Bank Charges

What was the recent test case?

The judge in the test case ruled that the OFT could decide whether the charges imposed by banks were unfair. This meant that consumers were a step closer to reclaiming their charges. The banks appealed, however, and the Supreme Court ruled against the OFT.

What does this mean for me?

At the moment, this means that any claims to regain bank charges you might have already submitted are likely to be rejected unless you can show the bank charges have contributed to any financial hardship.

The banks should still deal with any hardship cases. There isn't a firm definition of a hardship case, but it is likely to apply to you if your income is not enough to cover reasonable living expenses or if you are struggling to pay debts, such as mortgage arrears. If your bank doesn't help, you can complain to the Financial Ombudsman (FOS).

What if I've already had money back?

You won't have to return any money you've already reclaimed as these payouts were gestures of goodwill rather than legal agreements.

What will happen if I claim hardship from my bank?

Your bank should respond within 14 days. If they don't you should complain to FOS.

You have two months to decide whether to accept an offer or not. If you don't contact your bank within that time, your bank will assume you have rejected it.

Where can I take my complaint if I reject my bank's offer?

You can complain to FOS if you are unhappy with the offer or you can file a claim with the small claims court (this is your local county court). There is a fee to file a claim, although you will get this refunded if your bank pays up. If you have a large claim, your bank is more likely to do nothing until you file a claim at court. However, if you do go to court, you are unlikely to be able to use the free service provided by FOS to help you with your claim in future.

How do I get information about the bank charges I've paid?

Under the Data Protection Act your bank must give you information about charges you've paid if you ask for them. They should provide this within 40 days and they cannot charge you more than £10 if you ask for computer printouts (rather than actual copies of statements). If they do try to charge you more or to stop you getting the information you should contact the Information Commissioner (ico.gov.uk or 08456 30 60 60 or 01625 54 57 45).

Can I get back any charges on an account I've closed?

Yes, you can reclaim any charges on your present current account or any account you have used during the past six years. If you are complaining about a closed account, remember to give details of any old addresses, especially if you have since moved house.

Can a bank close my account if I challenge the charges?

If you are using the complaints procedure to challenge unfair charges you should not have your bank account closed. If the bank does threaten to close your account you should contact the free and impartial FOS at financial-ombudsman.org.uk or 0845 080 1800 or 020 7964 0500.

Do I have to go through the same process if I am trying to get back fees I was charged due to bank error?

You should still write a formal letter requesting that your bank refund the charges. However, as this is not about whether the charges were fair or not, your bank should be able to deal with your request straight away. If they don't, you can refer your complaint to FOS.

What about reclaiming any credit card charges?

The test case does not apply to these, so you can complain about credit card fees now. For more information visit which.co.uk/money.

Can I make a claim myself or do I have to use a claims company?

It is easy to make the claim yourself and you do not need to use a claims handler. If you do decide to use one, be aware they usually keep a percentage of the money you get as their fee. All claims management companies have to be regulated and must comply with a strict code of conduct. For information, visit claimsregulation.gov.uk.

Can I reclaim my bank charges in Scotland?

The law is a bit different in Scotland and you can only claim back five years of bank charges rather than six. The findings of the test case also will not necessarily apply in Scotland. You should get advice as there could be issues about the timing of your case. You can get information from the Govan Law Centre website at bankcharges.info.

This fact sheet will give you some basic information about bank charges.

Please be aware that this is not legal advice and if you are concerned about any of the issues mentioned you should speak to a lawyer.

You can contact Russell Jones & Walker's solicitors at enquiries@rjw.co.uk.

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