Page 1 of 2 1 2
Thread Options
#2018311 - 06/04/15 02:05 PM Terminating debit card - How would you handle this
amberleigh Offline
Junior Member
Joined: May 2011
Posts: 34
Kansas
Husband and wife have a joint account. Wife calls in late in the day and wants to close husband's debit card so he can't withdraw her paycheck that is set to be direct deposited that night. She says he is getting out of jail. Would you close the debit card? There is only $2 in the account at the time, but her direct deposit should memo post and be available for withdrawal sometime in the middle of the night.

Return to Top
Deposits and Payments
#2018315 - 06/04/15 02:17 PM Re: How would you handle this?? amberleigh
osucpa Offline
Diamond Poster
Joined: May 2011
Posts: 1,395
Under your senario, I would have the wife close the account and establish a new account. The new account with be an individual account.

Return to Top
#2018320 - 06/04/15 02:22 PM Re: How would you handle this?? amberleigh
amberleigh Offline
Junior Member
Joined: May 2011
Posts: 34
Kansas
She was advised to do that a week ago and never did it. When she called yesterday to make the request, she was told she could come through the drive through to close the account and could open a new account in her own name the next day and we would re-route the deposit to her new account. She didn't do that either. Husband withdrew all the funds at 4:00am. Her solution was to just close his card which I felt put the bank in the middle of their domestic dispute especially since she saw this coming for a week and chose not to handle it herself. I just wasn't sure about closing a card for someone at the request of another joint owner....

Return to Top
#2018375 - 06/04/15 03:22 PM Re: How would you handle this?? amberleigh
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 77,016
Galveston, TX
Why in the world did you not just immediately cancel all debit cards, close the account and mail her a check??

I think the bank is liable for failure to act on the customer request. This is not a his card - her card issue. You received a legitimate request from a joint account holder on an account on which they are both jointly and severely liable.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2018418 - 06/04/15 04:32 PM Re: How would you handle this?? amberleigh
amberleigh Offline
Junior Member
Joined: May 2011
Posts: 34
Kansas
I guess the bank should have made the decision to close the account ourselves even though she was told she could close the account which would prevent him from withdrawing the money. Since she didn't want the account closed and wanted to leave it open for whatever reason we didn't think she could request for his card to be closed without the account being closed as well. If I'm understanding you correctly, any joint owner can close another joint owner's card at any time?

Return to Top
#2018419 - 06/04/15 04:34 PM Re: How would you handle this?? amberleigh
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
Originally Posted By rlcarey
I think the bank is liable for failure to act on the customer request. This is not a his card - her card issue. You received a legitimate request from a joint account holder on an account on which they are both jointly and severely liable.

Are you suggesting that any owner of a joint account should have the right to cancel another owner's card simply because they don't want the joint owner to have access to the account?

I'm sorry- I simply do not agree with this.

Return to Top
#2018440 - 06/04/15 04:58 PM Re: How would you handle this?? amberleigh
Doug Hendrickson Offline
Power Poster
Doug Hendrickson
Joined: Oct 2009
Posts: 3,927
I think Randy brings up a good point. As far as I understand, he is not saying that a joint owner has the right to cancel another joint owner's card. He is simply stating that given the goal that the woman had in mind, he outlined a reasonable, and perhaps the best course of action given the circumstances. This is a legitimate case of going that one extra step for a customer.
_________________________
I hear and I forget. I see and I remember. I do and I understand.--Confucius

Return to Top
#2018444 - 06/04/15 05:02 PM Re: How would you handle this?? amberleigh
amberleigh Offline
Junior Member
Joined: May 2011
Posts: 34
Kansas
But she didn't want the account closed at that point, she just wanted his card closed. Had she said she was out of town and couldn't come in to close it herself or something, then we could have closed the account per her request (even though we normally require a signature).

Return to Top
#2018464 - 06/04/15 05:38 PM Re: How would you handle this?? amberleigh
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
Yes, the bank could have chosen to close the account. And in hindsight, it may have been wise to do so simply to avoid getting caught in the middle of this dispute.

But since the account had not been compromised, and there is no suggestion in the original post that the customers were doing anything that could have caused a loss to the bank, the bank made the decision that I believe most of us would have in this case. They advised the customer of the risks associated with operating a joint account, and gave her recommendations for dealing with the issue.

