Bank Charges can be legally challenged
 

BBC NEWS | Business | Banks lose overdraft charges case

It doesn't mean that all bank charges are unfair - But it does mean that each individual case can be examined - I.e. charges cannot be justified purely by saying "well it's in the small print".


Just what the banks needed :D

Looks like a good thing then. Some bank charges are no more than a cynical rip off!

Les

i got charged £30 for using my overdraft this month! which i was never told about when i told them i needed to use my overdraft as i was changing jobs!

TWATS i hate RBS/Ulsterbank worst bank ever for charging you on everything

Bank Charges: Reclaim them, they’re unlawful, includes free template letters ... is your friend :D

Though first up I'd ring them and complain. I always do this on odd occasions where I've been charged for paying of my credit card a day late or been charged an overdraft fee. Always managed to get the charge refunded, guess they don't want to loose a normally good customer.

It's all very well complaining about the charges (which to be honest, even if they are too much, you shouldn't have gone overdrawn) but the banks have to make money somewhere.

Free banking could well be a thing of the past because of this. Sow the wind, reap the whirlwind?

Geezer

The banks make plenty of money. They don't need to make these huge charges.

However, it will be a good excuse for them to earn even more money by charging us for our accounts. It would not suprise me if they deliberately lose this battle.

If i've been charged (once in a blue moon) i've always gone into the bank and demanded my money back and not once have they refused. I guess they try it on and see what response they get but if you kick up enough fuss you get it back. I'd be moving banks if my bank didn't refund the money. I guess if you make a habit of it then also it might be a bit different and rightly so.

So the banks should just be able to charge people illegally in order to maintain free banking?

If that's the case, then the system clearly doesn't work.

Let's be clear, judges all over the land have been declaring these charges illegal - Not a bit immoral, not a bit off, but actually against the law.

If you have a business, founded on the basis of beaking the law, then you cannot expect to be able to get away with if forever.


As for Banks having to introduce charging for Bank accounts - that all a big sham. All it is , is to recover the profit they are losing.


Total payout so far from these cases = £784 million
Profit in the last year for Barclays alone = £7 Billion.


They don't *need* to charge for banks accounts at all.

As if they've not got enough on their plates already :D

Yup, spot on!

bear in mind that the bank are within their rights to close your accounts, which they have been doing after people have claimed the charges back, so make sure you have no overdraft or loans with said bank first....

Sorry Pete, you are just plain wrong mate. No one has said they are illegal. The whole thing is whether the OFT deem the charges to be unfair and can enforce someting on the banks that is deemd "fair". Even the judge in this test case said the judgement did not necessarily mean the charges were unfair.

He also went on to say most of the banks' terms and conditions were plain and intelligible.

I work for one of the 'big 5' and we have recieved alot of info (as you would imagine!) about all this, and there is no doubt about the legality of what we are doing, just whether it is seen as fair (which I agree, it probably isn't)

As for banks 'making enough they can afford to give is free banking', well consider this, the bank is a profit making organisation, and they offer services which have to be paid for. You enter into a contract with them, one condition being that if you go overdrawn, they will charge you. Now I'm not advocating that a bank should apply charges that are wholly inappropriate for the crime (that said, if you don't read the contract up front........) but imagine how you would feel if you were offering a service and the person broke the agreement then said "tough mate, I dont think it's fair, naff off".

I would imagine you would think it was unfair and would start harping on about what he agreed to sign up to.

Obviously there needs to be a review of what is charged, but like I say, charging you for going overdrawn is perfectly acceptable. And, whether you think the banks' profits are large enough to swallow this or not, the fact remains that they are losing an income stream and they are entitled to try and recoup that.

Geezer

Ok, fair point - Fair or Unfair.

In any event, if the OFT rules that the cahrges in a given case are unfair, then it is still an unsound business practice.


I think the whole point is that the banks were in the worng in the first place by stipulating the terms in the initial agreement.

Of course there should be a fee to cover administration costs for going overdrawn, but that is not what the banks are (were) doing -They are profiting from people that are quite clearly in the least able position.


In other words getting people to sign up to £30 charges in the first place was wrong.




Of course they are - But tell it like it is - "It will eat into out profits". Don't make out that you can't survive unless you charge for banking, because that's patently untrue.


And lets not forget, if the OFT rules that those profits were obtained unfairly, then they shouldn't have had them in the firs tplace anyway!


It's like me stealing £50 from my company and then insisting on a pay rise to cover it when they ask for it back.

I don't really disagree with any of your sentiments, but people just need to keep a realistic view of the situation ;)

Personally, I think that the banks should be forced to review their charges, but that it is not applied retrospectively.

After all, people agreed up front and the OFT have not raised this before, it's not as if it's a 20 year battle!

Intersting times

Geezer

Thats the whole point though - The banks should not have applied those terms in the first place, thereofre the compensation is retrospective.


If you have been charging an unfair charge for the last 20 years, you don't expect the customer to say "oh well, you've been shafting me for the last 2 decades, but that's ok, as long as you promise not to do it anymore" do you?

There is a difference between what you consider to be fair, and what is legally enforceable though (as in ex post facto law).

It's a very muddy area, and strictly speaking, even if the OFT do get to enforce a level of charge, the banks are not obligated to retrospectively apply those "fair" charges.

Obviously, this has not stopped me persuing credit card charges pre 2006! ;)

Geezer

I remember one bank manager (this was a loooong time ago) telling me that private individuals were generally just a pain for banks.That wasn't where they made their money

Whats the score with this anyhow?

From what I understood this was the OFT taking the banks to court to see if these charges might be unfair? And if the court said "yes, they might be" then the OFT have to decide if they actually are and then decide what they're going to do about it?

I pay for my banking anyhow so it makes no real difference to me.