Confusion with NatWest Unfair Charges Claim

JROxford1978

Dear All,

This is my first post here and follows me gaining great info from this site. My query relates to me attempting to reclaim £3,604.28 from NatWest for unfair charges over the last 6 years. (Actually, I should have done this years ago as I have probably paid 3x that figure though only recently 'got my head out of the sand).

My current financial circumstances are much better then in years gone by - multiple credit cards, ultimately acquired defaults on 4, plus a spiral of recurring charges on my NatWest bank account. Nowadays I am unfortunately unemployed, though no longer have credit card debt (repayed all in full).

Hence, I recently wrote to NatWest asking to reclaim the sum I mention above - as in that period of time I was in a depressing period with problems mentioned above. They have sent me a 'financial hardship form' to complete, though am a bit confused about completing it as:

1. I live with my wife in a house she previously purchased. Hence, am I classed on the NW form as a 'Homeowner' and either way, what cost can I allocate to this? Perhaps half the mortgage and class it as my contribution?
2. Is it rellay essential for me to complete this form at all? My partners salary could actually just make us both scrape by, though really I just want to be treated fairly bby NatWest and they reimburse me for the extraordinary fees they have previously charged me - surely this should mean by current financil situation should have no bearing?

Apologies if this has already being covered elsewhere, though I have searched this website and cannot find reference to my particular dilema.

Any help is greatly appreciated. For reference I paste below a copy of my recent letter to NatWest, so you may see what I said.

Kind regards,

JROxford.


Natwest
Retail Regulatory Risk
2nd Floor
Cornerstone
60 South Gyle Crescent
Edinburgh
EH12 9WF

7th September, 2010

Dear Sir or Madam,

Account number: ********
Sort Code: ******

I am writing to request that you repay all the charges in relation to direct debits, unauthorised overdrafts and standing orders that have been applied to my account in the past six years.

By issuing me with these charges I feel that you have broken the FSA’s regulatory principle to ‘pay due regard to the interests of its customers and treat them fairly’.

I believe the fact that I have been incurring bank charges goes contrary to the aims of the Lending Code (Section 9) and Banking Conduct of Business Sourcebook (section 5.1.4 ‘in particular, a firm should deal fairly with a banking customer whom it has reason to believe is in financial difficulty’), and previously were contrary to the Banking Code. My personal situation has been affected by the charges leaving me in financial hardship in the following ways:

• I struggled to pay for necessities - food, utility bills etc.

· I was unable to pay debts – incurring further charges from lack of credit card repayments
· I experienced frequent periods of my payments being regularly returned – due to not having enough money in my Natwest account
· I have had a substantial drop in income - due to being made redundant 3 times in the last 6 years and currently unemployed
· My financial hardship has forced me to live off credit and even at times regularly withdraw money using credit
· I have frequently been over overdraft limit - resulting in me paying well over £500 per year in charges to yourselves
· Your charges are disproportionate
· I was stuck in a cycle of charges I could not break free from – was unableto clear them before new daily or monthly fees were added on top
· Ultimately, these Bank charges have hurt my situation. The charges have contributed to making my financial hardship situation materially worse, causing immense depression

The charges are unfair under s.140A(1) of the Consumer Credit Act 1974 and contrary to the requirement of good faith, having caused a significant imbalance in our relationship and a detriment to myself, and under regulation 5(1) of the Unfair Terms in Consumer Contracts Regulations 1999, in the following respects (save for, in the case of the later, those matters which relate to the level of the charge as against the service supplied in exchange):

(1) The charges were (or had the potential to be) excessive and punitive in comparison with the costs to the bank caused by my conduct which triggered the charges.

(2) The charges were set by reference to the overall cost to the bank of providing current accounts to all of its customers which held such an account, rather than merely to the cost of my conduct thereby effectively requiring me to subsidise the provision of current accounts by the bank to other customers.

(3) In the premises the bank did not deal fairly as between myself and its other customers.

(4) The existence and quantum of the charges were inadequately and/or insufficiently explained and/or drawn to my attention either; when my account was first opened; when I gave an instruction which would result in the levying of a charge; or otherwise before any particular charge was applied.

(5) The circumstances and manner in which the charges were levied created potential for the application of multiple charges and the levying of charges to give rise to the application of further charges.

(6) The complexity of the charges and/or the circumstances in which they were levied.

(7) The nature of the charges and/or the circumstances of their application was such as to cause me inherent difficulties in predicting the incidence and amount of such charges in advance.

