Unemployed & Bank Charges

chalkiex

Hi,

I was made redundant from my Teaching post last January 2011 and in April 2011 had to sign on as was unable to secure a new teaching post - unfortunatley most schools don't start hiring until September...

Anyway, during the period between April and December 2011 I was in receipt of JSA and due to this shortfall in income I fell behind in certain areas like Gas & Electric my sky bill etc and charges were levied on my account for missed direct debits by Santander.

At the time when I tried to get it resolved and told them they could not take charges from my JSA they stated they could and would continue to do so. However, they did give me a reducing overdraft to cover the bills so that over a period of time I would have still paid back the charges and still recieved more during the process.

Does anyone know what the legislation is around this and if I can indeed claim these charges back?

Thanks in advance.
Steve.

Premier_2

chalkiex wrote: »

Hi,

I was made redundant from my Teaching post last January 2011 and in April 2011 had to sign on as was unable to secure a new teaching post - unfortunatley most schools don't start hiring until September...

Anyway, during the period between April and December 2011 I was in receipt of JSA and due to this shortfall in income I fell behind in certain areas like Gas & Electric my sky bill etc and charges were levied on my account for missed direct debits by Santander.

At the time when I tried to get it resolved and told them they could not take charges from my JSA they stated they could and would continue to do so. However, they did give me a reducing overdraft to cover the bills so that over a period of time I would have still paid back the charges and still recieved more during the process.

Does anyone know what the legislation is around this and if I can indeed claim these charges back?

Thanks in advance.
Steve.

You were wrong. They were entirely correct.

The only possibility to reclaim charges is as a goodwill measure offered by the bank to those in financial hardship. Read the MSE guide to reclaiming bank charges for more info.

dunstonh

oes anyone know what the legislation is around this and if I can indeed claim these charges back?

There is no legislation. It is an internet/man-down-the-pub myth based on misinterpretation of some guidelines.

You are reliant on the goodwill of the bank as Premier says above.

chalkiex

So the banks are allowed to take charges from money that is not income...
Even the people at the Job Centre told me that the banks were only allowed ot take money that could be classed as income.
But if as you say there is no actual legislation and that it is some internet myth then so be it.
I did use the letter that is on the Reclaim Bank Charges Link to explain my hardship etc and the bank basically told me to stop being silly and go away...
Do I still have a right to complain via the FOS?
Thanks in advance.

MonkeyMad

You always have a right to complain, but it won't go anywhere in this case.

Existing legislation does mention that benefits cannot be charged, but it doesn't mean charges as in costs it has an entirely different definition. It is as legal for banks to charge for their services whilst in receipt of JSA as it is for a supermarket to charge you for theirs

bengal-stripe

The Government’s response

The purpose of the Social Security Administration Act 1992 Section 187 and section 45 of the Tax Credits Act 2002 is to prevent people’s benefit money being at risk by it being assigned over to a third party in settlement of a debt. It is not intended to prohibit the application of bank charges. Bank charges are in the nature of an expense, and are incurred by the holder of the account; tax credits and benefits are payable in order to help customers meet their expenses, and as such it is legitimate for banks to deduct charges from the balance of an account held in that bank, whether the money paid into the account comes from tax credits, benefits or other sources, such as earnings.

http://www.consumerwiki.co.uk/index.php/Benefits_and_the_Social_Security_Administration_Act

dunstonh

So the banks are allowed to take charges from money that is not income...

Yes. And quite right too. Otherwise the asset rich , income poor could get away with blue murder.

Even the people at the Job Centre told me that the banks were only allowed ot take money that could be classed as income.

That is embarrassing for them but is a sad reflection of the current skills and knowledge required to be in such as job nowadays. Sometimes a little knowledge is a dangerous thing. That is how most of these myths start.

Do I still have a right to complain via the FOS?

The FOS wont consider complaints on unfairness. For hardship cases they can only encourage the bank to look at your case. They cant force the bank to do anything the bank doesnt want to.

GlamGirlie

chalkiex wrote: »

So the banks are allowed to take charges from money that is not income...
Even the people at the Job Centre told me that the banks were only allowed ot take money that could be classed as income.
But if as you say there is no actual legislation and that it is some internet myth then so be it.
I did use the letter that is on the Reclaim Bank Charges Link to explain my hardship etc and the bank basically told me to stop being silly and go away...
Do I still have a right to complain via the FOS?
Thanks in advance.

Yes they are! That myth has become really widespread but it's completely untrue.

You can complain to the FOS, there is nothing stopping you writing a letter, but as the court case found in the banks' favour the FOS won't take up your case.

Your only option was to appeal to the good nature of the bank re hardship and as they've said no, you've no further options to pursue, I'm afraid.