Penfold v Abbey (for the 4th time FFS!)

[srfrench]

Have done Gary..... no worries

[srfrench]

SOOOOOOOO................ ......... their charges are perfectly legal etc etc...?


So whats this all about then PMSL

The bank hopes fewer customers will get a nasty surprise

Lloyds TSB has become the first High Street bank to cut its charges for unauthorised overdrafts in the face of a continuing customer revolt.


The bank, one of eight facing a High Court test case next year, will introduce the charges on 2 November.

Lloyds will cut its interest rates for unauthorised borrowing by about a third and charges for going into the red and bouncing cheques will also be reduced.

Other High Street lenders may now also cut their charges, analysts said.
Richard Hunter of stockbrokers Hargreaves Lansdown said that Lloyd's move was probably the "thin end of the wedge".

Refunds

Earlier this year, the bank revealed that it had had to refund £36m to customers in the first half of 2007, after they threatened to sue for the return of allegedly unfair charges on their unauthorised overdrafts.

BANK REFUNDS IN 2007
Barclays - £87m
HSBC - £116m
HBOS - £79m
Lloyds TSB - £36m
RBS - £81m

Source: bank interim results



Between them, all the High Street banks and building societies have returned an estimated £570m in the same period.

Lloyds TSB said, however, that its decision to reduce the cost of running into the red for its current account holders was simply a response to consumer feedback, and not an attempt to anticipate the outcome of next year's test case with the Office of Fair Trading.
"We want to help our customers avoid accidentally slipping into the red and are giving them the tools to do just that," said Ian Larkin of Lloyds TSB.
"We understand that it can sometimes be difficult for customers to keep tabs on their account and we want to make it easier," he added.

Lower charges

Instead of charging customers £30 a day if they go into the red without permission, the bank will now charge £15 a month and then between £6 and £20 a day on a sliding scale, according to the size of the overdraft.
Its charge for bouncing a cheque, standing order, or direct debit is going down from £35 to £20.

And the interest rate applied to the unauthorised borrowing will be cut by about a third to bring it into line with the bank's interest rate for authorised borrowing.

The bank believes that most of its customers who go into the red do so accidentally.

So any customer in this position will given until 3.30 pm that day to get in contact with the bank and make up the shortfall, thus avoiding any charges at all.
To help them do this the bank is offering an extra text message service, which will alert customers if they are within £50 of their overdraft limit, or if they have actually gone over it.
"Customers who do accidentally go over their limit, will be better off as they have the chance to top up their account and get themselves back on track," said Mr Larkin.

Scepticism

The move by Lloyds TSB was greeted with scepticism by the Consumer Action Group (CAG), which has been leading the customer revolt against bank charges.
Marc Gander of the CAG said the revised charges were still excessive.
"I think they are still well over the top," he said. "On the basis that the real cost of sending a letter or bouncing a cheque is about £2.00, then the mark-up is still very high."

[srfrench]

PMSL....... we've been here before!!!!



OFT may compromise on bank fees

By Ian Pollock
Personal finance reporter, BBC News



The Office of Fair Trading (OFT) could drop next year's High Court test case over bank overdraft charges, a senior official has said.


But the OFT added it would only do this if the banks put forward an agreeable compromise and if such a deal was in the best interests of customers.

The court is due to decide next year whether the OFT has the power to rule that bank overdraft fees are unfair.
The eight banks challenging the OFT say it has no jurisdiction in the matter.

On Monday, Lloyds TSB became the first of the big High Street banks to cut some of its overdraft fees, after paying out millions of pounds in so-called "goodwill payments" to tens of thousands of unhappy customers.

Lloyds customers - and those of other banks - have claimed that charges levied for running up unauthorised overdrafts are illegal and unfairly high.


Negotiation

Other banks are expected to copy Lloyds example in coming months.

Any such changes will not, on their own, deflect the OFT from its legal action.

But a senior official, Cavendish Elithorne, made it clear that the OFT was open to negotiation on the issue.

"If we do our own financial analysis, and they [the banks] come in with a number that is lower than our analysis would suggest is an unfair charge, there is no need for the court case to go forward," he said.

"We will be looking out for what is the best outcome for the consumer."

But Mr Elithorne did stress that so far there has been no face-to-face negotiation with the banks.


Authority

However, if and when, the judge will not be asked to rule on whether bank charges are legal or fair.


Instead the judge will have to decide whether the OFT has the authority to decide the issue itself, under the Unfair Terms in Consumer Contract Regulations.

