Bank Charges Ruling Delayed

Martin Lewis, moneysavingexpert.com.

The OFT has delayed giving its opinion on whether it is legal or not for the high street banks to whack consumers who slip only a few pence into the red with penalty charges of up to £30 or more. Instead it's going to mount a full investigation (read Paul's earlier post for an explanation of the issue).

Now, let me declare an interest before I spout forth on this: I'm one of the guys behind the reclaim the charges campaign. No fewer than 2,150,000 free template letters have already been downloaded from the bank charges article on my site, so I'm party pre.  Yet in the interviews ...

I've been doing I've kept schtum on my musings on the real reason behind the postponement; as it's only supposition.

First it's important to understand, the OFT doesn't rule, it opines. A while back it said that in its opinion late-payment penalty charges on credit cards should not exceed £12. It had the co-operation of the banks on this, who dropped their charges accordingly.  Yet with bank charges, things have not been so simple. It's rumoured the banks wanted a much higher compromise level, say £15 to £18 and would not stomach anything less. But had this happened, I for one would have growled - and I mean GROWLED!. I would have said: "ignore it, the OFT has no power to enforce it... keep taking the banks to court and get the full amount refunded".

Caught between a rock and a hard place, the OFT's solution has been to announce a more detailed investigation. For consumers this is good news. When it does finally produce it's opinion it will be properly considered and not a quick compromise. And if the banks don't accede to it, the OFT will be in a position to take 'em to court to get a formal ruling.

In the meantime, we consumers can continue to lodge legal claims in order to get our money back.

Comments

[karen]

*** Comment deleted for excessive use of block capitals ***