Mr. Rao had a credit card 4384-5914-0280-3924 on which there was an outstanding of Rs 36798/- This was in Feb 2005. Due to unforeseen circumstances, Mr. Rao had to settle the card (by entering into a negotiated settlement with the bank). The settlement reached was for 16,000 and Mr. Rao was issued a letter dated 15th October 2005 for the settlement asking him to make a payment by the 15th of October. He promptly issued a cheque against the settlement letter. HSBC promised to send him a zeroised statement, which they never did.

As a standard term, banks insert a clause that the settlement has to be honored by a particular date else the whole amount becomes due. HSBC cheated Mr. Rao into parting with 16,000 as settlement amount and then imposed this clause as they had received the money on the 19th October in their account after presenting the cheque a few days late. This is a deliberate tactic of many banks to defraud hapless and ignorant customers.

Then HSBC went silent for 5 years. In 2010 they approached Mr. Rao again and demanded some more money on the same account. By this time, Mr. Rao had misplaced the settlement letter and receipt of the transaction done in 2005. He once again paid another 10,000 on 29th March 2010 and was later able to locate the original settlement letter.

Like other banks, HSBC reported Mr. Rao as a defaulter with CIBIL. His CIBIL report shows that he now owes HSBC 1,43,847.

Mr. Rao is applying for a housing loan but his loan applications are getting rejected due to his record having been tarnished in CIBIL.

Thus banks like HSBC are using CIBIL to target customers into paying up for wrong reporting done by them on the customers account.

CIBIL is the systems way of creating a harassment tool for easy recovery even when the customer is not at fault.

Mr. Rao has been writing to various people including HSBC but to no avail.

The association will now have to escalate the matter to Banking Ombudsman.

Of late we have been getting calls from people who fell on bad times when recession hit the UAE. They were forced to leave the country in a haste because the laws there would have led to their arrest and incarceration.

People came back to India after abandoning their houses, cars and all worldly possessions. They are now being harassed here in India by people who claim to be recovery agents of these banks. They are threatening them with Interpol cases and arrest warrants issued by Interpol.

An Indian in India is subject to jurisdiction of Indian Courts.

These recovery agents are asking people to deposit money in Indian Bank accounts which belong to third parties.

We request everyone to file a police complaint against any person who approaches you for recovery of money not owed in India as remittance of money is governed by stringent RBI regulations. And you are not supposed to pay Dick when you borrowed money from Tom without Dick showing you adequate written proof (valid in India) of the mandate received from Tom.

Make a note of the number from where you are getting the calls and the name of the person calling and file a complaint of criminal intimidation and extortion against the concerned number and persons.

In 2002 I entered into a settlement with Standard Chartered Bank on four credit cards that I had. The total outstanding as on 18-01-2002 was of 1,36,272/-. I was offered a settlement of 96,000 payable in 6 installments of 16,000 each starting on 20-1-2002 and ending 20-6-2002. I agreed for the settlement and paid the bank six cheques.

All the cheques got cleared in due time on presentation.

As far as I was concerned the transaction was over and the account settled.

Now in June 2011, Nine Years after closing the account, Standard Chartered Bank has come back asking for more money from me. They say that I owe them money and that I have been reported a defaulter with CIBIL. They say if I want my name removed from the CIBIL list (a pack of lies) I have to pay another 1,75,000!

This incident points to how banks routinely enter into settlement and when the transaction is complete simply ignore to inform CIBIL about the status of the account. The credit record of the individual is tarnished for ever and it also leaves a handle on the individual for further squeezing in case the individual wants to get his name removed from CIBIL.

I am planning to sue Standard Chartered Bank for damages to the extent of 1 Million US Dollar to be paid to the Prime Ministers Relief fund for deficiency of service and tarnishing the image of an individual even after entering into a settlement. And for causing mental agony to an individual by wrongly reporting his credit history.

In the mean time, I have accessed various financial institutions for small and big loans and have paid back every paise that I owed. Luckily in my case I do not need to access any institution for any more loan.

But thinking about those who have to and a shudder runs down my spine. I dread the Shylocks in the form of banks who have come to inhabit the banking space.

Therefore Standard Chartered Bank, I would prefer if you were better be gone!

What do you do when you are a former ICICI employee who had the misfortune of owning a credit card issued by your own bank and you have defaulted for some small amount on the credit card?

Well, you can talk to your bank or come to us. Ms. Geraldine D’Silva, having ICICI credit card number 4477-XXXX-XXXX-8000 was an employee of ICICI Venture. In 2005 she had a delayed payment. The bank merrily posted hefty charges to her account. She disputed the charges and just could not keep pace with the more than 100% the bank was charging to her account. Her outstanding at that time was around 30,000. As she was an ICICI employee, she had an ICICI salary account. One fine day, the bank took out all the money she had in that account against her dues on the credit card. When she met us in 2005, we spoke with the bank to treat her case on sympathetic grounds. Since that day, she never received any bills for her credit card or any collection calls on that account. She wrongly assumed that the matter had died a natural death.

