Last week an order was sent by fax, email and via the postal service to Westpac, with instructions to debit $36K from a North Sydney communication and video Company, the Company has no overdraft and operates out of cash flow.
The same day that the order was made the ATO withdrew their instructions to Westpac and ordered the bank to return any money to the Companies accounts.
A letter detailing the ATO’s instructions to return the money was sent to Westpac on October 2nd by fax, email and via the postal service.
Despite the order being withdrawn, the bank on the 5th of October withdrew $24K from the Companies accounts.
Then on the 8th of October the bank withdrew a further $12K from the Companies accounts despite calls from the tax office to Westpac’s Collections Department in Concord NSW the prior day.
On the 7th of October the ATO called Westpac’s Collections Department to inquire why the original $24,000 had not been returned to the Company.
They were told that the money would be refunded to the ATO by bank cheque a process that takes several days as opposed to making an immediate Electronic Funds Transfer.
The CEO of the Company who does not want to be named said “When the ATO realised that a mistake had been made they immediately issued a withdrawal notice to Westpac. The ATO advised both my accountant and myself directly that the order had been lifted on the 2nd of October. The ATO send correspondence to Westpac by three methods fax, email and letter. We got a copy of the letter sent to Westpac earlier this week so I don’t accept that three communication methods failed”.
“Then there is the issue of a bank that claims that they are operating in a so called digital age with apps and electronic transfers telling the ATO that to return the money they have to issue a bank cheque”.
“What I believe they are doing is withdrawing the money and then investing it to their own benefit”.
“This is a bank that bows down to the ATO but has no regard to their business customers who are being forced to use phone banking to make inquiries when things go wrong”.
“Their phone banking operators and at the local North Sydney branch were clueless as to how to address the issue. Here we were raped of funds and some online wally working from a script is suddenly faced with questions re an ATO order and missing funds and they do not have a clue how to handle the problem”.
“We spent nearly two hours trying to get answers” the CEO said.
In recent months Westpac has moved to restructure their branch network so that customers have to use phone banking at a branch as opposed to talking to bank employee.
This is the same bank who during the long weekend locked hundreds of thousands out of their St George, Melbourne Bank and Bank SA accounts.
A spokesperson for the ATO said “We sent three notifications to Westpac notifying them to withdraw the order. We also spoke to them directly, this should not have happened”.
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