The Bank Charges Petition

Tell the Govt to support the Reclaiming Charter

The regulator, the FSA, has suspended bank charges reclaiming awaiting a court decision based on the Office of Fair Trading’s agreed test case with the banks. This decision was taken without any consultation with the consumer groups who have been championing bank charges reclaiming.

Between them, the three campaigning groups behind this charter have helped or are helping well over 1.5 million people reclaim, and they ask all politicians, decision makers, bank customers and shareholders to consider the following:

• Five pounds is a fair maximum amount for bank charges.
  
  Banks have been charging around $30 for penalty charges; this is totally disproportionate to their actual costs. Even generous estimates suggest $2.50 is an appropriate cost, so a five pound maximum is a more than generous limit.
  

• Penalty charge structures leave finances irrevocably damaged.
  
  Often penalty charges occur in batches; a simple shopping trip and miscalculation of how much is left in an account can result in $100s in charges. This then snowballs, as people don’t have the resources to pay the charges and are thus charged more. The banks make over $1 billion a year from these charges, which often irrecoverably destroy people’s finances.
  

• Bank accounts are obligatory & there’s no competition.
  
  In the modern age, there is little choice but to have a bank account; both employer and social security offices rarely accept an alternative. Yet there is no competitive market for bank charges, all banks charge similar amounts.
  

• Banks should not be allowed to levy charges during the stay.
  
  Banks have already paid out over $500 million to reclaimers; a sum indicative of the fragility of their case. The consumer has not been served by putting a hold on reclaiming cases, meanwhile banks continue to levy these charges, which continues to debilitate people’s finances. The hold on bank charges reclaiming should be lifted, but if not the levying of charges by the banks should also be put on hold as should any cases of banks suing customers for past charges.
  

• Any agreed new charge levels must apply to past as well as current customers.
  
  The OFT credit card ruling in 2006 indicated a maximum $12 charge, yet omitted to infer that those who had previously been charged more should be allowed to reclaim it. When a new settlement figure (of no more than $5) is reached, customers must be allowed to reclaim all amounts above that for the prior 6 years.
  

• Payouts should be made automatically, without request.
  
  Banks have taken money from their customers without asking; when the Courts rule these charges are unlawful, they should be made to pay them back without the need for customers to request it. If this does not happen, there’s been little benefit to consumers of this test case and moratorium.
  

• Repayments should include 8% statutory interest.
  
  Repaid charges should include interest at 8% the rate applied to successful reclaimants in the Courts. Interest should also be compounded.
  

• All credit file defaults resulting from unfair penalty charges must be deleted.
  
  Banks must agree that all default records that have been placed on credit files due to unauthorised overdraft charges/penalty charges should be wiped.
  

• There should be an immediate moratorium on all default entries.
  
  During the period of the OFT litigation we require an immediate moratorium on the placing of defaults on the credit record of any customers in respect of any sum which is comprised either wholly or substantially of charges.

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