Overdraft claimants’ cases put on hold
July 30, 2007 by admin
Filed under News, News-Banking
Bank customers’ hopes of reclaiming what they see as unfair and excessive charges for going overdrawn took a serious hit today.
Industry watchdog, the Financial Services Authority (FSA), announced that banks would be allowed to only give money back when their investigation was finished, which is anticipated to be towards the end of this year.
Previously, it was agreed that high street banks and the Office of Fair Trading would allow courts to decide on whether the fees were illegal or not.
The British Bankers’ Association (BBA) welcomed the news in a statement “Banks believe the fees customers pay for unarranged overdrafts are fair and clear. However, this is clearly an issue where customers, as well as the banks, would welcome legal clarity.”
The OFT strongly disagrees with this position, saying that banks are contravening unfairness laws and that it is “seeking to establish this legal principle in court”.
Banks have paid out an estimated £200 million this year to customers claiming repayment of the controversial charges, which have affected some of the most vulnerable, debt-ridden customers in the UK.
The backlash against the charges has been immense, with almost two million downloadable claims forms being accessed online by irate customers.
