NETeller locked my account

[Pommaac]

About three weeks ago Neteller suddenly locked my account with no reason given. I contacted them by phone expecting the usual simple questions to verify my account. This was apparently not enough this time and she asked me to confirm transactions made to and from my account. I could only confirm one recent transaction since that's the only transaction I've made since I got home from a 2 month long trip. I told her I could confirm transactions from before the trip but she was only interested in recent transaction, and one was apparently not enough. I also explained I'd been travelling for two months so that isn't the problem either.

Now I seem to have reached a dead end. The support says they've sent my case to Investigations department and the only way to contact them is through email. It's just that investigations does not reply to any of my emails! I've sent them four emails, the first one for more than 2 weeks ago. Each time I call Neteller they tell me they can do nothing else but send investigations a message to let them know this matter is urgent, which hasn't helped at all so far. They can't give me the reason for locking my account just tell me not to worry, my money is safe.

Well, it's good that my money are safe but WTF? How can they lock an account and not give any reason for it or come up with any conclusion for more than 3 weeks?

Have anyone had the same experience? What do you suggest I should do?

 

[vinylweatherman]

About three weeks ago Neteller suddenly locked my account with no reason given. I contacted them by phone expecting the usual simple questions to verify my account. This was apparently not enough this time and she asked me to confirm transactions made to and from my account. I could only confirm one recent transaction since that's the only transaction I've made since I got home from a 2 month long trip. I told her I could confirm transactions from before the trip but she was only interested in recent transaction, and one was apparently not enough. I also explained I'd been travelling for two months so that isn't the problem either.

Now I seem to have reached a dead end. The support says they've sent my case to Investigations department and the only way to contact them is through email. It's just that investigations does not reply to any of my emails! I've sent them four emails, the first one for more than 2 weeks ago. Each time I call Neteller they tell me they can do nothing else but send investigations a message to let them know this matter is urgent, which hasn't helped at all so far. They can't give me the reason for locking my account just tell me not to worry, my money is safe.

Well, it's good that my money are safe but WTF? How can they lock an account and not give any reason for it or come up with any conclusion for more than 3 weeks?

Have anyone had the same experience? What do you suggest I should do?

Tell them that you are going to seek legal advice if the deadlock continues. Your money is certainly NOT safe if it has been seized with no way of you getting it back. Make sure this is in writing, rather than just a phonecall. Give them a formal timeframe in which you expect a reply. They have already had 3 weeks, so a further 14 days should be reasonable.

How far you go depends on how much money you have in the account.

They can investigate all they like, close your account even, but one thing they CANNOT do is simply seize your money without a formal legal authority, such as a court order for seizure.

They are based in the Isle of Man, and regulated by the UK's FSA, but are also answerable to the Manx authorities.

The next step would be to make a FORMAL complaint. This starts the ball rolling for a formal complaint to follow to the FSA and Manx authorities if Neteller fails to deal with your complaint within regulatory guidelines and standards for response, which include standards on how long they are allowed to "stall" before making a substantive reply.

 

[Pommaac]

Thank you for your advice.

I spoke to support one more time yesterday and refused to be treated in the same way as before. Finally she promised me that she would get an agent from the investigations department to call me backk right away. I was not very surprised when this did not happen though.

I've now sent them a formal email containing what you suggested to both investigations and their complaints officer. Let's see if this leads to anything.

 

[mattsgame]

Sorry a little off topic

I just logged into neteller,

They are requesting that I accept a new FSCS Policy

FSA Exception warning

NETELLER's policies are changing to allow your funds to be safe-guarded in accordance with FSA regulation. For compliance reasons, we require you to accept the FSCS policy.

I accept the FSCS policy

How are they safe-guarded when this is in the policy?

Financial Services Compensation Scheme Policy

This document was last updated on 01/07/2009

1. Electronic Money Service

NETELLER (UK) Limited offers an e-money service and not a banking or escrow service. NETELLER (UK) Limited is not acting as a trustee for balances that you choose to keep in your Account but is only acting as an issuer of electronic money. You are not required to maintain a balance in order to use the service. A balance will be created whenever you use the service to make a payment funded from your bank or card. If you do have a balance in your Account you will not receive interest or any other earnings on this balance because NETELLER (UK) Limited is prohibited by regulation from paying interest on an e-money balance.

2. Financial Services Compensation Scheme

As an applicant for the Extended Account limit you are alerted to the following conditions that legally apply to your NETELLER account:

1. The Financial Services Compensation Scheme (FSCS) does not apply to funds stored in your NETELLER account;

2. If NETELLER (UK) Limited becomes insolvent the funds stored on your NETELLER account may become valueless and unusable; and

3. Consequently, if NETELLER (UK) Limited becomes insolvent you may lose the funds stored on your account.

If you do not wish to be able to have an Account with a balance of over 1,000 GBP (or account currency equivalent) you may still open an 'Express' Account. An 'Express' Account will have limits imposed on certain types of transactions (for a full explanation please see the NETELLER Account Limit Policy).

