Cape Town - A Nedbank client claims he is owed at least R600 000 after the bank told him it would no longer deduct insurance payments on his account but continued to do so.
Kariem Kagee, who owns two petrol stations in Cape Town, said a bank employee contacted him in 2010 to say insurance payments on the cash handling of his accounts would no longer be deducted. He needed to get external insurance.
Kagee claims the insurance was not cancelled and he ended up paying dual insurance until now.
The bank failed to follow up on his instruction to cancel the insurance as he had already obtained external insurance.
Nedbank denied any wrongdoing, saying Kagee should have cancelled his insurance contract with the bank.
Kagee blames the bank for telling him telephonically the insurance would be cancelled but then not following through.
“Cash handling is an expensive component of our business because we deal in cash daily. We pay an insurance fee for every R100 we deposit,” said Kagee.
“When I found out in 2011 they were still charging me insurance I went to the bank with my broker. Nedbank said they would refund me 50 percent. This was admitting they were wrong.
“I approached my attorney who wrote the bank a letter of demand. I had a meeting at the bank. They said I could not write a letter of demand because they were lending me money. They said they could take it away.
“It was like holding a gun to my head. They gave me an overdraft facility and they told me they would withdraw it. They forced me to back off.”
Nedbank responded to Weekend Argus queries, saying the bank was “aware of the case and have been trying to reach agreement on the matter for a number of years”.
“In April 2010, Nedbank contacted Mr Kagee and proposed the new product terms. The options required either a new contract containing the new terms be signed or the termination of the agreement.
“However, Mr Kagee refused the options and insisted that the insurance component remain exactly as per the contract he had signed… which meant his insurance cover remained as before.”
Nedbank said Kagee’s “cash deposit fees were therefore not reduced as no new agreement had been signed”.
Nedbank said Kagee’s external insurance was also insufficient and “would have placed himself at significant risk of losses from theft”.
“The cover provided under the Nedbank agreement ensured he was protected from such threats,” said the bank.
Kagee is adamant his external insurance was sufficient, as advised by the broker, and said he wanted a refund from Nedbank for the insurance it has charged him
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Weekend Argus