The OFT believes typical bank overdraft fees come under these regulations, that they are unfair and that it therefore has the power to order changes.

But banks argue that the charges are a core feature of their current account business and so they are not covered by the regulations, they are fair and that the OFT has no powers in the matter.


Agreement

Intriguingly, the OFT revealed that it actually agrees with part of the banks' arguments.

They claim that their charges are not penalties, but are fees for a service - for running a current account while it is in the red.

"In most instances we would probably agree with the banks' arguments that these are not penalties as defined in common law," said Mr Elithorne.
But he insisted that the OFT Still believes the charges are unfair - even if they are "fees for a service".
"We think the fairness test will still apply," he added.
All these legal arguments will be novel in the UK courts and are clearly of great importance to both sides.
However a final decision may be more than a year away if the case goes to the Appeal Court and then the House of Lords.


No more free banking?

With the OFT two-thirds of the way through a nine-month investigation into the fairness of overdraft charges, banks are now giving the watchdog their own estimates of how much it costs to run an account in the red and to bounce cheques.

The regulator is about to do its own number crunching to establish what level of charges it believes are unfair.

However, it estimates that fees and charges for going overdrawn without permission bring in between £2bn and £3.5bn a year to the UK banking industry's revenue.
The OFT has denied that the case could lead to the reintroduction of monthly or annual account charges; the end of so-called "free banking" for those whose accounts stay in credit.
"It may be that some banks may charge some customers an annual fee," said Mr Elithorne.
But he pointed out that in contrast to the fees earned from charging for overdrafts, a standard charge of £300 a year, applied to the country's 75 million current accounts, would generate an extra £20bn or so in income for the banks. "I believe that if the banks tried to extend such charges much more broadly that some other banks would continue to compete quite vigorously to keep free banking," said Mr Elithorne.

[ohoh4312]

Hello you

Well, shabbeys new "service charges" came into effect yesterday, ahead of lloyds, so they are not the first - shabbey thumb to nose at the now one-legged black horse. Whatever!!!

However, I digress;

The Office of Fair Trading (OFT) could drop next year's High Court test case over bank overdraft charges, a senior official has said.

But the OFT added it would only do this if the banks put forward an agreeable compromise and if such a deal was in the best interests of customers.

By revising their T & C's to a sliding scale of service charges - an agreeable compromise? - is that not a smug reply to an obvious white surrender flag from the OFT???

And if they indeed drop the case, where the hell does that leave the thousands of court claims currently in limbo?

This has always smelled (or is it smelt?) dodgy from the start, and now it positively stinks!

I for one will be arguing my case on the T&C's in force for the duration of my claim, NOT "the new hastily rewritten ones by a team of lawyers specifically employed to dig them out of a hole."

Furthermore I shall argue that as the OFT (may) have failed to bring a judgement on the fairness or otherwise of unauthorised o/d charges, I, as a consumer, still have the right to challenge said charges, which were imposed under the "historical" punitive tariff.


Oooooops fell off my soapbox!!

Sorry, but I am SOOO aggrieved with the whole situation. Excuse me for ranting on your thread, but hopefully you can then tell me if I am right on my argument, or if I need medication!!

Lotsa luv

Jo xx

[Lula]

Hi Jo, yes you are in need of medication but then again I heartily concurr, these are still unlawful penalties and as such, if the OFT wont stand up for the consumer (Always thought they were a toothless tiger much like the Information Commissioners Office) then we MUST continue to haul their sorry asses through the court and try and force their true charges out of them.

High up here on this soapbox isnt it

[srfrench]

Hear hear..... and standing on Jo's and Lula's shoulders

If they do revise their T&C's to a much lower level, then I'm all for it. If the OFT drop their investigation, I'm all for it. Stays would have to be lifted and the mass litigation starts up afresh. How they expect that T&C's imposed in the last few days have any relevance to claims up to 6 years ago AND beyond is legally beyond anyone's common sense and legal training!

Let them do the deal....... I'm chomping at my bit here

[srfrench]

PS........ No you are spot on Jo.


Lets wait and see what happens LOL

[Lula]

Well gerroff my shoulders, no wonder they hurt this morning

[srfrench]

Typical woman............ you were the one who wanted to try some new kinky stuff lol

[Lula]

shhhhhhhhhhhh dont tell Everyone lol

[srfrench]

Whooooops!

[srfrench]

Ooooo I love this imposed Stay on Claims.

Mine is now just pennies short of accrueing £20 PER DAY interest!!

Roll on any "deal".

[Lula]

only as long as they agree to a deal for £1.5o or less!