This is making me feel a little un -easy about using neteller now!

Should I be worried? I don't remember excepting this when I first signed up?

Cheers
Matt


EDIT: now I'm Really confused, or am I confusing myself,

Email:
Dear ******,

As of 30 November 2010, your contract with NETELLER Operations Limited will be with NETELLER (UK) Limited.

How this affects you

Because NETELLER (UK) Limited is regulated by the Financial Services Authority of the United Kingdom (FSA), your funds will be safe-guarded in accordance with FSA regulation
You will now have access to the UK Financial Ombudsman Service should you have any complaints that are not sufficiently dealt with through NETELLER's formal complaint procedure.
Please note that the next time you sign into your account you will be prompted to accept the new Financial Services Compensation Scheme (FSCS) Policy.

Should you have any questions, please contact us.

The NETELLER Payment Network

 

[vinylweatherman]

I just logged into neteller,

They are requesting that I accept a new FSCS Policy

FSA Exception warning

NETELLER's policies are changing to allow your funds to be safe-guarded in accordance with FSA regulation. For compliance reasons, we require you to accept the FSCS policy.

I accept the FSCS policy

How are they safe-guarded when this is in the policy?

Financial Services Compensation Scheme Policy

This document was last updated on 01/07/2009

1. Electronic Money Service

NETELLER (UK) Limited offers an e-money service and not a banking or escrow service. NETELLER (UK) Limited is not acting as a trustee for balances that you choose to keep in your Account but is only acting as an issuer of electronic money. You are not required to maintain a balance in order to use the service. A balance will be created whenever you use the service to make a payment funded from your bank or card. If you do have a balance in your Account you will not receive interest or any other earnings on this balance because NETELLER (UK) Limited is prohibited by regulation from paying interest on an e-money balance.

2. Financial Services Compensation Scheme

As an applicant for the Extended Account limit you are alerted to the following conditions that legally apply to your NETELLER account:

1. The Financial Services Compensation Scheme (FSCS) does not apply to funds stored in your NETELLER account;

2. If NETELLER (UK) Limited becomes insolvent the funds stored on your NETELLER account may become valueless and unusable; and

3. Consequently, if NETELLER (UK) Limited becomes insolvent you may lose the funds stored on your account.

If you do not wish to be able to have an Account with a balance of over 1,000 GBP (or account currency equivalent) you may still open an 'Express' Account. An 'Express' Account will have limits imposed on certain types of transactions (for a full explanation please see the NETELLER Account Limit Policy).

This is making me feel a little un -easy about using neteller now!

Should I be worried? I don't remember excepting this when I first signed up?

Cheers
Matt


EDIT: now I'm Really confused, or am I confusing myself,

Email:
Dear ******,

As of 30 November 2010, your contract with NETELLER Operations Limited will be with NETELLER (UK) Limited.

How this affects you

Because NETELLER (UK) Limited is regulated by the Financial Services Authority of the United Kingdom (FSA), your funds will be safe-guarded in accordance with FSA regulation
You will now have access to the UK Financial Ombudsman Service should you have any complaints that are not sufficiently dealt with through NETELLER's formal complaint procedure.
Please note that the next time you sign into your account you will be prompted to accept the new Financial Services Compensation Scheme (FSCS) Policy.

Should you have any questions, please contact us.

The NETELLER Payment Network

Actually, this is nothing new. Neteller, however, have made the situation CLEARER. The problem is that they use the statement "regulated by the FSA", and customers have taken this to mean that balances are covered by the compensation scheme.

Neteller balances are NOT "real money", but similar to those "gift cards" that you can buy to spend in certain shops. These gift cards are ONLY worth the money paid for them whilst the shop involved is trading.

After the credit crisis, many retailers went bust, and many customers found they were left with worthless gift cards that could no longer be used.

It's a similar thing with Neteller. Money in the account is like money in a gift card scheme, it is ONLY as safe as Neteller itself.

Neteller is a service for MOVING money, not STORING it. After a big win, and a balance likely to cover deposits, even if lost, for weeks ahead, the surplus should be withdrawn back to a bank, where it will be safer (up to £50,000).

This applies to ALL eWallets.

The £1000 figure is because this small amount IS covered by the FSA, because £1000 is considered a reasonable upper limit for what is in effect a glorified gift card. Those who do NOT use Neteller for gambling probably never have the need for an extended account.

The scope of the FSA beyond this £1000 is to resolve complaints, and ensure that Neteller obeys the rules.