| Bank Charges are one of the major sources of | | | | years and can amount to thousands of pounds. |
| income for banks. All banks impose charges on | | | | |
| certain failed transactions e.g. a bounced | | | | If you feel that you have been unfairly |
| cheque, exceeding overdraft limits, returned | | | | charged by your bank then you can claim |
| direct debits etc. Indeed, banks are allowed | | | | yourself or seek some professional help. When |
| to impose charges that reflect the amount of | | | | trying to get the right amount of |
| work undertaken by administrative staff in | | | | compensation it is always worth seeking |
| certain situations such as customers going | | | | guidance and allowing skilled representatives |
| into the red or handling a cheque which | | | | to handle the entire claims process. Dealing |
| cannot be cleared due to insufficient funds | | | | with bank letters and fighting for the |
| in the account. If a cheque or direct debit | | | | correct compensation takes up time and |
| has to be returned, the bank can charge for | | | | effort. Such energies are often spent on |
| the cost of this process. However, any such | | | | earning a living and looking after the |
| charge must be reasonable. Banks who | | | | family. |
| regularly impose hefty charges between | | | | |
| £25.00-35.00 on a customer who is £1.00 | | | | People will often be told that a simple |
| overdrawn cannot be said to be acting fairly. | | | | letter of complaint to a bank will get you |
| The Office of Fair Trading (OFT) declared | | | | the desired result. It is not always so |
| that these charges were unfair and | | | | straightforward. Some banks are familiar with |
| unreasonable. It is a scandal and many have | | | | standard complaint letters and will often |
| called it daylight robbery. Banks when asked | | | | reject complaints. Compliance officers are |
| to produce documents justifying the charges | | | | employed by banks to defend claims. Often, if |
| have failed to do so. However, it is likely | | | | the banks do decide to compensate, there may |
| that the banks will have gathered some | | | | a payment as a 'gesture of goodwill'. |
| ammunition to produce at the High Court in | | | | Accepting such offers is simply giving the |
| the test case on bank charges in January | | | | bank the upper hand. Customers deserve to |
| 2008. The test case relates only to current | | | | have all of their charges refunded with the |
| accounts and not business accounts. The | | | | proper interest. |
| brutal truth is that unfair bank penalty | | | | |
| charges have been imposed on millions of | | | | The Financial Ombudsman Service (FOS) which |
| people. It has been a merciless punishment on | | | | deals with rejected claims does not help on |
| people who may have simply overlooked their | | | | how to present a claim. How a case is put is |
| current account status or had a late payment | | | | very much down to the individual. The FOS |
| of wages. Excessive charging has resulted in | | | | will simply assess a claim on the arguments |
| many people getting into debt which also has | | | | it is presented with. In such cases, it is |
| drastic consequences in credit ratings. | | | | always worth getting professional help when |
| | | | fighting large financial giants for |
| The High Court will no doubt be asked to | | | | compensation. |
| consider whether the charges are fair. The | | | | |
| penalties which can be imposed, and which no | | | | Claiming against your bank will not result in |
| doubt may be in the individual contract | | | | your account being closed. Under section 14 |
| between customer and bank, relate to a range | | | | of The Banking Code, the Standards Board |
| of services following troublesome banking. | | | | advised banks "to ensure that they do not |
| However, the OFT's investigation confirmed | | | | make a disproportionate response to customers |
| that banks were imposing illegal and unfair | | | | claiming back these 'default' fees and treat |
| charges. It is widely thought that the High | | | | the customers sympathetically and |
| Court will rule in favour of the customer. | | | | positively.' |
| | | | |
| Recent research has suggested that about 41 | | | | Furthermore, any threat to close an account |
| per cent of people do not know the interest | | | | would be contrary to the Financial Services |
| rates applicable to an unauthorised | | | | Authority's (FSA) principles on treating |
| overdraft. Many more have simply swallowed | | | | customers fairly (TCF). |
| the hefty charges imposed on them without | | | | |
| even a letter of complaint or fight. It is | | | | Specialist organisations fearlessly fight on |
| also worth noting that 19 per cent of people | | | | the behalf of the consumer to claim back |
| are always overdrawn. These surveys also show | | | | excessive penalty charges. Complaint letters |
| that overdraft charges of £4.7 billion | | | | will be carefully drafted and may include |
| were paid by 43 per cent of current account | | | | legal precedents which help in the battle to |
| holders last year. | | | | get the right amount of money. The workload |
| | | | involved in tackling bank and credit card |
| Credit Card / Store Card Charges | | | | companies is substantial. Dealing with phone |
| | | | calls, rejection letters, drafting statements |
| With the increasing popularity of advantages | | | | of claim, taking rejected claims to the FOS |
| associated with credit cards and store cards, | | | | and calculating correct compensation is a |
| almost all banks and big store chains have | | | | meticulous process. Specialist compensation |
| come out with their own cards for people to | | | | firms also have useful contacts such as |
| shop, withdraw cash and purchase online. The | | | | Solicitors and Barristers who can assist and |
| British enjoy paying by plastic and the trend | | | | advise on any complex areas. |
| to purchase on credit will continue for quite | | | | |
| some time. However, there is a price to pay | | | | Such specialist firms also can help with all |
| for such short term financial cushion. Credit | | | | other types of unreasonable charges. As well |
| card companies and banks charge grossly | | | | as helping reclaim bank account charges for |
| handsome penalties when customers fail to | | | | both current and business accounts for the |
| make their minimum repayments by the due | | | | last 6 years, there can also be claims for |
| date. Many card providers charge annual fees | | | | reclaiming credit card charges, mortgage exit |
| in the subsequent years although there may | | | | fees, mortgage arrear fees, Payment |
| have been a waiver of such a fee in the | | | | Protection Insurance (PPI) and other penalty |
| previous year. High interest rates are also | | | | charges. |
| imposed when someone goes beyond the allowed | | | | |
| limit. | | | | Most compensation specialists are registered |
| | | | with the Information Commissioner which means |
| The Office of Fair Trading found that the | | | | that they abide by Date Protection rules. |
| charges imposed on credit charges were also | | | | This provides a safe secure environment for |
| unfair and unreasonable. It was a long battle | | | | your confidential information and one can |
| but the victory was an important one for the | | | | rest assured that information will not be |
| consumer. Credit card charges can be | | | | passed to third parties without consent. |
| reclaimed and it is worth remembering that | | | | |
| the High Court test case will only focus on | | | | The majority of firms handling such claims |
| bank current accounts and does not affect | | | | for compensation operate on a no win no fee |
| credit card or loan charges. | | | | basis. If successful, the firms charge a |
| | | | percentage of the compensation won and this |
| How to Claim them back | | | | will or will not include VAT. These firms |
| | | | will only charge you for their services once |
| There is no doubt that these charges result | | | | they have successfully claimed back from the |
| in many people heading into more debt and | | | | bank on your behalf. In the event that the |
| finding themselves in a helpless position. | | | | firm fails to get back anything from the bank |
| Single parents, pensioners, students and | | | | (though chances are very low) you will not be |
| hardworking people in general suffer greatly. | | | | charged a single penny. There is nothing to |
| The charges can add up very quickly over the | | | | lose and plenty to gain. |