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‘Lloyds Bank wrongly declared me dead and shut down my accounts’

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A Lloyds Banking Group Plc company logo above an ATM in Chelmsford
A Lloyds Banking Group Plc company logo above an ATM in Chelmsford

A Lloyds customer was locked out of his bank account for a week after the bank wrongly declared him dead in a case of mistaken identity.

John Hill, from Devon, first noticed something was wrong when his cards stopped working and he started to receive letters from his utilities providers stating his direct debits had been cancelled, meaning his water, energy and heating would soon be switched off.

However, a major error at Lloyds' head office was to blame. A member of staff at Britain’s biggest bank had marked Mr Hill as deceased following a clerical error, having received an alert about someone else with a similar name.

The bank had received an alert on the nationwide “death notification register” used by most large financial institutions. The system is used when someone dies to alert firms their accounts need to be closed and any credit returned or debts settled.

The message came from Fraser and Fraser, an “heir hunting” genealogy firm that attempts to track down the beneficiaries of lost inheritances, usually passing on money from people who have died without leaving a will.

But the death notification Fraser and Fraser had sent related to a completely different 55-year-old John Arthur Hill from Kent, who had died in 2020.

Neil Fraser, of the firm, said: “Lloyds completely ignored the fact that Mr Hill had a completely different middle name, address and date of birth from their customer, who we certainly did not report as deceased. There must be hundreds of people with that name, but clearly someone did not make the proper checks.”

Lloyds has apologised and offered the customer £500 in compensation, according to consumer website Moneysavingexpert, which first reported the story. It said the customer’s direct debits had been reinstated and that Mr Hill would not be left out of pocket due to any penalties he had incurred for failing to make payments.

Lloyds said it was “extremely sorry to Mr Hill for the distress and inconvenience this has caused him”.

A spokesman added: “While we can say this is an isolated incident, we want to make sure this never happens again, and we’ve worked hard behind the scenes to understand what went wrong.

“In the meantime, we have done all we can to reassure Mr Hill he will not be left out of pocket as a result of our mistake, and offered a payment in recognition of the distress this experience has caused.”