Unfair charges - £1.21 overdraft - £148.81 charges

jamans

In sep 07 I paid off my Abbey current account and decided to stop using it (as Martin had recommended the A & L current account. I had forgotten about the interest on my overdraft which carried on to the next month, £1.21. For the next couple of months they applied an unauthorised overdraft charge but removed it manually as it was unfair obviously, then they stopped doing it and when I wanted to start using the account again they wouldn't get rid of the now enormous amount of £148.81.

the debt was then passed onto Moorcroft debt agency who I immediately rang up and told them that I would not pay and to arrange a court date as soon as possible to which they did not write to me or contact me again.

Now that the court case has finished and the banks feel as if they can do what they like without fear of being called bullies I have received a letter from Abbey (not Moorcroft) saying that the law now agrees they can do what they like and I should pay up.

Does anyone think that a judge will force me to pay £148.81 for borrowing £1.21 off the abbey from Sep 07 to Jul 08, or should I just pay up.

Please help, thanks, jamans.

oscar52

Hi Jamans,

There are better experts than me when it comes to bank charges, but at the moment, until new templates come out, I think you are between a rock and a hard place.

Dont lose faith if the PC brigade come along and say you should pay it, its all your fault, stop whinging etc etc. Most people here are here to help.

On a seperate note, if you are in the highest village in wales, you're only about 5 miles from me!!

chattychappy

jamans wrote: »

In sep 07 I paid off my Abbey current account and decided to stop using it (as Martin had recommended the A & L current account. I had forgotten about the interest on my overdraft which carried on to the next month, £1.21. For the next couple of months they applied an unauthorised overdraft charge but removed it manually as it was unfair obviously, then they stopped doing it and when I wanted to start using the account again they wouldn't get rid of the now enormous amount of £148.81.

Why did they remove the initial charge? You claim it was removed "as it was unfair obviously". Was that because you asked them too?

My view is that the overdraft was unauthorised but small. You forgot about it and charges were applied. If you then complained and they cleared the charges, you can't say you then forgot about it again. You should have paid off the rest then instead of causing the bank some administrative burden, even if over a small amount. I don't think the judge would have much sympathy. (Nothing to do with being part of the PC brigade, just my view of the way a judge might see it.)

If it's just your supposition that they removed those initial charges and that you had forgotten all the way along, then I think you have a stronger case. But it does look a bit odd - it appears you ignored the statements (or whatever) and only complain now that you want to use the account again.

My suggestion is that you just make an offer. You have caused them some costs (I'm sure a court would see it that way). I suggest you make them an offer - say £50. It shows good faith. They might take it - but whether or not they do, it would help if you have your day in court.

The reality is, it's not the just the proportionality of £148.81 against £1.21 that is relevant here. It's whether those costs are fair in terms of the costs the banks incurred chasing the £1.21. Although it's a small amount, they are entitled to chase it albeit in a reasonable way.

unhappy_with_ecar

Banks still have a responsibility under the guidelines of Treating Customers Fairly. clearly this charge is disproportionate to the debt and as such is unfair. I would write to Abbey making a formal complaint about the charge and requesting that they agree to write it off. Tell them that you feel that have not treated you fairly and that if they don't agree to write the debt off you will take the matter the financial ombudsman. Banks have to pay the ombudsman for investigations and so it will be cheaper for them to write it off than to pay the ombudsman.

Good Luck

chattychappy

If you do go to the ombudsman as suggested above, I would still make an offer first (even if only £20 - it's more the principle of the thing). By bringing this to the attention of the ombudsman it can only help your case that you've been fair and reasonable whilst the bank has been unfair and even more unfair for not accepting your offer.

The bank may indeed write it off just to save the money of an investigation. On the other hand, they have already written off two months' charges. So I think some acceptance on your part would help.

Whatever happens, don't forget to feed back the outcome!

jamans

Thanks for your comments everyone, I think i will write them a letter and offer them a small settlement figure.

hattiefats

I had a similar problem with an account I never used which went slightly over due to interest and I ended up paying them back. It ended up about £90 in the end as they waived 2 months charges. I was on maternity leave at the time and wasn't keeping an eye on my finances very well. I would be interested to know how you get on. The repayment is disproportionate to the original amount I agree but I didn't have any fight in me and just payed up. I don't think either option is wrong although I keep a much closer eye on my cash now and that account is closed!!
Good luck.

vet8

jamans wrote: »

Now that the court case has finished and the banks feel as if they can do what they like without fear of being called bullies I have received a letter from Abbey (not Moorcroft) saying that the law now agrees they can do what they like and I should pay up.

This is what worries me about the recent court decision. I think the banks will now go mad in applying ever increasing charges to everyone. They have been given a licence to print money at the customers' expense.