Bank Charges

[justme]

Check it out guys and gals, Tom is taking the banks on head on!

"Court Battle In The News"

just so you lot know, i got awarded a few hundred pounds today after 2 letters to my bank, the first stating i was intending to take them to court if no offer was made, then, after a standard reply from the bank saying 'no' i sent a second saying i would disregard the last letter and give them 28 days to make an offer before i handed the matter over to my solicitor.

i can prove £1,200 of charges, and they offered me £750 to settle, which, when you think the charge was fair, just the monitary amount was excessive, means i am better off now than if i had given money to a solicitor or went with a 'no win no fee' £200 + 20% deal...

what do you lot think? shall i accept it or wait and see what happens with tom?

Poll closes on Friday@12 midday!

[justme]

don't accept. In my experience you should never accept the first offer. But you should accept the second. That will be they're final offer.

[Denzel]

Fair play to you Denzel

Thanks Pete. You're a great guy.

[threegee]

The UK's biggest banks have lost a test case about overdraft charges.

A judge has decided that the Office of Fair Trading (OFT) can rule on the fairness of the charges, which many customers have been trying to reclaim.

BBC Article

[maggie]

The UK's biggest banks have lost a test case about overdraft charges.

A judge has decided that the Office of Fair Trading (OFT) can rule on the fairness of the charges, which many customers have been trying to reclaim.

BBC Article

i reclaimed my charges last year, and helped two people reclaim theirs. i'm now planning on reclaiming my sons. the banks knew the charges were unfair or they wouldn,t have refunded the money without even defending the cases in court when so many people were reclaiming.

[Denzel]

i reclaimed my charges last year, and helped two people reclaim theirs. i'm now planning on reclaiming my sons. the banks knew the charges were unfair or they wouldn,t have refunded the money without even defending the cases in court when so many people were reclaiming.

I like you Maggie. You live to give.

[threegee]

And, once again the Banks lose in Court. If they don't appeal to the House of Lords we'll have a final decision from the regulator by year-end.

Of course a lot of people will say that compared with their other problems it's just a drop in the ocean to them now. As a good part of them are already in de-facto nationalisation it could well be the taxpayer who has to fork out.

[Mr Darn]

I see an end to free bank accounts coming then!

Banks used people who could not manage their finances well (myself included) as a money spinner, making them thousands if not millions of pounds per week. once this income stops or is reduced, they will look to other ways to make money from us.

Advanced accounts are nothing new, with most banks charging upwards of £5 per month for their benifits, but there was always a free basic option.

alas, i think this will be soon no more

[threegee]

Major decision due today. Banks have challenged the right of the OFT to decide on these matters.

Is it one law for the banks and another law for everyone else? We await with interest (doubtless a very high rate of interest if we are borrowing, and pathetically low rate if we are depositing ).

[mercuryg]

I see an end to free bank accounts coming then!

What free bank accounts? The whole point of this prolonged argument has been that, in fact, no bank account is free and, as it is, charges levied are extortionate. Does it cost £30 to send a letter? They didn't pay me that when I billed them for one.

personally, I would rather have an account with a fee and a lesser rate of charges for going 50p overdrawn than one that charges me a bloody fortune for the privelege.

Here's hopign the OFT screws them

[Mr Darn]

If you stay within your limits, and plan well, bank accounts are free at the moment.

Its your mistakes that makes them cost you.

I believe a choice should be made:

either a free account with bigger penalties or

a charged account where its not as extortionate if you do get things wrong.

Personally, i'm doing well now with my banking, since i changed to a new system, so i'd be opting for the free account with higher charges.

Dunno why i never thought of it before its cost me a fortune over the years!

[mercuryg]

Its your mistakes that makes them cost you.

That's not always the case, Mr Darn; clearly you're not self employed.

I don't mind paying charges for being over my limits, but resent paying £30 quid plus for a few pennies. Banks have been ripping people off for far too long and look what happened to them - they fell like dominoes because of their inherent greed.

[Monsta®]

but without banks we'd all be down cambois hijacking boats like in somalia! as we would be mostly wearing rags and starving cause the country was broke! so before you gripe about a few quid, take in the wealth the banks bring to even the poorist of us! there still !*!@# scrooges though!

