Banks win right to appeal over overdraft charges

Once you've got their money, never give it back. It's a rule of acquisition, an old charter or something, and one the banks are sticking by no matter what the courts have to say on the matter. They're getting away with it too; as of yesterday, any chance you have of recovering trumped up account charges have been dealt by a blow from the House of Lords.

Last year, the High Court in London ruled the Office of Fair Trading (OFT) could decide on whether unauthorised bank charges were fair or not. At up to £35 a pop, most customers would say not. Seven banks and one building society appealed against the decision, obviously unhappy at the prospect of handing back money during a recession - overdraft charges generate an estimated £2.6 billion for banks every year.

Tough, said the Court of Appeal in February, who also stated there'd be next to no chance of getting their decision overturned. Except the Court of Appeal hadn't reckoned on the old boys in the House of Lords, who yesterday sided with the banks and agreed to their right to appeal. Now the case has to go back to court with a resolution unlikely for at least another twelve months, with more legal shenanigans funded by public coffers.

The long and the short of it is that if you've already submitted a claim to get your money back, don't expect to see it anytime soon. Banks are able to suspend charge complaints until the test case is over because of a long-standing FSA waiver, but the likes of Which? recommends customers continue to submit claim requests in the event of a favourable ruling sometime beyond the Second Coming.

If you haven't already submitted a cliam, This Is Money has templates and instructions for every step of the procedure.


  • Dave T.
    My Ex was continually racking up bank charges mainly because she was so stupid with money (mine) - how she failed to understand the concept of not going over her overdraft limit was beyond me. Paying her back this stupidity tax would just mean that I and millions of others would have to pay the bill in the end. Read the terms and conditions you nummies
  • Mac D.
    With so many direct debits and charges coming out of my account, there was a time in my life when I went over the limit on my account. My fault, i'm not a nummy! or a dummy! but sometimes it's hard, especially when you're trying to live with hardly any income and large outgoings (rent etc). Being charged £35 plus £30 commission each time is a joke - £65 for a letter and I always paid it back quickly. Penalties are fine, but £65 for a day is a crime. The house of lords are a joke for letting this get to appeal - it serves no purpose but to hold up the inevitable.
  • Lumoruk
    Unless the banks have treated the customers unfairly then they should keep the money. Why should I have to start paying a monthly fee for my account just because a minority of idiots can't manage their money.
  • gregd
    As always the headlines focus on the so called super tanker of 5 million claims by those who ignored the rules and now want a fiscal stimulus into their bank accounts paid by the rest of us. There are 131 milion indivdual accounts in Britain, we need to stand up for free banking and tell the 5 million to shut up.
  • Mac D.
    They have treated the customers unfairly - i'm not asking them to take any money from you. If it costs them £5 in manpower, then i'll happily pay it but taking £60 extra to play on the markets and lose, is the problem. Sometimes needs must, we can't all be perfect all of the time and i'm no idiot, I take offence. An idiot would let this go and pay up, probably go bankrupt in the long run.
  • Robert S.
  • acecatcher3
    one of my mates is in his first year of uni and is already well into his overdraft, he said he has about £1200 to spend.....i dont think he fully understands that the money will have to be payed back at some point lol what a turnip!!
  • Rash
    well said @Lumoruk, as harsh as it is - it IS true.
  • Jeffrey
    You lot who are saying 'learn to look after your money instead' - think, if nobody did go overdrawn and get charges, they'd have to switch to monthly fee banking anyway as there would be no charges. Secondly, you lot who are saying 'read the terms and conditions numptys' - thats the whole thing. The T&C's are UNLAWFUL and they should NOT be in there. Thirdly, those that say 'why should I have to pay for banking?' Thats a load of tosh that banks are spewing out to get people on their side. They make a fortune from you already, with investing your money in shares etc. Why should other people pay for YOUR banking facilities, anyway? The bottom line is, what the banks are doing, is UNLAWFUL. In the current climate when irresponsibly run institutions are losing billions, and rewarding inept directors huge payouts for doing so, they should be a little more accountable for their own actions.
  • Dave T.
    To MacD - I'll let you into a little secret - if you go overdrawn at the bank then they will charge you a lot of money making the situation worse. With that in mind do NOT go overdrawn. Banks are robbing bastards but they do make it clear when you sign up and when you start overdrawing. Wise up!
  • Mac D.
    I've not gone overdrawn in 3 years, but times are tough and if I can't help it then I don't want to be ripped off. I was signed upto this bank in 1974 by my Dad - the goalposts have been moved so many times that nothing is ever clear! I hate paying for my bank account, but that's got nothing to do with rip-off charges. Banks are there for their shareholders and when they get it wrong the taxpayer deals with it - it's a corrupt ystem all round.
  • princessbullit
    I disagree if i sign a piece of paper saying someone can shoot me tomorrow doesnt make it right or legal. I am a single mother who works 7 days a week, and,, sometimes when the banks can take card payments anytime up to 6 months after you make the purchase i can go over my limit. Sometime i really just dont have the cash as times can be hard. I hate people who smugly sit there and flick distain in my direction. I am NOT bad with money but if the money coming in is less than going out then what can i do? I dont go out drinking to the cinema or anywhere and haven't for ages. i dont spoil my child and money is always tight. I have bank charges in the past year and im not going to be made to feel bad for that. Its not fair, just or right that they charge £35.00 to send a letter to me and they have no right when, at the most i try to get my balance back into the green within 7 days. I agree that some are really clueless. But for all you smug bastards looking down on people like me and sneering at what you call our lack of common sense you can all take your comments and blow them up your ass.
  • Andy D.
    Correct. Excessive bank charges are unlawful. It begins and ends there. If the scrapping of free banking is the ultimate outcome in all of this, it'll be a move born wholly out of the banks' never-ending greed and desire to provide a decent dividend for their shareholders.
  • One B.
    [...] figures add weight to the growing belief that it’ll be 2011 at the earliest before the inevitable flood of refunds begins to trickle from the scumbag banks (apart from the [...]

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