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Bank Charges Test Case Article discussion
Comments
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At last someone in authority has seen some sense. If people do not want to pay the charges that banks make for UNAUTHORIZED overdrafts the they have two choices 1. don't go into overdraft or 2. change to a cheaper bank.
I don't see why I and millions like me should pay for these people to be so fickle with their money - they should grow up and look after their money.
I have been through some very bad times financially in the past but have never gone into the area of these charges.0 -
What annoys me is that the banks seem to make out that you were actually going overdrawn to get the charges, i didn't, because they didn't honor DD's and charged £35 a time for the pleasure.....
Which is another reason why any sane person would call such a charge 'unfair'.
It seems completely unbelievable that someone on a £60 a week benefit can get charged £35 for an error in timing that might put them a few pence overdrawn. I've been there, done that. The problem is compounded by the bank then charging you for being overdrawn - when they forced the position.
As one of the law lords said: "It's Robin Hood in reverse".
And some people really don't get it - these charges don't allow you to have free banking. Although they hurt the people they are levied on (usually the poor) they don't subsidise the rich. They merely increase the bank's profit margin so it can pay out excessive bonuses and higher dividends to its shareholders. The banks thought they might lose this case so their PR machine went into "let's frighten the masses" mode. Banks look for extra income wherever they can get it. Remember that only a few years ago they tried charging for using ATMs? They soon dropped that when people stopped using them and went into branches instead. They'll do whatever they can get away with - count on it.0 -
At last someone in authority has seen some sense. If people do not want to pay the charges that banks make for UNAUTHORIZED overdrafts the they have two choices 1. don't go into overdraft or 2. change to a cheaper bank.
I don't see why I and millions like me should pay for these people to be so fickle with their money - they should grow up and look after their money.
I have been through some very bad times financially in the past but have never gone into the area of these charges.
I think that you are very lucky then that you have never had an unauthorized overdraft charge, because millions have. Why do you assume that people that have been heavily charged by the bank have been fickle with their money?
I have recieved charges in the past. It doesn't mean that I've been careless with my money, or fickle for that matter. The charges have just made it harder for people like my self to ever get our finances straight.0 -
"..........And some people really don't get it - these charges don't allow you to have free banking. Although they hurt the people they are levied on (usually the poor) they don't subsidise the rich. They merely increase the bank's profit margin so it can pay out excessive bonuses and higher dividends to its shareholders. The banks thought they might lose this case so their PR machine went into "let's frighten the masses" mode. Banks look for extra income wherever they can get it. Remember that only a few years ago they tried charging for using ATMs? They soon dropped that when people stopped using them and went into branches instead. They'll do whatever they can get away with - count on it."...............
That's probably true - but it was a cert that if this judgement had gone the claimants way, we would have all had to pay for basic banking.
Which wouldn't have helped anyone - including those that went overdrawn because they are skint!
Lin
You can tell a lot about a woman by her hands..........for instance, if they are placed around your throat, she's probably slightly upset.
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The OFT should do a comprehensive study of how we can avoid using banks altogether where possible if we choose to do so.
That Needing a bank account for benefits, paying bills and wages has slowly been forced upon us and given the banks a clear monopoly on our finances should be investigated and reformed.
Irrespective of the charges issue consumers are often given little or absolutely no choice but to have a bank account. Whether it is easier or not to have a bank account is also irrelevant and I for one would like more choice in how I run my own financial affairs.
You have got a choice - draw out wages, etc., as they go in, in cash, then go and pay cash for bills etc.,
You won't be charged, and you can handle your finances as you like.;)
That's what millions of pensionsers do every week.
Lin You can tell a lot about a woman by her hands..........for instance, if they are placed around your throat, she's probably slightly upset.0 -
As a lawyer practisng in litigation in Scotland I can say that the general view of those other lawyers I have spoken to is that the Supreme Court judgement does not overly affect matters one way or the other.
Firstly it is reasonably clear that all they were being asked was whether or not the OFT could intervene on a narrow ground of law. The Supreme Court has said no they can't but only on that very narrow ground while pointing out at the same time that their decision might not have been the same had the OFT proceeded to ask if they could intervene on another different ground. (perhaps a small side swipe at the OFT legal team?)
However that case only decides if the OFT could stick their nose in on 1 ground under the legislation- to use the vernacular.
It does not decide that account holders have no rights to contest the charges. Nor that the OFT could try again under differing grounds.
I work in Scotland and can't say whether the same law applies in England but here in Scotland charges can only be made by the banks to reflect the actual loss incurred by the Bank in dealing with the unauthorsied overdraft. Otherwise it is considered not a compensation for breach of contract but truly a "penalty". Under Scots common law such charges are unlawful in that they do not make a fair reflection of the loss incurred and are not compensatory but punitive.
