Bank Charges OFT Test Case Discussion

maria-louise

I sent the Abbey national my 1st letter asking for my reclaimed bank charges on 03.07.07, which I still have had no reply to. I then sent a 2nd letter on 05.08.07 explaining that if they didnt reply within 14 days I would take legal action. I still haven't had a reply, what should I do????

Help!!!

krishen

Hi

Ive read the last few pages of this thread and martins guide but still not sure what to do. Ive only just received my bank statements for the last 6 years. Theres is about £400 of charges (with interest) that i would to like to claim, all within the last 6 years. With the test case and STAY going on, should i send them the first letter reclaiming my charges or should i wait and see what the outcome of the test case is first?? I dont really have the money to start a claim in the courts yet (being a student) but could get it if need be.

Thanks and sorry if it has been covered, i must have missed it.

Cheers
Krishen

bsr_2

Hi Krishen,

Go ahead and put in the claim with the bank. The bank will log it as a complaint, but at least it is logged. You should get a standard letter informing you that your complaint has been logged, there is a test case with OFT next year etc.

I too am a student so money is important and yes I would want my £400 back asap, however I feel that most of our claims will wait till next year or sooner if the OFT and banks come to an agreement.

Remember you can claim back on your credit cards also....

Good Luck,

Raj

Sue_Sarge

Just received my letter from HSBC (which I have 2 accounts) my charges add up to 1946.00 (excluding interest). The letter states that HSBC are waiting for the determination of the legal issues in proceedings with OFT and that they have asked the FSA to suspend the normal timetable for dealing with bank charges and that the FSA has agreed to this request. Can anyone tell me the next step I should take????:mad:

krishen

bsr wrote: »

Hi Krishen,

Go ahead and put in the claim with the bank. The bank will log it as a complaint, but at least it is logged. You should get a standard letter informing you that your complaint has been logged, there is a test case with OFT next year etc.

I too am a student so money is important and yes I would want my £400 back asap, however I feel that most of our claims will wait till next year or sooner if the OFT and banks come to an agreement.

Remember you can claim back on your credit cards also....

Good Luck,

Raj

Cheers. Ill get the letter off to them so at least they have a copy of my claim.

IZZY01

Have a read at this article in the Herald, regarding claiming in Scotland
http://www.theherald.co.uk/news/other/display.var.1684766.0.0.php

Stokey125

IZZY01 wrote: »

Have a read at this article in the Herald, regarding claiming in Scotland
http://www.theherald.co.uk/news/other/display.var.1684766.0.0.php

I see the Sheriffs agreed with my conclusion that as any decision in the OFT case would be only persuasive in Scotland a stay would not be appropriate. This has an advantage it seems we will have persuasive Scottish decisions that may be of use in England.

AndyM4c

Hi I am on disabillity benefit and my income support is paid directly into the Halifax on the BACS system. This week I was charged 2 lots of £39 for 2 missed Direct Debits. So before the bank could take what ammounted to my entire weeks benefit and leave me nothing for food I ordered a Giro payment meaning the bank wouldnt see a penny. While doing this a very nice man at the benfits agency informed me that the banks are not allowed to make charges when they know the only source of income is income support as IS is the minimum the law says you need to live on perhaps the lawyers need to look at this in their fight because being on benefits I have incurred loads of these charges as have many others in my situation. Perhaps the banks would like to comment on how they can justify stealing the food out of the poorest of mouths:mad:

ekent

I tried to recliam my bank charges about 3 months ago and the bank refused to refund me.
Once this case has been solved, would I be able to try again to get my money back?

Nathan_Spleen

To:
Nathan Spleen

From:
Natalie Baylis
Legal Advisor
General Council's Division
Financial Services Authority

cc. Laura Derby Chief Executive Office FSA

cc Simone Ferreira General Council's Division FSA

17 September 2007

Dear Mr Spleen

COMPLAINTS HANDLING WAIVER: PROPOSED JUDICIAL REVIEW PROCEEDINGS

Thank you for your letter of 2 September about your proposed Judicial Review proceedings in relation to the complaints handling waiver issued on 27 July. Mr Sants has asked me to respond to your letter as it concerns proposed legal proceedings against FSA.

You have asked why the complaints handling waiver has been introduced, and you have said that you are dissatisfied with the answers you have received to that question from the FSA to date. I will try to provide you with as full an answer as I can to your question. I am afraid however that this will involve some repetition of points that have been made to you in correspondence so far, as the FSA's position has not changed from that set out to you in our initial replies.

The complaints handling waiver was introduced, after careful consideration by the FSA Board, under section 148 of the Financial Services and Markets Act 2000. The background to the decision has already been set out to you in e-mail correspondence, but is central to why the waiver was introduced and so I will set it out here.

For some time customers of banks and building societies have been complaining about the charges levied in relation to unauthorised overdrafts. The legal uncertainty about whether the charges were lawful or fair meant that complaints made by customers were being determined, but with inconsistant
outcomes for customers. Some customers were successful but others with similar complaints were not.

