MSE News: CONFIRMED - OFT gives up bank charges battle

phoenixx

musical_norwich wrote: »

This is actually very good news. I am delighted!

Why should those who knew what the bank charges were, but carried on spending money that wasn't theirs, be rewarded retrospectively for their behaviour by the courts?

This country is going to the dogs due to people spending money that wasn't theirs in the first place: banks, consumers and the government. This judgement is a first sign of a return to common sense and normality.

On the one hand this site encourages being thrifty and living within your means, on the other it believes that the thriftless should be rewarded for their irresponsibility. You can't have it both ways as the courts have said!

Oh my god! More self serving ignorance of the short sighted .....not everyone who has got into financial problems is, as you so eloquently put it, 'thriftless'. Perhaps if you had a grain of empathy or social awareness you would see that some people have suffered as victims of circumstance, bad luck and yes, in some cases poor judgement but the whole point of MSE is to do with fairness and justice. Charges of £35 a pop do not represent that and yes, there are instances where the banks have cynically exploited people who don't deserve it. Attitudes like the one you represent are the reason this country is struggling. :mad:

dunstonh

I am confused at your post. You begin by saying it was a good decision, but you then concede by saying the bank charges are high. Then you continue by saying the banks have 'mostly' revised their charges to be fairer - who decided they are fairer? The banks, or an independent, impartial organisation? Or is it just your opinion that they're fairer?

I think it was a good decision as people should not be rewarded for running their accounts badly.

I do think the charges nowadays are higher than they should be. Its different to 10-15 years ago when a quarter of the branch staff were involved in dealing with bounced items and bad accounts. Nowadays, its far less than that but the charges are still high. However, that doesnt make the charges unlawful. Lots of businesses and professions have high charges on things.

You dont have to be polarised to have views on this. I think they should charge but really it ought to be lower. However, I dont think the courts should be the place where that is decided.

The current charging methods were designed to be more compliant. Not my opinion. That was the reason the banks altered the way they charged.

I have to disagree about your point about banks having to penalise those that go over your overdraft by imposing high charges, which is what you're suggesting. A sensible approach by the banks would be simply to close the account that has an overdraft facility for those that are obviously abusing their accounts instead of pushing them into further, unaffordable debt, but that isn't likely as it doesn't generate revenue for them.

Someone abusing the account will be in debt. The account cannot be closed whilst its in debt. A badly run account like that would be closed if it returned to credit. However, there is a difference between someone taking the mickey and running the account badly on purpose and someone that is just incompetent with their spending.

phoenixx

chris1huk wrote: »

Kim, you talk absolute tosh, so much so it is really beginning to irritate me.
When you finish judging people with your snobbery attitude, try considering how things REALLY work.
Maybe if you were ever(and im guessing you havent been judging by your attitude) in this sort of situation you would have a different attitude. The sleepless nights worrying about how you are going to pay for things, the stress, the headaches, the depression. You know you're getting a bank charge of £63 for going less than a pound overdrawn, yet theres nothing you can do about it, that £63 takes away 25% of your wages, leaving you very little to pay bills with.
£63 on a £1 overdraft.. does that seem fair? does that seem like a rational charge?
on a yearly % rate thats like 2.3million % interest (APR or AER or whatever) on a £1 1 day overdraft.

Pay for your own banking, dont expect others to pay it for you, and for the record, i am on no benefits whatsoever, so whoever said they pay for charges through taxes and benefits can forget that arguement.

Also to add, I'm no legal expert/finance expert, so im talking from just a general standpoint of someone who is in this sort of situation, my facts or reasoning maybe wrong.. just saying things how i see them

With you all the way Chris, I am also sick of the 'Kim talks a load of random nonsense' posts. I'm not on benefits, I work full time and have a second job to pay off debts for which I accept I am responsible. My employer pays me on the 26th (and has done for the past 16 years); the bank applied a charge of £35 for going over my overdraft limit by applying another charge on the 25th of the month. This charge was applied for going 18pence over my overdraft limit because a direct debit had gone up without my knowledge. I was also charged £28 for honouring the direct debit.....so that's £98 for 18 pence over the limit....fair and proportionate - I don't think so. I suffer from depression, I am supporting children and a partner with a medical condition. I have explained this to the bank who I have been with for 22 years but they are completely unmoveable (it's the Halifax) and just use the 'computer says no' argument. People with attitudes like Kim make me utterly disgusted.

wok_boy

If my memory serves me correctly remember the days when Natwest used to charge £9 per day/£30 per month for going overdrawn. Then the £35 fees for DDs not going through. So yes the charges can soon rack up.