The issue to be fairly decided is not that account holders should get off "Scot free" but that the payment that they should be making is a true reflection of the loss to the Bank.
To think of it another way - what if you found that somehow you had breached a contract with someone else and they had lost say, £200 as a result. They then produce a contract which says they can claim what they like and they ask you for £1,000 instead without any specification as to how they come to that figure. That sound fair? Clearly not. You and I would not get away with it in ordinary life so why should the banks be allowed to by operating a cartel.
I find it difficult to understand how the banks can justify a fee as high as £35 per computer generated letter when a lawyer will typically charge £20 for a bespoke letter of the same length dictated by a professional and containing specialist advice!
And its not about free banking. The banks have put out feelers in years past when they were making these charges unchallenged to guage reaction over the possibility of losing free banking.
Banks have operated hidden charging arrangements for years and made fortunes. Just one example was Bank of Scotland who would not credit solicitors accounts the day a B of S cheque was paid in but would debit their account the day a cheque was paid out. The result was that over several days the bank had the use of the cash and also didn't pay interest but would charge it.
Anyway my suggestion would be that if you are in Scotland proceed with the litigation. Especially if the value of the case is under £3,000 and can be done under the Small Claims procedures where you can do it yourself and costs are restricted.
best wishes
Lawscot0 -
just wondering what would happen if 1 million bank accounts suddenly closed in britains banking system...?missed direct debit charges,very odd,theres no pain so how come the big gain,i.e £39.00 for a letter0
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As a lawyer practisng in litigation in Scotland I can say that the general view of those other lawyers I have spoken to is that the Supreme Court judgement does not overly affect matters one way or the other.
Firstly it is reasonably clear that all they were being asked was whether or not the OFT could intervene on a narrow ground of law. The Supreme Court has said no they can't but only on that very narrow ground while pointing out at the same time that their decision might not have been the same had the OFT proceeded to ask if they could intervene on another different ground. (perhaps a small side swipe at the OFT legal team?)
However that case only decides if the OFT could stick their nose in on 1 ground under the legislation- to use the vernacular.
It does not decide that account holders have no rights to contest the charges. Nor that the OFT could try again under differing grounds.
I work in Scotland and can't say whether the same law applies in England but here in Scotland charges can only be made by the banks to reflect the actual loss incurred by the Bank in dealing with the unauthorsied overdraft. Otherwise it is considered not a compensation for breach of contract but truly a "penalty". Under Scots common law such charges are unlawful in that they do not make a fair reflection of the loss incurred and are not compensatory but punitive.
The issue to be fairly decided is not that account holders should get off "Scot free" but that the payment that they should be making is a true reflection of the loss to the Bank.
To think of it another way - what if you found that somehow you had breached a contract with someone else and they had lost say, £200 as a result. They then produce a contract which says they can claim what they like and they ask you for £1,000 instead without any specification as to how they come to that figure. That sound fair? Clearly not. You and I would not get away with it in ordinary life so why should the banks be allowed to by operating a cartel.
I find it difficult to understand how the banks can justify a fee as high as £35 per computer generated letter when a lawyer will typically charge £20 for a bespoke letter of the same length dictated by a professional and containing specialist advice!
And its not about free banking. The banks have put out feelers in years past when they were making these charges unchallenged to guage reaction over the possibility of losing free banking.
Banks have operated hidden charging arrangements for years and made fortunes. Just one example was Bank of Scotland who would not credit solicitors accounts the day a B of S cheque was paid in but would debit their account the day a cheque was paid out. The result was that over several days the bank had the use of the cash and also didn't pay interest but would charge it.
Anyway my suggestion would be that if you are in Scotland proceed with the litigation. Especially if the value of the case is under £3,000 and can be done under the Small Claims procedures where you can do it yourself and costs are restricted.
best wishes
Lawscot
Lawscot, I do have a question because the penalty argument was ruled against early on in the OFT test case. Would that have any effect on the argument in Scotland?0 -
The OFT should do a comprehensive study of how we can avoid using banks altogether where possible if we choose to do so.
That Needing a bank account for benefits, paying bills and wages has slowly been forced upon us and given the banks a clear monopoly on our finances should be investigated and reformed.
Irrespective of the charges issue consumers are often given little or absolutely no choice but to have a bank account. Whether it is easier or not to have a bank account is also irrelevant and I for one would like more choice in how I run my own financial affairs.
They have kinda been doing that anyway. For example, we have had the Personal Current Account study, and they are still due to publish a further report on the fairness of charges soon.
PCA study is what you are thinking of and the report was published earlier this year by the OFT.0
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