Refund of Bank Charges

[Slim]

Guess what fell onto my doormat this morning....

A CHEQUE FOR £2500!

For the past couple of months I have been suing my bank for the last 6 years worth of bank charges.

For 3 years of that I was a poor student. The bank hit me hard with charges for bounced direct debits, unauthorized overdrafts and letters.

You may or may not have seen all the fuss recently on bank charges, (it has been featured on GMTV and Radio 4's Moneybox). Basically bank charges are illegal. They contravene the Unfair Terms in Consumer Contracts Regulations within contract law.

I originally saw this on GMTV when I was off work sick one day. It occurred to me that I must have a lot of charges which I could claim back. They mentioned a forum set up by a law student who was the first to do this. The forum is brilliant. They offer free advice and support and have a library of all the letters you need to send to the bank.

2 months, 3 letters and 1 online court claim later and I am now £2500 richer.

It applies to anything that can be described as a penalty charge. Credit cards, store cards, bank accounts, mortgages, loans etc...

I don't want to go into too much detail or post a link to the forum without the mods permission.

MODS: maybe you could let me know if this is ok?

I am just so exstatic that I want to let people know about it so they can do the same.

ps I have no affiliation to the forum mentioned

 

[Adam]

Sure, why not post a link, and well done on getting the money back. I'm sure its directly relevant to any members who are running woodwork businesses, and also to a wider membership.

As an aside (and not directed to you in any way) As topics like this (money politics etc) quickly turn into rants, please everyone, keep it on the straight and narrow!

Adam

 

[Slim]

Great.

The website is http://www.penaltycharges.co.uk

Have a read of their website, then check out the forum.

For proof that it works, have a look at their 'Litigation in Progress and Success Stories' section, then check out the success stories.

People are claiming back anywhere between £30 and £15000.

I really do hope that if anyone is in the same situation as me, where anytime in the past 6 years you have received a disproportionate charge from your finacial institution, you will check out this forum and get your money back!

 

[brianhabby]

Another link that might be helpful is here.

The page is on this very topic and the whole site is run by Martin Lewis, who often appears on TV consumer programs. The site is all about saving money in lots of different ways and well worth a visit even if your bank doesn't owe you any money.

regards

Brian

 

[suprasport]

another one here we have helped reclaim over £200,000 (it is my site by the way so if thats a problem i understand) :wink:

http://www.consumercorner.co.uk/forum

 

[Freetochat]

Just beware that some banks are closing accounts of those that make a claim!

 

[suprasport]

A&L being the biggest culprits but someone has just been awarded £150 by the FSA because of it. they are not supposed to be taking any form of retaliatory action, especially closing accounts, besides it is easy enough to open a new one and they have got to give you 30 days notice. So its no big deal :wink:

 

[dedee]

I recently went overdrawn on a small current account I have with Barclays. This is not my main account but one I have used for getting work expenses paid into and then use as a "tool fund". I also get the child tax credit paid in to it and then a standing order pays out to savings account.

I did not realised I had gone overdrawn ( I read a mini statement wrongly and withdrew too much cash) until I received a notice from the bank charging me £30 for going overdrawn. In the same letter they went on to explain that as I was a good boy and the account was previously well managed they would refund the £30 immediately. :shock: I was astounded.

Andy

 

[misterfish]

Yes, it's not only bank charges. We paid off our mortgage a few years ago and were charged a final fee. It seems that this must be the amount specified in the documentation when the mortgage was taken out, but most lenders have increased their fee.

I was perusing Martin Lewis's Moneysavings Epert website where it pointed out these increases were wrong and to claim the excess taken - it gave a list of useful phone numbers.

All I had to hand was the account number of the mortgage - so I rang Halifax, gave them the number and within two minutes was told by a very nice young man that I was due a refund of £60. I'm pleased to say the cheque arrived within the week. :lol: :lol:

Now if I could always work for £60 for two minutes .....

Anyway, if you've paid off a mortgage in the last few years it's worth a quick check.

MisterFish

 

[suprasport]

they are called mortgage exit fees.
it goes further than that as well, it applies to any contract for example if you were charged for leaving a mobile phone company early, you can reclaim that money.
I actually used to help lewis and gave him a few recomendations.

 

[Slim]

they are called mortgage exit fees.
it goes further than that as well, it applies to any contract for example if you were charged for leaving a mobile phone company early, you can reclaim that money.
I actually used to help lewis and gave him a few recomendations.

