By 
Virgin Money has blocked tens of thousands of credit card accounts, leaving customers unable to spend at a time of major financial pressure.
The bank has two million active credit cards and about 32,000 accounts are understood to have been blocked due to concerns about customers’ activity – with a charity marathon runner used in Virgin’s own marketing materials among those affected.
Industry analysts suggested the Financial Conduct Authority watchdog (FCA) would take a dim view of accounts being blocked as households reel from the pressure of the coronavirus pandemic. The regulator has repeatedly called for firms to treat customers fairly during the crisis.
Virgin wrote to affected customers saying it has reviewed their financial position and has decided to stop any further spending on the card. Customers will be required to pay off any outstanding debts on the same terms as before.
Colin Burgin-Plews, 51, received an email this week stating that his credit card had been blocked. Mr Burgin-Plews works as a chef in South Shields and said he has an outstanding balance of £800.
He said: “I always pay well over the minimum payment each month.
“I have never missed a payment but they’re making me feel that I’ve done something wrong.”
Mr Burgin-Plews criticised Virgin for blocking cards when many customers are relying on credit to weather the coronavirus crisis. He said: “I’m furloughed and my wife is on lockdown because of her medical problems.
“This credit card was supposed to be a cushion in case anything went wrong.”
He said he had snapped his credit card in half after trying to call the bank but being held in a queue for more than half an hour.
The account closure decision was particularly galling for Mr Burgin-Plews. Under his alter ego, the Man in the Big Pink Dress, he is a charity fundraiser and a picture of him crossing the finish line at the London Marathon has been used in promotional material by Virgin Money, which sponsors the race.
Andrew Hagger, of personal finance group MoneyComms, said: “I’m sure the regulator will be taking a close look at this situation as it flies in the face of everything the Financial Conduct Authority is trying to do to help consumers during this Covid-19 crisis.
“It’s bad enough being furloughed on a reduced income or losing your job and all the worry and stress that comes with it, without your card company pulling the rug from under your feet.”
A spokesman for Virgin Money said: “As a responsible lender we do need to review accounts regularly, in line with other card providers. If there are any changes to a customer’s account we will write to them to let them know in advance.”
Virgin Money declined to confirm how many accounts were affected or the reasons why.
Customers who are unhappy can ask for their account to be re-opened, with decisions made on a case-by-case basis.
A Financial Conduct Authority spokesman said: “We will be discussing this with Virgin to understand how they are supporting the customers concerned.”
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