But, as you know, ICICI will never forget any money that you owe to it. In 2011, after 5 years the collection circus has started again. This time the person who identifies himself as Mr. Rokade and calling from Mumbai Telephone number 32208694 says he is from the CBI, later on he changes his credentials and says that he is from Police and yet again he says he is an advocate. He has been threatening the member with dire consequences like arrest at the airport while she is leaving the country to getting her arrested in Mumbai. The member has gone to the Bandra Police station and filed a complaint.

Now when API Patil called the offending number, he was given another number, 9594326074 which apparently was Mr. CBI/Police/Advocate Rokade’s number. But guess what this phone was answered by one Mr. Himanshu who works for ICICI.

As usual the police inspector did not bother to book the offending collection agent for criminal intimidation and trespass and told our member and the collection agent to go to court. While he is right about the dispute going to court, he could have easily arrested the collection agent for extortion, criminal intimidation, assault and battery and trespass on the privacy of the member. He could have also arrested the collection agent for masquerading as a government employee and threatening a member of the society.

Important lessons

1. Never take a credit card from the bank where you have an account. The bank will sooner or later clean up your account for any default on your credit card.
2. Don’t assume that the police will help you in your fight against the behemoths like ICICI.
3. When you close an account, ensure you have paperwork that says that the account is closed.

We are now escalating this complaint to the office of the Banking Ombudsman.

In February 2010 our member Mr. P.V. Paralkar received an unsolicited policy from ICICI Prudential with direct debit to his credit card for the premium.

As my Paralkar is a retired defence officer, he is 68 years old, he had no requirement of this policy. He promptly wrote back to ICICI Prudential and returned the policy.

But to his horror, the bank simply debited his account and converted the debit into an EMI scheme without his consent.

As this was an unsolicited policy and the debit was for no services rendered our member refused to pay. And as usual, the debit has not attained large proportion and collection calls from the bank have started.

It is a shame that a bank the size of ICICI has to stoop to such practices to meet the sales targets for selling insurance to its own customer by cheating them out of their money and peace of mind.

We are now escalating the complaint to the Office of the Banking Ombudsman for redressal.

The Times of India carried a report on new RBI Guidelines for Loan Recovery Agents.

The salient points are

1. They have to undergo a mandatory training period of 100 Hours in etiquette.
2. They can not call you between 7 p.m. to 7 a.m.
3. They can not talk with anyone else about your loan, including your family members.
4. On the phone they can call you a maximum ’1′ number of times.
5. They can not visit your house or make a demand for repayment if there is a function in progress in your house.

Do read the whole article here

Yesterday one of our members faced collection agents from ICICI Bank. The collection agent named Sachin Shinde arrived at the door of our member. When our member told him that he did not have any money for payment, the agent just refused to budge. He said he will stand there the whole day or till the time his seniors advised him to move away.

This is the standard practice adopted by collection agents appointed by banks who swear by the Model Code of Conduct for Agents in the collection process.

For quite some time such harassment had abated after we took action against erring banks, but then like we wrote earlier, you just cant teach an old dog new tricks. The collection agents are back to their bag of old tricks. Abusive calls, asking people to sell themselves, to start prostituting their wives and daughters, discussing the default with people other than the borrower who are in no way connected to the borrowing and the works.

It seems the banks have no faith in the Indian Judicial System.

We had no option but to drag the collection agent to the local police station. His immediate controller in ICICI Bank, Jagdish Shetty went into a meeting and refused to take the calls of his own men. Later we came to know that he was trying to get in touch with Mira Road Police Station and get things straightened out.

Anyway, when we lodged a complaint, the on duty Assistant Sub-Inspector, Mr. S.S. Kane, told the recovery agent to follow due procedure and not to harass the customer. He advised Mr. Shinde to use due procedure. He also asked our member to pay-up to which our member cited temporary financial difficulties and assured the officer that he had every intention to pay, just that for the time being he was not in a position to pay.

We advised the agents to seek suitable remedy / relief from a court of law as at best the act of lending and borrowing money is a civil offense for which courts can be readily approached.

But banks routinely avoid doing this. The well oiled system of collections provides for huge commissions at the cost of the customer, who will kill the golden goose that lays golden eggs?

But that was not the end of the story. Mr. Shinde promptly went back to the house of the member with a new story that we had taken away his identity card (a patent lie) and then he started subjecting the members wife to abuses. He was now joined by another person, who he claimed was his team leader and who claimed his name was Navneet. When we asked him to show us some identity, he refused to do so and was abusive to the worst. He said in so many words, ‘Remember, your wife is alone at home, we will make life miserable for her’, ‘I will not go until I am paid’, ‘I don’t care about the Police, do what ever you want’, ‘I know Gilbert Mendonsa (the local NCP leader)’ etc.

We had no option but to go back to the police station. The kind officer asked us to call both the agents to the police station and we called them over. They just refused to come. They said that they do not have money for auto-rickshaw and would walk. We waited for almost two hours for them to arrive (even walking to the police station would not have taken more than 20 minutes) and finally had to leave because it seems they had no intention of showing up.

The agents were from ‘Vaishnavi Agency’ operating out of RPG Tower at J.B. Nagar, Andheri (East).

It is our observation that all calls originating out of RPG Tower are of abusive nature.

We will be filing a criminal complaint against ICICI Bank requesting the police department to put all telephone calls originating from the above office of ICICI Bank under surveillance.