MSE News: PM wants swift bank charges compensation

Former_MSE_Wendy · 22 September 2009 at 7:16PM

This is the discussion thread for the following MSE News Story:

"The Prime Minister has called on current account providers and the regulator to urgently "negotiate" to prevent payout delays if bank charges are ruled unfair.

Gordon Brown spoke out on overdraft penalty charges for the first time in a letter sent yesterday (reprinted in full below) to MoneySavingExpert.com..."

Read the full story:
PM wants swift bank charges compensation

Roger49 · 23 September 2009 at 7:41AM

Repayment of charges should be made as soon as possible. What a spur for the economy for Christmas. Much better than a little VAT cut to boost the economy.

Orchid62 · 23 September 2009 at 8:35AM

Does anyone know if this will be the case for Business Accounts as well?

anne1996 · 23 September 2009 at 9:07AM

Lets hope it will get sorted once and for all. I am not Gordon's biggest fan but with him now on board lets hope with all three parties involved, some presure will be put on and like said by Roger49 What a spur for the economy for Christmas. Much better than a little VAT cut to boost the economy.
What a victory it would be to get the payouts moving.

Matt_Watkinson · 23 September 2009 at 9:33AM

Let's hope they're as good as their (desperate for votes) words. Abbey still refuses to pay me anything despite my losing my £100 a week job with Mind. I'm now totally jobless, have spent all my credit card money on bills, am £2k overdrawn and have written to Antonio Osorio, Abbey's Chief Exec to ask him how I'm supposed to be a good Dad to my kids and a good husband to my wife, while he sponsors Lewis Hamilton with squillions. He hasn't replied.
We all of us claiming need this money which the greedy banks have mucked around with, lent, got interest on and are now feigning poverty. It's ours and the proposed settlement looks brilliant news. But already I understand the banks are trying for the European Court of Human Rights to make us wait forever. How we wish we had the money to squander on such a luxury. Pay up, you tight gits!

esmerellda · 23 September 2009 at 9:35AM

Thank you Martin. I agree that the consumer campaign groups should be able to put forward their views should the government/OFT and the banks decide to negotiate.

I am discussing the matter with LegalBeagles,(as we have been doing over the past two years) I agree the groups should be working together and we shall respond to begin discussions on the overall consensus of what we should, if anything, be negotiating for. There are a few points you have made which we don't agree with.

Regarding your comment

A figure of £2.50 was calculated after an intense study by a professor of banking. Therefore, people should get back what they were charged minus £2.50 each time, plus statutory interest of 8% a year (the figure the court imposes).

Do you have a copy of this report ?

whodoitaketocourt · 23 September 2009 at 9:41AM

Orchid62 wrote: »

Does anyone know if this will be the case for Business Accounts as well?

The current test case is specifically only for current accounts.

The OFT has, however said in it's Q&As published on 19th June 09 re. it's current work on this : see http://www.oft.gov.uk/shared_oft/personal-current-accounts/banksqa190609.pdf

12. Will the test case have any implications for other financial contracts such as for credit cards and business bank accounts?

The OFT's primary concern is whether the unarranged overdraft charging terms in banks' personal current account contracts comply with the UTCCRs. The judgments are important milestones in the process of establishing that. Of course, the extent to which the judgments (including on penalties) provide legal precedent for cases on other matters is something for consideration in relation to the particular circumstances of those cases.

So, it looks like it would only take a large company (who can afford it) to start a legal challenge relating specifically to business accounts based on the precident set in this case and win. Then a legal precedent will have been set for business accounts too and other companies would be able to legally use this to reclaim their own unfair bank charges.

There will always be the argument, of course, that business account users will have had more knowledge of contracts etc. and so would have known what they were signing up against, but let's face it - how many businesses can operate without a business bank account ? And there are no business accounts I know of that do not charge this level of fees, so it could be argued that banks were involved in unfair price-fixing practices in the setting of what have been found to be unfair bank charges.

So fingers crossed !

vicmcr140208 · 23 September 2009 at 9:41AM

If you have already claimed and are waiting to see if you will get a pay out, does anyone know if the case comes back that we will get a pay out, will the banks calculate what you're owed up to and including the current date?

schnide · 23 September 2009 at 10:23AM

"so we have called on the banks to.."

Oh great. Is this in the same way they so successfully called on the banks (which we subsidised) to start lending again?

Typical that Clegg supports it, Cameron then jumps on the bandwagon and then Brown's PR team finally decide that it'd look good for him to join in as well.

HTML200 · 23 September 2009 at 10:32AM

I hope the banks are made to give the money back automatically. I've worked out how much I could get back from them, but I don't feel it would be wise for me to try, given that my bank recently agreed an IA, which they could rip up at any moment.

I just have this feeling they'd suddenly need bigger repayments from me if I submitted a claim.

Wouldn't it be nice if a little bit of all that money used to prop up the economy actually reached the people it needs to?

Wispa1 · 23 September 2009 at 11:11AM

Thank goodness there is movement on this - I am starting to see a small ray of light at the end of a long tunnel!!!!. Lets hope the banks pay out soon. I also hope the banks let us have access to the refunds once they have been paid and not to dictate where the funds go to. In other words for those of us who have priority debts, we should be allowed to use those funds to pay of those debts first and not any overdrafts etc that we may have with that existing bank/s.:money:

MSE News: PM wants swift bank charges compensation

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