October 1st, 2012 by Questions
day after declaring bankruptcy, Royal bank withdrew funds from my account. Something about first right. Is it not in section 69, that once declared, this cannot happen? Bank is not being helpful with answer.
Posted from: Ontario
One Response to “Laura”
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October 01, 2012 at 6:07 pm, A licensed trustee said:
What the bank did is called “the right of set-off”. If you owe them money for one account (or loan or credit card) and you have money in another account, the bank has ther right to seize the funds to reduce the debt. They “set one account off against the other”. This is not considered a violation of Section 69 – the staying provisions of the Act.
Most trustees, ourselves included, tell their clients to switch banks BEFORE they file to avoid this very problem. You may want to have a chat with your trustee if they didn’t warn you about this…