I'm sure all banks get requests like this fairly regularly. I know I have assisted in several conversations where customers sought to limit the access of joint owners. It's really not that unusual.

In the end, the bank simply has no liability in this situation, becuase there is no injury.

Return to Top
#2018882 - 06/07/15 03:20 AM Re: How would you handle this?? amberleigh
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 77,016
Galveston, TX
I would highly suggest that you all go back and read your account agreements. These are not his and her cards and any instruction from a joint account holder is binding on both of them and for the bank to ignore the request to cancel the card for any reason is a breach of contract. The bank is liable for not acting on her instructions. If she chose to not close the account and he wiped it out some other way __ well so be it. However the bank was properly notified of the request.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2018891 - 06/08/15 02:18 AM Re: How would you handle this?? amberleigh
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
The bank is liable to whom for what? There is no injury.

Return to Top
#2018897 - 06/08/15 12:02 PM Re: How would you handle this?? amberleigh
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 77,016
Galveston, TX
Well, when the poor woman stands in front of the judge and say I told the bank to cancel the card and they refused and a few hours later my deadbeat husband wiped out my paycheck/account and therefor I didn't have the rent money to keep a roof over my head, we will see who was injured.

The point being, the bank screwed by not canceling the card.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2018903 - 06/08/15 12:49 PM Re: How would you handle this?? amberleigh
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
The husband withdrew money from his own account.

Return to Top
#2018905 - 06/08/15 12:53 PM Re: How would you handle this?? amberleigh
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
Does either party have the right, under a joint deposit account agreement to terminate the agreement (by closing the account)? Yes.

Does either party have the right to amend the rights and/or access of the other party to the agreement without their consent? I don't know of any deposit account agreement that would allow for this.

Return to Top
#2018908 - 06/08/15 12:54 PM Re: How would you handle this?? amberleigh
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 77,016
Galveston, TX
I am sure your depositor's agreement states the following, if it doesn't then you have a defective depositor's agreement:

"Each co-owner acts as the agent of each other co-owner. Each co-owner authorizes each other co-owner to operate the account without the consent or approval of any other co-owner."

So you are saying that the failure of the bank to act on the instructions of one party is not a breach of contract???
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2018992 - 06/08/15 03:39 PM Re: How would you handle this?? amberleigh
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
I'm saying the instruction in this scenario is not valid, because it contradicts the very clause you are quoting.

"Each co-owner acts as the agent of each other co-owner. Each co-owner authorizes each other co-owner to operate the account without the consent or approval of any other co-owner."

This gives the husband the ability to use his card to access the account without the wife's approval. The wife, by asking the bank to restrict the husband's access, is attempting to apply a condition of approval to the husband's continued use of the account that this clause, which both parties agreed to, explicitly states is not needed.

Honoring the wife's request would actually invite a very valid claim from the husband. The bank agreed to provide him access to his account without his wife's consent, but in practice limited his access contingent on her consent.

Return to Top
#2019010 - 06/08/15 04:17 PM Re: How would you handle this?? amberleigh
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 77,016
Galveston, TX
You are reading it the opposite of what it means. It means that one person of the joint owners can do anything they want with the account, including canceling cards, stopping the payment of checks, etc. I am not saying that she can limit his access as long as the account is open, but canceling debits cards for any reason she chooses - you bet. Again, these are not his and her cards (even if they have their names printed on them). The cards belong to the account holders jointly and either party has the power to request a new card or cancel an existing card at any time for any reason.

Using your logic, she could not place a stop payment on a check because he wrote it.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2019046 - 06/08/15 05:38 PM Re: How would you handle this?? amberleigh
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
I am reading precisely what it says. And it says what it means.

The husband doesn't need the wife's consent to obtain a debit card, or to continue to use one.

Requests like these are precisely the reason why clauses like this exist.

Stop payments are a red herring- UCC 4-403(a) explicitly states that any person authorized to draw on an account may stop payment on an item, and any good deposit agreement will reaffirm this language.

