MSE News: CONFIRMED - OFT gives up bank charges battle

pool-hustler

i've just sent the following to Nat West... worth a try:

Dear Sir or Madam,

I refer to default charges applied to my account amounting to £927, which I have requested you pay back.

I wrote to you on previously, making the original request for a refund in settlement of my claim. As I have not received a satisfactory response, I am writing to inform you I intend to claim the full amount.

I feel that since you altered your charge for a Direct Debit rejection to £5, this reflects that your charges were indeed excessive and unfair.

This claim is based on the Unfair Terms in Consumer Contracts Regulations, as I believe these default charges are unfair and not proportionate to your costs, which you have recently changed and therefore the court will rule in my favour.

I have attached a full schedule of the charges with this document.
I am prepared to pay £5 for each charge made instead of £38, which I feel is fair?

I look forward for a full response to this letter within seven days; otherwise I will commence court proceedings to reclaim my money.

natweststaffmember

I have commented already but a challenge with regards to the level of the charges is ruled out by the OFT judgement, however a challenge with regards to the fairness of them has not been.

Premier_2

davidgmmafan wrote: »

The direct debit system itself is riddled with problems, not least of which is the so called direct debit guarantee. Some banks will process an indemnity and still not budge on the charges. I don't understand that at all. In any even the DD guarantee should include consequential loss. If one DD is taken early or in error which cases others to fail the company should cover the charges, or the bank should cancel them either way.

If you have an immediate refund then the transaction which caused the trouble did not occur, therefore I can't see how the charges can stand.

....

To be fair, the Direct Debit Scheme is an extremely robust procedure if people knew all the rules.
Unfortunately many people don't understand the scheme ... and I include many bank staff in that category.

The DD scheme does include a consequential loss clause within it's terms.
Whilst banks must make an immediate refund of disputed items under the terms of the DD Guarantee (and the word of the payer should be final as to whether any transaction is disputed), the consequential loss part of any claim is not refundable immediately (where the cause claim is not the responsibility of the bank), but only after the bank has received the claimed funds from the Originator.
It is the bank's role, under the terms of the DD scheme, to make the consequential loss claim if the payer requests one to be made.

This is fair in my opinion as why should a third party (the bank) have to fund any losses which it itself was not responsible for in the first place?

natweststaffmember

And to give Premier his dues(we both understand the context), the consequential losses bit is something that I had no idea about prior to it coming up on the threads here. Not sure if you yourself brought it up or not, Premier. It is very important to remember that part of the DD Guarantee Scheme that is not exactly wide public knowledge.
I have yet to see a successful consequential loss via this method posted on the forum(please post a link if you have Premier, cos I am interested how it is dealt with....for future reference).

Chrysalis

natweststaffmember wrote: »

I have commented already but a challenge with regards to the level of the charges is ruled out by the OFT judgement, however a challenge with regards to the fairness of them has not been.

lets hope they dont given they balls'ed up so much on their prior case, they best to either force the issue with legislation or let people make their own claims.

natweststaffmember

Chrysalis wrote: »

lets hope they dont given they balls'ed up so much on their prior case, they best to either force the issue with legislation or let people make their own claims.

I assume you mean the OFT. Personal challenges are still valid on the fairness of charges under Regulation 5(1) on UTCCR and it will become clearer in the next 6 weeks how the banks are defending newer arguments incl. CCA s.140 as well.
The OFT gave up their collective challenge

Premier_2

natweststaffmember wrote: »

... the consequential losses bit is something that I had no idea about prior to it coming up on the threads here. Not sure if you yourself brought it up or not, Premier. ...

Probably

Here's a couple of previous threads where I've mentioned it.
This one has the text of the appropriate rule
http://forums.moneysavingexpert.com/showthread.html?t=2123615

and this one has a link to an example of the old claim form used by banks
http://forums.moneysavingexpert.com/showthread.html?t=2132529
(but as I said, it's presumably all automated nowadays)

Edit: oh the file has gone
Give me a few mins whilst I find another.

Edit 2 : try this one
http://sharesend.com/j6ea3

natweststaffmember

http://forums.moneysavingexpert.com/showpost.html?p=27711683&postcount=23
Can you edit the link a bit more and I'll take out my link from this one?

Yes I do remember this and you had me intrigued enough to do a bit more researching. Pity the OP has yet to update the thread on how they got on, though

Chrysalis

natweststaffmember wrote: »

I assume you mean the OFT. Personal challenges are still valid on the fairness of charges under Regulation 5(1) on UTCCR and it will become clearer in the next 6 weeks how the banks are defending newer arguments incl. CCA s.140 as well.
The OFT gave up their collective challenge

I do mean the OFT yes. I am saying I hope they dont persue another court case at all. As they severely played into the banks hands.

natweststaffmember

Chrysalis wrote: »

I do mean the OFT yes. I am saying I hope they dont persue another court case at all. As they severely played into the banks hands.

Explain how?