As I said in my previous post and agree with the others, those who look down upon those who are in financial difficulties are not living in the real world. This is an internet forum so you are within your rights to express your opinions, however if it is going to rile up a lot of people then keep them to yourselves. I have a lot to say about the world we live in, however I choose the right time to express those opinions. If the time isn't right I don't air them.

bargepole

My wife went a couple of quid over her overdraft limit a few times, and HSBC whacked on charges of £150 per month for the privilege.

We used Martin's letter templates to demand refunds of those charges over a 6 year period, amounting to some £850, and then issued a court claim against them - this resulted in an out-of-court settlement of £675, which she received about a week before all claims were put on hold.

It's disappointing that the Supreme Court have applied perverse logic to overturn the original High Court ruling, but I guess that was always on the cards given our incompetent Government's involvement with the irresponsible banks.

rosemarie.nugent

I have been banking for over 40 years and strongly feel that your campaign is a little short sighted. This country is in this mess as consumer credit has gone mad; If you arrange an overdraft, then fine, its arrange, but if you go overdrawn without consent you should pay heavily for it - that way it will stop you over-spending in future. - and assist those of us that have been thrifty to keep the banking costs low.

Sorry if this is not PC!

MikeyH

musical_norwich wrote: »

On the one hand this site encourages being thrifty and living within your means, on the other it believes that the thriftless should be rewarded for their irresponsibility. You can't have it both ways as the courts have said!

Of course the courts said absolutely no such thing. The courts didn't comment at all on whether the charges were fair or not, ruling instead that the OFT may not even subject them to a test of fairness.

I get very irritated by views like these, often offered by those enjoying free banking on the backs of theose who struggle with thier money.

Asking that people only pay fair charges, rather than extortionate penalties bringing billions in extra profits for the banks, can harldy be described as rewarding irresponsibility.

discoass

noh wrote: »

Quit the personal messages.
I do know what the charging structures are.
I still find it hard to believe you racked up £4200 of charges in a 3 month period.

Even if that was the figure did you not receive any letters or any statements?
Did you not draw any money from an ATM and notice you were overdrawn?
Did you not ever check your account online?

If you cant take responsibility for your own finances nobody else will.

we went through a similar situation to the OP it went absolutely crazy after a cheque was bounced 3 times (natwest error),we did get it all back but only after long telephone calls and later on letters .
i can simpathise wholeheartedly as in the end money was going into the account (wages) and going straight out again in OD charges.
in the end we had to stop money going in and open an another account with a different bank, this gave us a bit of breathing space ,then they had the cheek to offer us a loan at 35% to pay off their OD charges which we declined. It all got sorted in the end but the speed that this happened was incredible, and it wasnt even our fault.
we didnt recieve any letters other than the initial one about the cheque.

BOB_A_H

You say "pay heavily for it" What constitutes pay heavily?
£35 or £40 ok for you, or would you make it even heavier? £3,000 perhaps for going say 20p o/d. Come down from that fluffy cloud you are living on please and join the real world.

discoass

noh wrote: »

I understand the effect you are describing.
What I dont understand is how you let it continue after it first coming to your attention.
I also dont undersand why you didnt notice that you had gone £50 overdrawn in the first place and correct the situation at that point.


The level of charges applicable to the account were available to you.
I dont believe they need justification. They were what they were.

If I buy something I dont ask for a justification of the price. I make a decision on whether I'm prepared to pay that price and if not I don't buy.

You are right it has never happened to me probably because I do take responsibility for my own finances.

Whether you find it offensive or not it was within your power to prevent the charges reaching the level they did.

Take off those rose tinted glasses. If u run a very tight budget its very easy to go overdrawn,the banks system is set up in such a way that even the most prudent budgeters can get caught out and in my experience its mainly to do with the lack of speed money is transfered between banks and customers wether its a cheque or the bacs system