MSE News: Bank charges result next week

Widelats

natweststaffmember wrote: »

The Supreme Court is giving its decision and that means it has made a decision rather than referring the issue to the European Court of Justice. My understanding is that this is the end of the Preliminary Issues ie whether the regulations apply to bank charges terms. Their executors still have the right to pursue the claims of those who have passed on since this process began in July 2007. I suspect some banks will post a profit next year prior to the full conclusion of the OFT test case issues and that we will have a new government in place as well.

So a decision - a final proper decision - is on the cards for next week? Lets hope so, its been far too long ...

natweststaffmember

Widelats wrote: »

So a decision - a final proper decision - is on the cards for next week? Lets hope so, its been far too long ...

Remember the wording I have used: "preliminary issues" because if the regulations apply then we move onto the "substantive issues" which is about fairness of the charges, and if they aren't what is a fair charge, refunds, limitations etc,etc,

Widelats

natweststaffmember wrote: »

Remember the wording I have used: "preliminary issues" because if the regulations apply then we move onto the "substantive issues" which is about fairness of the charges, and if they aren't what is a fair charge, refunds, limitations etc,etc,

A bit complicated for my untrained finance brain - but i look forward to the decisions

natweststaffmember

I will explain: The first part of the case is about whether the wording of bank charges can be assessed under the Unfair Terms in Consumer Contract Regulations 1999. That means that this decision is deciding if they do apply.
That will lead to the following if the Banks' appeal fails. The OFT declare the terms unfair and ask for voluntary compliance. If that fails, then they can apply for an injunction to stop the banks charging for "unauthorised overdraft charges" and then it is up to the banks to prove that their charges are fair. If not, then it will deal with redress(refunds), limitations(how far back) and restitutionary damages(compensationary).
As you can tell, this will not happen overnight and may take more legal action all the way to the Supreme Court again but we would be a lot nearer than before.

Orford

We are half way through a long dark tunnel. Wednesday's decision will tell us whether it's a light we can see at the far end or whether it's a train coming the other way. Simples.

Already_a_ghost

natweststaffmember wrote: »

Already_a_ghost wrote: »

Does anyone know what will happen in my situation - HSBC have recognised that I am in financial hardship, but offered me a miserly ammount of my charges back. The Financial Ombundsman service sent me a letter about three weeks ago saying that they would be writing to HSBC to ask for more information about my case.

I thought that I would be paid out in full soon? Will the ruling next Wednesday affect the likelyhood of this happening?

Any light cast on this would be appreciated.

Under financial hardship the bank does not have to payout 100% of the charges under financial hardship. I have argued that you should negotiate based on arrears, based on when the financial hardship started, which may not necessarily be when the charges started, and the effect of how your income lowered and budget tightened directly because of the charges.

Next Wednesday does not have an effect on claims apart from if the banks' succeed in their appeal.

The bank doesn't have to pay me anything at all? According to Martin's guide no bank has ever contested a bank hardship case. To quote the guide:

"Now for the good news, assuming the claim is accepted as one of financial hardship and can be heard now…

According to the Ombudsman, NO bank has contested a bank charge case. Banks simply offer a 'good will' payment without investigation.

This bizarrely means, despite its role as arbitrator, it has yet to rule on the legality of charges in a bank charges hardship case, or any bank charges case, for that matter. So providing you can prove you’re in hardship, and the charges affected the situation, the chances are good.."

So now that the FOS is investigating my case as a hardship claim I should be getting an offer of a "good will" payment from HSBC in the next few weeks right??

natweststaffmember

Already_a_ghost wrote: »

The bank doesn't have to pay me anything at all? According to Martin's guide no bank has ever contested a bank hardship case. To quote the guide:

"Now for the good news, assuming the claim is accepted as one of financial hardship and can be heard now…