[Blank]

Mr Darn, it isn't always our fault when we are charged by banks. A while back I ended my contract with an insurer – paid off what I owed, cancelled the Direct Debit and left it at that, thinking it was all sorted.

A while later I got a letter from the bank stating that I'd been charged £80 because the insurance company had tried to take a stupid amount of money out of my account – twice.

In the end I got an apology from the Insurers, but the bank was adamant that I paid the £80. I didn't though – I went to the branch and told them that I refused to pay it. After about 20 minutes of arguing and feeling like I was getting nowhere, I just requested to close my bank account. Funnily enough, the clerk went scurrying off and came back with a manager of some sort, who politely said that he would be quite happy to write off the £80 for me.

I would have had to pay the bank £80 for the mistake of someone else – it was out of my control.

Today's ruling at the Supreme Court doesn't really bother me that much – it didn't come as a surprise. Bet it doesn't do anything for people's feelings towards the banks at the moment though.

[mercuryg]

but without banks we'd all be down cambois hijacking boats like in somalia! as we would be mostly wearing rags and starving cause the country was broke! so before you gripe about a few quid, take in the wealth the banks bring to even the poorist of us! there still !*!@# scrooges though!

I hate to tell you this, but banks don't give you money. You have to give it to them, they invest it, lose a fortune, and then tell you its all gone.

[Monsta®]

I hate to tell you this, but banks don't give you money. You have to give it to them, they invest it, lose a fortune, and then tell you its all gone.

thats funny but i get this wierd thing called interest, granted its not much but its alot more than the mattress pays!

and to point something out i never said they give you money only that with out them the country would not function as in somalia were inflation is 1000% or something daft and the supermarket selves are empty! you cant really blame them for turning to piracy in there current climate, I would too if i was one of them.

[Mr Darn]

@Blank

If you can prove you cancelled the direct debit, you would always get it back. Banks just hope you roll over and accept it. Good on you for perseverance!

@Monsta

I regularly get interest payments now. Granted its only a few pence, but its better in my pocket than theres!

[mercuryg]

thats funny but i get this wierd thing called interest, granted its not much but its alot more than the mattress pays!

yeah, you get interesat at what - half a percent or something? You know what the banks keep?

and to point something out i never said they give you money only that with out them the country would not function as in somalia were inflation is 1000% or something daft and the supermarket selves are empty! you cant really blame them for turning to piracy in there current climate, I would too if i was one of them.

I don't think Somalian pirates are turning to piracy because of the dire economic status of their country, but because they see rich pickings in the busy seaways off their coast. To be a pirate, after all, you need a boat, arms, and so on, and the tools of piracy are not available to the average Somalian who is starving and destitute.

For the record, it might not have occured to you but the reason this country - the UK - is bankrupt (and it is)is down almost entirely to the banks.

[Andy Millne]

yeah, you get interesat at what - half a percent or something? You know what the banks keep?

The average non introductory rate of interest on current accounts is wait for it... 0.1%

[Monsta®]

The average non introductory rate of interest on current accounts is wait for it... 0.1%

still its 0.1% more than under the mattress!

[Cympil]

I just received this email about the Supreme Court Judgment for anyone who`s interested...

Dear ***

Supreme Court Judgment and what is means,

Well I have just got back from London where I spent a lot of time trying to put

right the media stories that the Bank's had won and this was the end for

consumers, gladly I note that most of the Media have now reported that this case

was not as important as many people thought is was:

I am going to set out parts of the Judgment and explain what they mean if

needed. After which I will outline what I think should happen next.

The Judgment

Firstly the Lord Walker highlighted the fact that many members of the public

were not aware of the limited nature of the issue, which the court had to decide

in the appeal.

At Para 45 Lord Walker Said "…The Directive and the 1999 Regulations apply only

to terms which have not been individually negotiated". Clearly the contract we

all entered into with the banks has not been individually negotiated so the

regulations do apply.