This is still a very grey area. The increase in redemption charges is definately claimable. However the redemption fee itself may not be. There are people who have won, but there are also people who have lost.
Unfortunately the amount that people are claiming on these is often in excess of £5000. Claims of this size are taken out of the small claims route and put into the fast track route. There is no protection for claimants in the fast track route and FULL legal costs can be claimed by the bank if they win. There are several stories on both www.penaltycharges.co.uk and www.consumeractiongroup.co.uk where people have lost and come out of court with a £10,000 bill for the banks legal expenses.

The advice being given on these websites is stick to claims unde r£5,000. The small claims route does not award legal expenses to the winner if the claimant is an individual.

 

[suprasport]

they are two totally different entities, but i agree that redemption penalties are a touchy subject at the moment, however we are working on that as well and are also advising claims for less than £5,000 to hold off for the time being as well, because if they do lose fair enough there are no costs awarded but when this gets resolved they may not be able to claim again. allthough some existing claims are still going through with success

 

[Slim]

Yes, sorry supra. Of course you're correct. So are exit fees completely recoverable? or is it just the increase? as they are not due to a breach of contract how are they penalties?

 

[suprasport]

Yes, sorry supra. Of course you're correct. So are exit fees completely recoverable? or is it just the increase? as they are not due to a breach of contract how are they penalties?

No problem.
They are nothing to do with penalties, the reason they are instantly refundable is because on the contract it will state the exit fee, but the mortgage companies have been increasing this figure and people have just paid it, but they are not allowed to alter the amount from the contract, the FSA stepped in and it is usually very straightforward with a phone call or a simple letter. In actual fact they are only required to pay back the difference but most are just paying back the full amount. :wink:

 

[Slim]

Did you see 'Tonight with Trevor MacDonald' last night? It was about equity release plans, and how the banks have turned £30K loans into 200K debts.

I have really had it with all these examples of banks acting unethically and illegally. They really have to be reigned in. It seems like every other week they are caught doing something else illegal.

They say that the refund of all these bank charges will end free banking. Only recently the major banks announced profits of £40 billion. Why oh why do they have to recover the money they have had to refund from their illegal profiteering when they are reporting profits like that.

I have a claim underway with GE Money at the moment. Got a court date for 14th April. However GE have failed to comply with 2 court orders to respond to my court bundle, and I have had a few missed calls from their solicitors. Looks like another win in the bag. Capital One next me thinks. :lol:

 

[suprasport]

it wont be long before GE pay up, and i totally agree with you about the banks profiteering, but they will always move onto something else and find another way to subsidise their champagne parties. The FSA anf FOS are pathetic but then again what do you expect from organisations that are paid for the banks and the banks are owned by the the rich and powerfull :evil:

Its upto people like you to stand upto them =D>

 

[misterfish]

Yes. In our case it was the mortgage early redemption fee. The amount I was able to claim back was the amount that Halifax had increased it over and above the figure specified in the original agreement document.

MisterFish

 

[DomValente]

This is all fine, recovering charges because we were overdrawn etc.
BUT, at least we know where we stand.
In many European countries you are charged for having an account, so you always have to be in credit otherwise they close it and sue you for the return of their funds.
In italy for example it's a criminal offence to bounce a cheque.
Soooooo if that's the way you want to go.................
Because they will.

Dom

 

[suprasport]

since when did we have free banking, it is subsidised by bank charges that are unlawful. the only people that benefit from free banking are those that dont need it and are living off people that are struggling. I know soe people ask for it and i know there are people that are broke but very very careful, but not everyone can handle things the same as others.
And it illegal to purposely bounce a cheque here aswell

 

[Slim]

The British Bankers Association (BBA) are saying that these claims will end free banking. But at least that way they are not preying on the poorest people for their profits.

An example: A single mother depends on her benefit payments to make it through the week, but one week her payment comes a day late. She has a direct debit due to come out of her account but doesn't have the funds to pay it. The bank bounce the direct debit and charge £30. This £30 charge puts the woman into an unauthorised overdraft for which the bank charges a further £39. The next day the benefit payment is received but most of it is taken by the bank to pay the charges. The woman then has no money to pay her other direct debits. Lets say she has 3 more. The bank bounces all of them, charging £30 each. That is £159 of bank charges. The next benefit payment goes completely on paying these charges, so next month DD's are bounced as well.

Is that fair? It is a spiral effect, that is very difficult if not impossible to get out of, as charges incur other charges which in turn incur other charges.

The BBC did an investigation into this. The asked 3 prominent people in the banking business to come up with a realistic figure of what it costs the bank to bounce DD's and run overdrafts. The highest figure they could come up with was £4.50. That means on a £30 charge, £25.50 is profit. Totally illegal and highly unethical.