Bank charge victory for Lloyds TSB
May 31, 2007 by admin
Filed under News, News-Banking
One of the UK’s banks has made history by being the first to have its banks charges upheld in the fight against unfair and unlawful bank charges.
Many consumers across the UK have been claiming back bank charge fees from their banks, which were applied for exceeding the overdraft limit and also for returned direct debits and cheques. The fees go back as far as six years, and some banks had been charging nearly forty pounds per fee.
Last year regulators and campaigners in the UK deemed that these fees were unfair and unlawful, as each fee was up to ten times the actual cost incurred by the bank in terms of administrative costs. As a result of this many people tried to claim back these fees going back six years, and although banks were reluctant to pay out none of them defended the charges in court, which resulted in millions of pounds being paid back to claimants. Financial regulators in the UK are still trying to reach a decision with regards to what can be deemed a fair fee for banks to charge.
However, earlier this week Lloyds TSB was taken to court over the return of £2545 worth of bank charges by a Mr Kevin Berwick – and the courts ruled in the bank’s favour. This could have repercussions for all those that are planning to make a claim or that have pending claims.
In his ruling the judge stated: “Having held that the charges complained of are not charges for breach of contract but part of the price of the services provided by the bank… he has not satisfied me that he has any ground in law for recovering from the bank the amount of any charges which he has paid to it.”
A Lloyds TSB spokesperson stated: “It appears to acknowledge our position in respect of current account service charges. The court has agreed with us that these are charges for a service and not default or penalty fees as has been argued by others,”
Tom Smith
31st May 2007