(8) The absence of any effective competition between providers of current accounts which restricted my ability to chose a current account operated on terms which did not provide for charges such as (and/or equivalent to) those levied by your bank.

(9) The charges were (or had the potential to be) excessive in comparison with the level of borrowing which triggered the levying of the said charges.

In particular, and without prejudice, the burden of proof for the above rests onNatwestto prove that the circumstances of our relationship are fair (pursuant to s.140B(9) of the Consumer Credit Act 1974), so unless you can provide evidence to the contrary I expect a refund of the full amount requested by return.

The charges total £3,098.60, plus as I believe I have been unfairly deprived of the money I have calculated £541.68 interest at the statutory rate, the amount a court would award and I ask that you repay me the full amount of £3,640.28. I have attached a full schedule of the charges with this document.

I look forward to a full response to this letter within 14 days and if I do not receive a satisfactory response I intend to pursue my complaint to the Financial Ombudsman Service or small claims court at the earliest opportunity.

Yours faithfully,

Mr. XX



Enc. Complete list of unfair charges within last 6 years
Account Number: ********
Sort Code: ******

UNFAIR CHARGES – January 2005 to present

Premier_2

If you want to be considered under financial hardship grounds, you will have to supply the information they have asked for. For housing costs, you would include rent or mortgage interest costs. If the house is fully paid up, then you don't appear to have any such costs.

Anyway, I'm not sure you would qualify as financial hardship as you don't appear to mention any priority debts.
As you are now in the third period of unemployment in the last 6 years, it may even be argued that you are not currently suffering from a sudden and unexpected drop in income.

There's a sticky on 'financial hardship online resources' that gives much more information. Note how it is based on 'household income', not an individuals.

Be aware that most recent reported successful claims based on genuine financial hardship only get a maximum of about 6 months charges back (although you are correct to ask for them all to be considered)

If you are claiming on the basis the charges are legally unfair, best of luck! No one has succeeded in court on this forum following the advice given since the Supreme Court ruling, and banks are vigorously defending such attempts.

JROxford1978

Hello Premier,

Thanks for your speedy reply.

My situation is that the house is not paid off - we pay a mortgage every month from a joint bank account (into which I pay £XXX every month to contribute to all our joint costs).

I don't have any priority debt arrears now. As I mentioned, my problems with these unfair charges were sometime back - it was then that I was struggling.

If this cannot be taken into account then it appears that the 'legally unfair' route may be my only option.

Premier_2

JROxford1978 wrote: »

...I don't have any priority debt arrears now. As I mentioned, my problems with these unfair charges were sometime back - it was then that I was struggling.
...

That will be an issue.

Because all the banks have to do is treat financial hardship claims with a 'sympathetic and positive approach'.
If you are not in financial hardship now, what the banks have to consider is would repaying bank charges now have any positive effect on the financial hardship you claim you were once in? I think the answer to that is clearly no.

Vegeeta316

Would it still be an issue if the repercussions of the charges are still being felt now? I know in my case that because I was caught in a trap (and I can't walkt out ) of being charged £38 pounds weekly due to charges for quite a few periods of time, I was unable to pay my credit card / loans etc which ended up in arrears and I'm now paying collection agents rather than the bank themselves?

Premier_2

Vegeeta316 wrote: »

Would it still be an issue if the repercussions of the charges are still being felt now? I know in my case that because I was caught in a trap (and I can't walkt out ) of being charged £38 pounds weekly due to charges for quite a few periods of time, I was unable to pay my credit card / loans etc which ended up in arrears and I'm now paying collection agents rather than the bank themselves?

If refunding some of your charges would have a positive effect on your financial hardship, then the bank may (and I say may, not will) consider a refund.

However, they may decide that an alternative resolution meets the 'sympathetic and positive approach' to a financial hardship claim.

The question may be asked as to why you didn't raise the issue of financial hardship at the time you were in such state.

Vegeeta316

Premier wrote: »

If refunding some of your charges would have a positive effect on your financial hardship, then the bank may (and I say may, not will) consider a refund.

However, they may decide that an alternative resolution meets the 'sympathetic and positive approach' to a financial hardship claim.

The question may be asked as to why you didn't raise the issue of financial hardship at the time you were in such state.

Honestly because I didn't know enough to say I was suffering hardships at the time. Even the CCCS who were going to manage my debts at one point (which never transpired) never told me that was an option.

Ignorance is a poor defense I know...