Challenge the Overdraft Charge

WelshConsumer · 25 November 2004 at 11:13AM

I run a small business with a large bank. I recently inadvertently went overdrawn (unauthorised) by approx £2. I then received my normal charges statement but added to this was a charge for £51.

£51 is penal and I wrote to tell the bank that I believed this was a penalty and did not represent the true cost to the bank for administering account and neither did it represent any costs incurred as a result of me being overdrawn.

I received a polite reply from the bank (Head Office - even though I wrote to my branch) saying that on this occasion they would waive the charge as a gesture of goodwill but reminded me that I should keep the account in credit.

This is a note to anyone that gets charged an excess fee: Excess Fees are PENALTIES in law and I do not believe they can be enforced. The banks will not pursue the matter because they do not want to be legal told this in a court of law as most people simply pay up.

Let me know of any similar successes.

bridiej · 1 December 2004 at 11:41AM

I've done this several times in the past with HSBC when I used to get overdrawn.

They used to charge £25, but I was only over drawn by £2 or £3 at most.

Everytime I queried it they refunded it!

damo101 · 6 December 2004 at 9:19PM

This happened to me with RBOS twice where interested the added put me over my limit and then they charged me 28 pounds. a letter to them each time got the charges refunded within a couple of days. I think its definitely worth writing to them to say that the charges are punitive and excessive - the worst that'll happen is you'll be the price of a stamp down.

Walletwatch · 6 December 2004 at 9:38PM

I keep getting a £0.01 charge on my Citi account for no rhyme or reason, I just call them up and they reverse it. This has happened around three times now - hardly an amount to follow up on, concern being that it shouldn't reflect as a negative on one's record with his Bank

Jodun · 10 December 2004 at 6:10PM

I've just come home to find a letter from my bank, I was over my overdraft for 1 day by £65.13 so they're going to charge me £58. Obviously I'm over because I'm short of money, so they charge me just about the same again!!!! ???

This happened because they honored a standing order when there was not enough credit available in my account - is there a way to stop them doing this in the future? I don't plan on making a habit of it of course, but is does happen from time to time. If I write to them and ask them not to honour direct debits/standing orders/swich transactions etc when there is not enough credit to cover it will this work? It's Bank of Scotland by the way.

Walletwatch · 22 December 2004 at 8:44PM

Walletwatch - I would keep a careful eye on this as it could lead to a sudden debit on your account for a large sum. Scammers/crooks often debit a card for 1p to see if the account is active before going in for the kill!
Eric

Hey

These are Citibank charges, that are levied because of some drawback on their system, which they have to keep reversing time and again - I don't think these are fraud transactions.

Never thought of 0.01 debits that way though. Thanx

johnllew · 22 December 2004 at 9:19PM

If I write to them and ask them not to honour direct debits/standing orders/swich transactions etc when there is not enough credit to cover it will this work?

I think they're to be commended for honouring your DDs and standing orders. Imagine the problems that might have been caused by failing to pay a direct debit to your credit card for instance - you could have been charged £25 by your CC for non-payment plus perhaps another £25 if as a result you'd gone over your limit, and you'd risk a black mark on your credit file.

Better to keep enough in your a/c to meet your obligations.

mdoo98 · 23 December 2004 at 7:12PM

I recently had a debit from my account with the A&L to the tune of £300 paid to the RBS, this was a direct debit I had cancelled the month before when I first set up the account. I didnt know about it for 9 days and it took me a further 9 days to get it back. As I was due to go overdrawn as a result, I politely advised the bank I would treat the matter as an unauthorised overdraft at their cost and according to their rules, i.e. first day free, 2nd £25, 3rd and 4th days free and 5th a further £25. Also that I had downloaded and was about to complete the Financial Services Ombudsman complaints form.
Hey !! guess what, they rang me on a Sunday morning to clarify a couple of points with me and the money was back in my account by Monday morning.
Result, treat them like they would you .... like scum.

Keith

Challenge the Overdraft Charge

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