UK banks are failing divorcees by overcomplicating the process of closing joint accounts held with former partners,
According to financial website SavvyWoman, banks often fail to clearly explain to couples opening joint accounts that both will be equally liable for expenditure in the account, regardless of who spent the money – so if the relationship ends one partner could be liable for overdrafts and other debts run up by the other.
Some banks are also slow to close or freeze accounts when couples with joint accounts split acrimoniously, the site claims.
SavvyWoman founder Sarah Pennells said:
“Of course, couples who take out a joint account have a responsibility, but so do banks, and I’d like to see all banks and building societies help couples manage their joint accounts when their relationship breaks down, by making sure both partners have to agree any extra spending or offering to freeze the account. They should also give couples consistently clear and concise information about their responsibilities for any debts on joint accounts before they sign to open the account. At the moment, some banks just cover this in their terms and conditions – which can run to many pages – while others ask couples to sign a separate letter spelling out who’s responsible for any debt on a joint loan.”
Pennells, a personal finance journalist, called on banks to introduce a facility which would require joint authorisation for expenditure in joint accounts if a relationship ends, or allow such accounts to be frozen without delay.