GROSS NEGLIGENCE & OR ***** FNB BOTSWANA: HOME LOAN & CURRENT ACCOUNT

Item: FNB (First National Bank) Botswana
Rating: 1
Author: brigidt B

I have been both a bond & current account holder since 2001. FNB has committed gross negligence & or ***** yet has failed to resolve these problems raised. This is despite writing to the CEOS of Botswana (they rep**** via lawyers but totally incorrect with their facts which showed no understanding of the issues raised) & S.A (ignored my letter).  I have had a home loan with FNB from 2001 & from 2010 was the contact person for this account. FNB never advised me that they were taking out life cover for their home loan account holders. This was apparently done with Regent from 1st January 2014. Apparently, the bank would pay the annual premium & then make monthly deductions from the home loan account to cover the monthly premiums.  Worse, FNB never called me or my late husband to sign the policy document. The policy benefits only app**** within certain time periods from the date of the proposal being signed. However, if someone dies whether by accident or suicide they clearly cannot sign or back date the policy document(which would be *******).Thus, I was paying for a policy that had no value & would never cover me or my late husband due to no signatures on the policies.   The only explanation received is an email from Shadrack Makoti , Manager, Credit Risk Homeloans, acknowledging that there are no signed documents as he claims that FNB calls the client & insures them immediately .Our client as the contact person never received such a call However, the bank’s actions in not deeming it necessary to get policies signed do not match the policy terms. It is of concern how many other home loan clients have policies with no value.  Also, if this insurance was important why did FNB only organize this in 2014, when I had the home loan from 2001? It seems strange that there was no prior insurance & I was prejudiced by this lack of prior insurance or negligence of FNB. I submitted my husband’s death certificate, after his suicide, in Aug 2015. Instead of stopping his share of the insurance premiums, FNB suspended/froze my account for 4 days, from 18-22 Sept 2015, so I could not access any funds. Aside from embarrassing, this caused losses due to other work commitments which entailed travel & accommodation that I could not fulfil within that time period without money.   Worse, FNB promised to credit my account with my late husband’s share of the premiums from Sept-Dec 2015.Then instead of refunding these monies in 2016, FNB deducted my bond instalment from my current account on 10 May 2016 when it was 10 days late with no warning or discussion especially when at the time home loans owed me refund monies from 2015.This again resulted in embarrassment & losses due to having a lack of funds in my account. On the 16 May, the insurance monies were refunded. Surely, FNB could have called me to discuss & waited till the 16 May 2016 (16 days late) seeing as I had to wait over 5 months for this refund.   I have also discovered that I am not covered for life insurance as the life cover was not debited in April 2016. FNB now claim that they want the instruction in writing, but why did they not call or ask me at the time for this? This is another contradiction with no information being provided. I had a car accident on 20 May 2016 & this would have prejudiced my daughter severely if I had died & not been covered.   Thus, instead of helping me, FNB’s attitude is to make my life more difficult.  The gross negligence & or ***** of FNB staff caused me, a widow with a teenage daughter, financial losses in that my remaining bond payments should have been covered by an effective ongoing signed life cover policy. The policy cover at the time of my husband’s death was P220 000 and the balance of the bond was P180 000. Deductions whether for insurance or the home loan should only have been done with my consent & or discussion. Also, my account should never have been frozen without prior warning, justification and or permission.  Their reply to the above was that insurance had been taken out in early March 2015 & a letter sent on the 30th March 2015. Aside from the fact that there was no written agreement at the time of taking the insurance and no explanation is given regarding how the letter was sent, this is completely factually incorrect. FNB via emails in Sept 2015 confirmed the fact that this insurance had been debited in 2014 & was automatically insuring from Jan 2014.  They state that the policy is valid from the date taken out but it is clear that there is no specific date as no signed policy which causes confusion. Hence their reply refers to the policy being taken out in March 2015 which is clearly incorrect. Thus, a policy holder with no signed policy has a problem proving the date it was taken out.  They refer to the policy being repudiated due to my late husband having committed suicide. However, the issues I raised were ignored. My issues were that the policy has no value as there was no signature of the policy holder which is inherent to the agreement. Also, the policy does cover for suicide but it must only be after 2 years of having been taken out. I am also claiming that FNB was negligent in not taking out or ensuring that there was insurance cover from the start of the bond period & has prevented proof of the period taken out by no signed agreement.  They claim that deductions can be made from the personal account for the bond account but do not refer to a specific clause. The only clause that may be relevant is item 7.2 of the bond agreement stating that the bank “reserves the right to set off any indebtedness against any deposit to the account of the bond holder.” However, this is very vague as it does not state that the bank can unilaterally deduct from a bond holder’s personal account as well as the bond account. This is disingenuous & frankly unfair.  I had hoped that FNB would have welcomed this as an opportunity to deal with very serious flaws in their processes & procedures which I have identified. At the moment FNB’s liabilities are minimal, in that all I require is the settlement of my bond & what I have spent since my husband’s death on the home loan totalling P181 000 due to failing to provide proper insurance & for small losses P 38 000 incurred due to the bank’s negligence. I hold that the implications of these defective procedures are far greater if not nipped in the bud & that other home owners could take more serious action if they understood & realized these defects.

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