In September 2006 the Office of Fair Trading announced that it would undertake an investigation into the fairness or otherwise of certain terms in current account agreements. Since then there has been a significant increase in the number of claims made by customers against banks and building societies in relation to these charges, and in complaints and claims taken to the Financial Ombudsman Service
and to the courts.

The FSA considered that it was desirable for there to be further clarity as to how these complaints should be handled fairly and consistantly, by obtaining greater legal certaincy or otherwise.

The FSA was also concerned. following the results of thematic work that it undertook to access the extent to which firms were complying with the complaints handling rules in dealing with complaints about unauthorised overdraft charges, that there were significant deficiencies and important areas of weakness to their approach to handling these complaints.

At the end of July the OFT and certain banks announced an agreement to start a 'test case' in the high court for a declaration to resolve the legal uncertianties concerning the level, fairness and lawfulness of unauthorised overdraft charges.

In view of those developments, the FSA considered that it was not in the interests of consumers for complaints to continue to be dealt with inconsistancy by firms while the test case was still proceeding through the courts. Once the test case is resolved it is expected to give greater legal certainty in this area and to enable complaints about these charges to be handled fairly, consistantly and promptly
in the light of that greater certainty.

After careful consideration by the Board, the FSA decided to grant the complaints handling waiver to current account providers who consented to it's conditions. The vasr majority in terms of number and market share have done so.

The main effect of the waiver is to waive the rules that specify time limits for dealing with any complaint about the level, fairness or lawfulness of unauthorised overdraft charges. This means that the banks and building societies will not have to deal with these complaints within the normal time periods required by our rules. The waiver does not prevent customers from making complaints whilst it is in place, and firms with the waiver are required to log these complaints to be dealt with on resolution of the test case.

You have asked for information to satisfy you that the waiver is genuinely in the interests of consumers. I hope that the background to and the reasons for the decision which I have set out go some way to answering your question.In addition the waiver has a significant number of other safeguards built into it, in the form of conditions applying to the firms, which are designed to protect consumers.

I have enclosed a copy of the waiver direction with this letter for your information:

A Conditions (1), (2) and (3) in prargraph 12 are designed to ensure that customers and complainants are kept appropriately updated about the course of the test case, the waiver and there implications.

B Condition (4) relates to the procedure that banks and building societies must follow where they have made an offer to a customer to settle a complaint which has not yet been accepted.

C Under conditions (5) and (6) firms must keep records of complaints received and preserve records of current accounts so that they remain available for the consideration of existing and future complaints.

D Conditions (7) and ( make requirements on firms which are parties to the test case in relation to their conduct to the case.

E Condition (9) requires all firms to update the FSA about stays of relevant court proceedings obtained.

F Conditions (10) to (15) relate to the handling of complaints by firms during and after resolution of the test case. One important protection for consumers whose complaints relate to financial hardship. Condition (10) requires firms to ensure that complaints relating to financial hardship (and others which are not relevant to the waiver) are identified and progressed promptly in compliance with normal rules and timescales in the Disputes resolution: Complaints manual of the FSA
Handbook.

G Condition (12) prevents firms from taking into account the time period of the waiver to rely on a 'limitation' or time limit defence to a subsequent complaint by a customer.

H Condition (14) prevents a firm from seeking 'full and final settlement' of a complaint during the life of the waiver.

I Conditions (11) and (15) require firms to handle complaints effectively and swiftly and in accordance with the principles established by the test caseafter it has been resolved.

Finally, the waiver is of limited duration: it will end when the test case has been resolved or at the end of one year if earlier, and in addition the FSA may revoke the waiver at any time if the criteria for the waiver are no longer satisfied. The guidance in the waiver direction (paragraph 7) sets out the approach that the FSA intends to take to the planned review of the waiver at the end of September, to considering renewal of the waiver after a year and to reviewing continuing satisfaction of the criteria for the waiver throughout its duration.

You have also asked for information to satisfy you that the waiver is neccesary to facilitate the OFT's test case which is one of the reasons for the waiver set out in the press release and in information about the waiver on the FSA website. The waiver will facilitate the test case in that it will allow the test case to proceed ahead of the other outstanding (and future) complaints about these charges. Once the case is resolved it will then provide some legal certaincy against which those complaints can be judged, which should result in fairness and consistancy between the outcomes of those complaints.

We acknowledge that our decision will lead to inconvenience and delay for some consumers - particularly those who were in the advanced stages of making a claim - in that their complaint will now not be resolved for some time. However we are clear that, bearing in mind the background against which our decision was made, and the conditions which are contained in the waiver, it is in the broader interests of all consumers in the longer term.

I hope you have found the information in this letterhelpful. It is a matter for you whether you still wish to challenge the FSA's decision by way of Judicial Review. We fully reserve the FSA's position in relation to any proceedings you may choose to bring. Should you decide to do so, however, you should be aware that it is our policy to recover from a claimant our costs of defending an action if unsuccessful legal proceedings are brought against us.

Yours sincerely

Natalie Baylis