"On July 3, I spoke with [a man] (name redacted) in agency payments at L&G. He said was unaware of the change of banking details. We e-mailed across a copy of our latest statement. We also sent full details on letterhead by both e-mail and post. We heard nothing.
"I spoke with L&G again on July 30, and nothing had been done to alter their records.
"As a sole trader my business account and personal accounts are one and the same. I have had an e-mail from the team payments manager saying he is not going to pay me until I produce a business bank account."
Under UK law, sole traders are allowed to use personal bank accounts.
According to the business banking sites for large UK banks Lloyds Bank and Barclays, while sole traders are not legally required to set up a business account, some bank accounts might not allow business transactions.
However, Pruggmayer said his personal account is able to accept business transactions and no other provider has had an issue with this.
The banks also suggest having separate accounts is a useful way to keep business and personal finances separate, and can provide support to help a business thrive.
FT Adviser approached L&G for comment.
Within the hour after FT Adviser contacted L&G for a response, Pruggmayer rang to say he had received an email from L&G, apologising for the error.
The communication said: "My sincere apologies, it wasn’t obvious from the business name, that you were in fact a 'sole trader', and I can now see this on the FCA website.
"There was also further confusion to the fact there was prior business bank details on file, as I understand you are winding the business down.
"As we can verify the sole trader status, I’m happy to instruct my payments team to update the details as per your request.
"I can confirm that to date no payments have been withheld and the second your policy goes live/transfers to our system it will be allocated to your agency."
Pruggmayer said: "I am glad they came back to me so quickly after I raised a complaint, but I should not have to have raised a complaint to get this sorted.
"If this were a complaint against my firm, the regulator quite rightly would be investigating my processes."
