is the option of opening another business account with a faster bank and transferring the money actually a suitable one?

Finally a question for @Maslins: the majority of liquidators seem to prefer a Day 1 distribution with the director instructing the payments themselves. Is it really that controversial? Their argument is that they would have been appointed as liquidators already by then, so they can instruct the director to make the payments.

Re opening a new bank account shortly prior to liquidation...I don't know. It may be quite a lot of faff, and possibly the "new" bank may not be best pleased!

Re the final point, that's a bit different to what I think was being talked about above (at least by me!). I think what you're talking about is you transfer money from your company bank account to your own personal bank account, so it doesn't go via the liquidator. This certainly reduces the risk in terms of funds going astray (eg either nasty typo muck up or "liquidator" is actually a scammer).

I'm sure we did consider this option some time ago, and decided against it...though I can't 100% recall why. I think there was some nervousness over the legality of it with the timing. Ie either you're doing the transfer shortly before liquidator appointment, in which case you're fine to do so (you still control the company), but is it really a distribution from the liquidation...or you're doing it shortly after, in which case you shouldn't be able to and only are able to due to delays for banks to find out about the liquidation. Being honest I can't imagine HMRC ever challenging the point, but it seems more proper that funds actually go via the liquidator to make it abundantly clear that it was part of the liquidation.

[bcontractor]

Useful to see the timelines mentioned in previous threads. I bank with Santander, so I'd be in very slow end of the spectrum.

Is the option of opening another business account with a faster bank and transferring the money actually a suitable one?

Finally a question for @Maslins: the majority of liquidators seem to prefer a Day 1 distribution with the director instructing the payments themselves. Is it really that controversial? Their argument is that they would have been appointed as liquidators already by then, so they can instruct the director to make the payments.

[MrButton]

Yeah Metro took 2-3 months to transfer the money to MVL Online, and they do it by cheque.

I would say MVL Online were great at keeping me in the loop and chasing Metro all the time for updates.

[Maslins]

Would have been a better move if I manually transfer the funds to the liquidator on the date of the liquidation?

We do hear clients suggest this sometimes, but as a firm we're against it for a few reasons:
1) if you do it before the liquidator is legally appointed, you're voluntarily sending money to a third party who has no legal relationship with your company.
2) if you do it imminently after the liquidation is legally appointed, legally you're doing something you don't have the authority to do.
3) realistically unless you wait a while after liquidator appointment, they won't have a bespoke estate account set up to house your company's funds. You're therefore at best putting your money into an account potentially mixed with lots of other client funds.
4) the above assumes no fraud...but of course you've got the risk that the "liquidator" is actually a scammer. If you voluntarily send all your money to a third party, and it later transpires that was a daft move, your bank is unlikely to be sympathetic.
5) potentially there's no fraud but you make a daft mistake, a typo in the bank details, and funds go astray. Again, you're unlikely to have much comeback against liquidator or bank, assuming it was your mistake.

Yes, some of the banks are making the normal best practice painfully slow. However, doing it this way reduces the risk.

To anyone else reading this, some liquidators will recommend you transfer the balance to them around the time of their appointment. This doesn't necessarily mean they're dodgy, and from a practical perspective can lead to you getting your funds quicker. However, do ensure you've done your due diligence on the liquidator firm first, and take great care when instigating the transfer.

[Syd]

Would have been a better move if I manually transfer the funds to the liquidator on the date of the liquidation?

[eek]

MVL Online have very much seen a split in banks since Covid started:

- Barclays/Cater Allen - brilliant, will turn round our requests typically within 1-2 working days (means first distribution in ~2 weeks after appointment, as we need to open estate bank account first which takes a little while).

Credit also to Monzo, Starling, Lloyds, NatWest and others. Not as fast as the above, but will typically turn around our requests within a few weeks.

- HSBC/Santander/Metro Bank/Tide - terrible, 2+ months on we'll still be chasing them. We've raised formal complaints re all these banks in the last few months. Their response is typically just "Covid", "backlog", "doing all we can". I had some sympathy in the first month of the first lockdown, but we're 9+ months after that now. To still be well behind is simply not making any effort to resolve the problem.

We did end up going beyond "internal" formal complaint and raised one complaint to the Ombudsman, against Tide, middle of last year. To date all we've had is a periodic request for further information. 6 months on zero progress in terms of the Ombudsman complaint (of course Tide did eventually action our request). Therefore doing this again seems utterly pointless.

Afraid there's not much you/the liquidator can do. They/you will get funds eventually, but it's entirely in the bank's control. Some of the banks don't seem to care, and there's essentially no negative consequences for them. It sucks.

So the best advice would be to switch to Cater Allen / Mondo / Starling and move all the money there before starting the MVL process.