Bank Charge Reclaimers In Hardship Mis Treated By Banks

Bank charge reclaimers in hardship mistreated by banks

22/10/2009
Rachael Stiles

The Financial Ombudsman has reprimanded banks for ignoring the hardship of some customers trying to reclaim their bank charges, consumer revenge website MoneySavingExpert has reported.

Thousands of current account customers are awaiting the outcome of a court case to establish whether or not banks will have to repay millions of pounds in what the OFT has deemed 'unfair' charges for exceeding agreed overdrafts.

But, in the meantime, banks have been told that they should consider refunding those customers who are in financial hardship, which the banks have been failing to do, MoneySavingExpert.com has learned.

Reclaiming bank charges is on hold for everyone else until they are clarified by law, and banks are not obligated to deal with these claims until such a time, but the banks are breaking the rules by ignoring the claims of those in hardship.

There have been a number of reports on the MoneySavingExpert.com forum from customers who say their hardship was not taken into consideration by their bank, which the Ombudsman has reportedly confirmed and has subsequently stepped in, writing to all of the major current account providers, ordering them to comply.

The recession has seen an increase in the number of people reclaiming their bank charges on grounds of hardship, MoneySavingExpert says, which has helped those who have been successful in their claim to make ends meet.

Martin Lewis, creator of MoneySavingExpert.com, said: "We've seen a raft of complaints about banks replying with generic letters, playing runaround, using delaying tactics and ignoring people in dire need. It’s great to see the Ombudsman stepping in to try to change this."

He added that customers would not be in the situation they are in, where they are unable to have their claims heard, if the Financial Services Authority had not instigated a freeze on reclaiming, which it has kept renewing until the matter is settled.

Consequently, Mr Lewis said, "We're now in the bizarre scenario that even though two senior courts have ruled that fairness rules apply, banks can keep on charging, but most customers can't reclaim."

He added: "In truth, the Ombudsman doesn’t have the power to sort this. This is all about the FSA, which I believe has shot itself in the foot with this waiver, which was never structured to be in place for two-and-a-half years.

"The FSA should be investigating the fact banks are happy to play fast and loose with its rules, fine them for doing so and monitor how they operate, or stop the waiver altogether."

[righty]

Re: Bank Charge Reclaimers In Hardship Mis Treated By Banks

Can't disagree with Martin on this that's fer sure

[natweststaffmember]

Re: Bank Charge Reclaimers In Hardship Mis Treated By Banks

Martin Lewis, creator of MoneySavingExpert.com, said: "We've seen a raft of complaints about banks replying with generic letters, playing runaround, using delaying tactics and ignoring people in dire need. It’s great to see the Ombudsman stepping in to try to change this."
Not quite sure I am on his forum cos I haven't seen this. I've seen people with no case being told NO they aren't in hardship. I've seen them ask for Income and expenditure forms and proof of arrears. Does Martin Lewis run Moneysavingexpert? Don't really remember him posting much on the reclaims board.....
He added that customers would not be in the situation they are in, where they are unable to have their claims heard, if the Financial Services Authority had not instigated a freeze on reclaiming, which it has kept renewing until the matter is settled.
35 complaints about the application of the waiver to the FSA speaks volumes.
Consequently, Mr Lewis said, "We're now in the bizarre scenario that even though two senior courts have ruled that fairness rules apply, banks can keep on charging, but most customers can't reclaim."
Probably because they are judging on the fairness of charges but on the application of UTCCR 1999 to charges. He was at the court case, does he need to read the transcripts to know what the case was about?
He added: "In truth, the Ombudsman doesn’t have the power to sort this. This is all about the FSA, which I believe has shot itself in the foot with this waiver, which was never structured to be in place for two-and-a-half years.
More nonsense again, 35 complaints against the waiver is not much in the last 12 months since the hardship waiver came in.
"The FSA should be investigating the fact banks are happy to play fast and loose with its rules, fine them for doing so and monitor how they operate, or stop the waiver altogether."

The FSA monitor the waiver and furthermore do go to the various firms and make sure they are complying. No doubt the FOS also has some input to the FSA about the way that the FSA Waiver is being dealt with.,
Sometimes I wonder whether I need new glasses cos I am seeing a lot less than Martin Lewis sees these days.