Ask Me Help Desk - Ontario canada banks right to offset?

I had all my accounts drained with no prior knowledge last week, I have been to the bank everyone tells me it is an overdraft account from 2007, I have never had overdraft coverage with "Royal Bank" manager said they would put the money back then retracted the next day as it was a collection company. He tried to negotiate with them and so have I. Collection company agreed to negotiate and then reneged. The debt now reports that it was an original $400 and has amassed to $860.00 in outstanding interest. I have never had credit with the bank, now am going through the Ombudsman Office, I have been without food for over a week now.. and now can't get to work. It's a railroad agreement to try and collect money. Bank did not even forward my current information to their collection company so that I could be notified.

If you never had an account with that bank then chances are at some point your ID was stolen and they used it to open the account. I would check your credit history as well with the credit bureaus. Check both to be sure. As for the bank.. this is a very difficult situation. Have them show you the signature they have on file for that account by going into the branch the account was opened in. Compare it with yours and speak with the bank manager if you need to. Explain the situation. Get them on your side.

The collection agency is a different story. By law here in canada they must 1st send you a letter before they can legally start to call you. If they have not you do not have to speak to them. Second. Do not admit that you owe this. Don't bother explaining the situation at all. They don't care. As long as you don't admit to that the debt is yours they cannot legally call you.

How long ago was the debt owed on the account? By law if the debt is 7 years or more old, then you don't have to pay it. And they cannot call you either for this.. as long as you do not admit to the debt. If you say something like "That could be mine", then they can start the harassment calls again for another 2 years.

The best way to deal with this is to speak with the bank directly and ask for paperwork. Signatures. Account history etc.

Good Luck.

Quote:

Originally Posted by Gryphyn34

By law here in canada ... How long ago was the debt owed on the account? By law if the debt is 7 years or more old, then you don't have to pay it. And they cannot call you either for this.. as long as you do not admit to the debt. If you say something like "That could be mine", then they can start the harassment calls again for another 2 years.

The best way to deal with this is to speak with the bank directly and ask for paperwork. Signatures. Account history etc.

Good Luck.

This is not correct. "That could be mine" does NOT extend the Statute. "This IS mine" could be interpreted as an admission - I find the law somewhat confusing in this aspect. The Statute uses the term "acknowledging" the debt without any further explanation.

Definitely the Statute is extended by ACTIVITY IN THE ACCOUNT - a payment, using the account (not applicable in this case).

The Ontario Statute of Limitations for debts changed on January 1, 2004 from the (previous) six years to TWO "from the last day the debt was acknowledged."

If the debt existed PRIOR to January 1, 2004 the 6 year Statute applies. If it was incurred AFTER that date, it's two years.

If I am misreading the Law and you have a citation, please post it so I am not giving out incorrect info.

It is entirely possible that overdraft fees were automatic and authorized by the papers which OP signed to open the account(s). It is also possible that there was an overdraw, for whatever reason OP never repaid the Bank, now the Bank is considering it an "overdraft fee" and moving to collect the money. OP needs to get a copy of the old checking account statements (which by law have to be available in Canada for at least 5 years) and see what/where/when/how the overdraft occurred.

I just answered another question for Ontario. Ontario did change the law in 2004 which had a direct impact on Ontario businesses. It reduced the time during which legal action can be filed to 2 years. It also defined the starting point somewhat vaguely.

What I find unclear here is what happened. If I understand you, a Collection company was able to drain your accounts.

I can understand if the bank drained your account cover an overdraft from another account in that bank. Many banks have contractual language to allow that.

But if the order to attach came from a collection agency, then they had to present a court order to do so. If there was no court order then the bank made an error and should restore your funds. If the levy was the result of a court order, then a judgement was probably obtained within the SOL.

So please clarify what actually happened here so we can help further.

Quote:

Originally Posted by Gryphyn34

The collection agency is a different story. By law here in canada they must 1st send you a letter before they can legally start to call you. If they have not you do not have to speak to them. Second. Do not admit that you owe this. Don't bother explaining the situation at all. They don't care. As long as you don't admit to that the debt is yours they cannot legally call you.

Can you cite the law on this? This is new to me that they are required to send mail first. Or that they can't call unless you acknowledge the debt.

Quote:

Originally Posted by Gryphyn34

How long ago was the debt owed on the account? By law if the debt is 7 years or more old, then you don't have to pay it.

This is definitely incorrect. Ontario passed a law changing the SOL to 2 years : http://www.torys.com/Publications/Do.../AR2004-9T.pdf

Second, I know of no where that says once the debt has gotten a certain age, that it does not have to be paid. A debt never expires. What does expire is the creditor's ability to pursue legal action to collect the debt.