According to the Ombudsman, NO bank has contested a bank charge case. Banks simply offer a 'good will' payment without investigation.
You are going to have to ask Martin and site team about the above because I have already had a dialogue and have already stated that I think the use of that wording is misleading. I deal with financial hardship most of the time unless it is discussion of articles or what is happening in the bank charges campaign.
What MSE has said is TECHNICALLY correct, ie yes the claim can be dealt with now BUT they do not HAVE to repay even 1p under financial hardship. They could waive charges and interest for 3 months and that is compliance.
Furthermore, "NO bank has contested a bank charge case." Well they wouldn't contest the case they would give the FOS their reasoning for rejection, interim payout, suspension of charges and then the FOS would look at your argument and decide based on that. Again it is TECHNICALLY correct, but is misleading IMHO in that many have gone to the FOS/Ombudsman because of that line and have found them deciding that the bank is right in what they have said.
This bizarrely means, despite its role as arbitrator, it has yet to rule on the legality of charges in a bank charges hardship case, or any bank charges case, for that matter. So providing you can prove you’re in hardship, and the charges affected the situation, the chances are good.."

So now that the FOS is investigating my case as a hardship claim I should be getting an offer of a "good will" payment from HSBC in the next few weeks right??

No the fact that they are investigating the case does not mean that they have made a decision on your case. What that means is that if you have gone there and said "they say I am in financial hardship but not paying out" that isn't good enough for them to force HSBC to payout. Question is, what reason did you argue that HSBC are wrong in their decision?

Orford

Already_a_ghost wrote: »

The bank doesn't have to pay me anything at all?
No, nowhere in the the FSA waiver does it oblige banks to make any payment at all:
http://www.fsa.gov.uk/pages/Doing/Regulated/Notify/Waiver/pdf/dir_monthly_0790.pdf
According to Martin's guide no bank has ever contested a bank hardship case. To quote the guide:

"Now for the good news, assuming the claim is accepted as one of financial hardship and can be heard now…

According to the Ombudsman, NO bank has contested a bank charge case. Banks simply offer a 'good will' payment without investigation.

This bizarrely means, despite its role as arbitrator, it has yet to rule on the legality of charges in a bank charges hardship case, or any bank charges case, for that matter. So providing you can prove you’re in hardship, and the charges affected the situation, the chances are good.."

Just as you shouldn't believe everything you read in the papers, the Gospel according to Martin isn't infalliable

So now that the FOS is investigating my case as a hardship claim I should be getting an offer of a "good will" payment from HSBC in the next few weeks right??

Quite possibly, or they could agree with HSBC

Already_a_ghost

Orford wrote: »

Already_a_ghost wrote: »

The bank doesn't have to pay me anything at all?
No, nowhere in the the FSA waiver does it oblige banks to make any payment at all:

According to Martin's guide no bank has ever contested a bank hardship case. To quote the guide:

"Now for the good news, assuming the claim is accepted as one of financial hardship and can be heard now…

According to the Ombudsman, NO bank has contested a bank charge case. Banks simply offer a 'good will' payment without investigation.

This bizarrely means, despite its role as arbitrator, it has yet to rule on the legality of charges in a bank charges hardship case, or any bank charges case, for that matter. So providing you can prove you’re in hardship, and the charges affected the situation, the chances are good.."

Just as you shouldn't believe everything you read in the papers, the Gospel according to Martin isn't infalliable

So now that the FOS is investigating my case as a hardship claim I should be getting an offer of a "good will" payment from HSBC in the next few weeks right??

Quite possibly, or they could agree with HSBC

I'm getting confused. If the banks don't have to pay out anything to people in financial hardship, why on earth have they done so in the past??

And how long do you reckon it will be before HSBC make me a "good will" payment offer? Weeks? Months? Years?

Thanks for the replies so far!

natweststaffmember

Already_a_ghost wrote: »

I'm getting confused. If the banks don't have to pay out anything to people in financial hardship, why on earth have they done so in the past??
No test case, genuine financial hardship, bank error or exceptional circumstances.
And how long do you reckon it will be before HSBC make me a "good will" payment offer? Weeks? Months? Years?
Could be as long as a piece of string.
Thanks for the replies so far!

let's go one step back, do you have priority debt arrears(mortgage or rent, council tax, utilities)?