Lord Philips Para 57. Stated the issue is whether the relevant charges

constitute "the price or Remuneration, as against the services supplied in

exchange†within the meaning of the Regulation. If they do not, the attack on

the fairness of the term that is open to the OFT will not be circumscribed

(restricted) by Regulation 6(2)b. If they do, then they will still be open to

attack by the OFT on the ground that they are "Unfair†as defined by regulation

5(1) but that attack cannot be founded on an allegation that the Relevant

Charges are excessive by comparison with the services which they Purchase, for

that is forbidden by regulation 6(2)b

So what does this mean, well it means that the Court has ruled that the charges

for bounced direct debits and unauthorised overdrafts etc are part of the price

for the services, therefore they cannot be tested for fairness under Regulation

6(2)b of The Unfair Terms in Consumer Contract Regulations 1999, However the

Court has said that the OFT can assess the Fairness of the price under

Regulation 5.1. According to other criteria. (See Para 59)

This point is further explained in Para 80. Lord Philips states 'it seems to me

that this reasoning is relevant not to the question of whether the Relevant

Charges form Part of the price or remuneration for the package of the services

provided but to whether the method of pricing is fair. (My emphasis added) It

may be open to question whether it is fair to subsidise some customers by levies

on others who experience contingencies that they did not for see when entering

into their contracts. If not it may then be open to question whether the

Relevant Terms fall within Regulation 5(1)….†Clearly his lordship highlighted

that the court may be persuaded that it is unfair for some consumer to pay for

services that other consumers benefit from for free.

What's more it is mostly the consumers who are on low incomes and struggling

financially that are paying for everyone else. This is in my opinion not fair,

and shows the banks have not acted in "Good faithâ€. Or as Lord Mance's suggested

in the trial, that 'the banks were engaged in a sort of Robin Hood in reverse'

(see Para 2) I would suggest he means the banks were taking from the poor to

subsidise the rich.

All the Lords appear to have agreed with Lord Walkers final Paragraph that being

52, in which he said '…This decision is not the end of the matter', as Lord

Philips explains in his judgment. Moreover Ministers and Parliament may wish to

consider this matter further. They decided in an era of so-called "light-touchâ€

regulation, to transpose the directive as it stood rather that to confer the

higher degree of consumer protection afforded by the national laws of some other

member states. Parliament may wish to consider whether to revisit that

decision.'

So what does all this mean, well it means the following

1. The OFT can still look at the charges under UTCCR 1999, and always has been

able to. They could now launch a new test case. (However, what must be asked is

why was there a two year test case on a very narrow point of law? when the OFT

already had the ability to assess the fairness of theses charges under

Regulation 5.1 and others )

2. All consumers who have submitted a claim using the Old Particulars of Claim,

arguing that the price was unfair and or that these are a penalty charges. Needs

to amend their claim to include an argument under regulation 5.1. (a new

Particulars of claim will be live on the site tomorrow with full instructions on

what you need to do)

3. We also need to put pressure on the Government to amend the Regulation so we

all have the same consumer protection rights that other member states have. (So

get writing to your MP's a template letter for this will be on the site within

48 hours)

4. I am sorry to say but I would like to see the stay remain in place, for a

least a month. This will give consumers time to amend their claims and other

consumer groups and I will be discussing the possibility of joining forces to

bring a joint Class action. I feel this would insure that we could make sure

that all the legal arguments are covered in full. I will update you all on this

when I have spoken to the other consumer forums.

Finally, I will explain Regulation 5(1) in more detail on the site for those

that are interested. However, what was important in this news letter is to

confirm that this was basically a set back to the OFT and not to consumers.

Claims can still be filed.

The FSA has also lifted the Wavier.

I hope that the OFT if they do decided to bring a new action, that they will now

invite the consumer groups to the table. Something we asked them to do before

this test case, sadly that request was refused.

To conclude, the test case has only resulted in us having to amend the

Particulars Of Claim and resulted in a two year delay, other than that we are

back to the position we were in two years ago.

So was this test case a victory for the Banks, yes they beat the OFT on a small

point of law, they did not beat the consumer forums and or the consumers.

Warm regards

Stephen Hone