Return to Top
#2019054 - 06/08/15 05:49 PM Re: How would you handle this?? amberleigh
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 77,016
Galveston, TX
Well, I didn't copy the whole agreement that I pulled that from. Like I said, you need to read your own agreements. Failure to act on the express wishes of one party because the bank thinks it might harm the other joint accountholder is a misnomer. The Bank holds no such reasonability what the actions of a joint account holder has on the other party. Many deposit agreements even include this clause:

" Each joint owner may close the account, enter into special agreements regarding the account, add or remove any signatory or other joint owner to or from the account and stop payment on any check or draft drawn on the account without the signature of the other joint owner(s)."

So you are saying because this does not specifically mention a debit card the joint account holder had no right to request that the card be cancelled?

You and I are of course both arguing in the blind as we have no idea what their agreements say.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2019066 - 06/08/15 06:06 PM Re: How would you handle this?? amberleigh
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
I think we would both agree that any deposit account agreement that allows one owner to remove other owners from an account is just asking for trouble...

And you're right- we don't know what the original poster's agreement says. But I do know what my agreement says.

An access device, while it can be used to affect a joint account, is actually issued to the individual. Not all accounts associated with an access device will necessarily have the same ownership. So the device must necessarily be governed independently of the account.

Failure to act on the express wishes of one party because the bank thinks it might harm the other joint accountholder is a misnomer.
Bank's fail to act on the express wishes of account holders every day. Sometimes, the correct answer to a customer's request is simply "no".

Whether we agree or disagree on the scenario at hand, I think this has been a very useful discussion.

Return to Top
#2019946 - 06/11/15 06:58 PM Re: How would you handle this?? amberleigh
SUSA Offline
Gold Star
SUSA
Joined: Nov 2011
Posts: 400
USA
I have really enjoyed reading your discussion.
Now I'm going to go read my account agreement - I've been inspired. smile
_________________________
~

Return to Top
#2024660 - 07/02/15 01:06 PM Re: How would you handle this?? amberleigh
Andy_Z Offline
10K Club
Andy_Z
Joined: Oct 2000
Posts: 27,328
On the Net
Getting into this late, but my banks agreement was in line with Randy's comments and I'd bet the agreement and perhaps the back of your card says it is the property OF THE BANK and the bank can cancel it at will.

This is a bank version of McDonalds hot coffee. We told you, we printed it on the cup, you spilled it, here is a check and we'll settle. We're sorry you were dumb and now we will pay.

The bank could cancel his card without liability. The bank could have closed the account at her request or with notice. I don't see the bank closing it instantly at the bank's will in this scenario and she had every opportunity. Similarly the bank shouldn't have liability now as jointly owned funds were taken from the account by an owner. But a jury of her peers would penalize the bank, in my experience.
_________________________
AndyZ CRCM
My opinions are not necessarily my employers.
R+R-R=R+R
Rules and Regs minus Relationships equals Resentment and Rebellion. John Maxwell

Return to Top
#2024715 - 07/02/15 02:58 PM Re: How would you handle this?? amberleigh
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
This goes beyond the original question, but to think through the implications of canceling the card:

Suppose the bank cancels the husband's card at the wife's request. Then, the husband comes in to inquire about it, the situation is explained to him, and the husband then requests a new card. Do you say no? If so, why?

(I'm sure we all agree that the prudent answer would be to close the account altogether. But for sake of discussion, let's assume the bank decides not to take that step).

Return to Top
#2024936 - 07/03/15 12:07 PM Re: How would you handle this?? amberleigh
rlcarey Offline
10K Club
rlcarey
Joined: Jul 2001
Posts: 77,016
Galveston, TX
Why assume anything when we all know that it will not happen?? Putting the bank in the middle of an on-going domestic dispute is not wise. If the card or cards were requested to be cancelled, they are done with cards. If they want a new card, go down the road. A debit card is a privilege not a right.
_________________________
The opinions expressed here should not be construed to be those of my employer: PPDocs.com

Return to Top
#2025044 - 07/03/15 03:04 PM Re: How would you handle this?? amberleigh
JacF Offline

Power Poster
Joined: Nov 2001
Posts: 6,719
PA
The question isn't academic. This type of thing happens all of the time, though the fact situations may vary. Bankers often make some strange (and incorrect) accomodations in the name of customer service.

To reword as a more generic, big-picture question:

If one owner of a joint account applies for a debit card (or any access device), does the other owner have the right to veto the request?

Return to Top
Page 1 of 2 1 2

Moderator:  John Burnett