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The overdraft review fees are incorproated into the T&C's as being payable in respect of the contract being breached. The law regarding penalties would therefore apply to them. If the bank claims it was providing you with a further service when you exceeded your overdraft limit, then it cannot establish any entitlement to the charges it levied. Charges for providing further credit under an exisiting credit agreement could only be levied if they were incorporated into the overdraft agreement (in writing) prior to the agreement being concluded. This is the requirement of the OFT in its determination promulgated under the Consumer Credit Act 1974 and is the law regarding the proper execution of overdraft agreements. The overdraft review, card misuse and unpaid fees were all incorporated into the agreement as being payable in respect of the contract being breached and, not varied. All this is not really not relevant as all you need to do is send off you letter claiming back ALL the charges and to start a court claim if this becomes neccessary. Good luck in getting your money back.

Hi Ruth, The 'Total Charges' on your statement is in reference to the amount of Overdraft review fees (£25 each upto a max of £125 a month) which will be levied from your next statement. They are levied in addition to the card misuse and unpaid fees. The bank is not legally entitled to claim the actual costs (if any) it incurred on the occasions it levied the charges, and it would not do so anyway. I would advise you to start the ball rolling and write to the bank's head office customer complaints. There are template letters in the library, also here is a link to a copy of the letter I used to get my £700 back from HSBC if you want to use it: http://www.bankactiongroup.co.uk/forum/viewtopic.php?t=1213 Good luck with your claim and I would advice you to pursue the full amount owed to you - start a court claim if you have to and dont settle for any partial offer they may make to you.

Hi Dimitri, I dont think you can take any action against the loan as it is a seperate credit agreement for an amount equivalent to the amount of your overdraft at the time you contacted HSBC regarding the money they were demanding from you, or that you were having difficulty in paying. HSBC did not require, or force you to enter into that agreement, it was provided to you as a means to consolidate your overdraft by repaying it as a loan at the agreed APR. Also the amount of your overdraft at the time the loan was taken out could not, I assume include all the £634 in charges you incurred since 2003. The interest on the loan you have paid and continue to pay is something you agreed to pay for the loan itself. I was in a similiar position to you and I wrote to the Head Office Customer complaints regarding £700 in charges which they refunded within 21 days. They used that amount to reduce my loan with them but they then refunded it into my current account after I disputed this. If they try and do the same thing to you, and you dont want the money to be used to reduce your loan then I would challenge it as it is unlawful for them to impose this condition onto you. The loan is a credit agreement and so long as you are not in default you do not have to repay more than the amount that was agreed to be repaid each month. If they claim that they are entitled to use the refund of charges to reduce the loan because they are simply putting the account back into the position it would have been had the charges not been applied, then remind them that this would be an admission that the charges should not have been levied and that they had no entitlement to them. If they were making a commercial settlement - paying you the money as a gesture of goodwill or to avoid court action, then they are not correcting the account, they are paying an amount of money sufficient to settle the complaint you made. I dont think you will have to go to court - HSBC cannot establish any lawful entitlement to the charges, but you may have to start a court claim to get them to pay up. Good luck with this, I am sure you wil get all of your money back. Please keep everyone updated on your progress and here is a link to court guidance on claiming interest: http://www.hmcourts-service.gov.uk/infoabout/claims/howclaim/interest.htm I think there is a spreadsheet program on this board that you can use to calculate the interest. For anyone who might want use it I have pasted a copy of the initial letter before action I sent to HSBC. I think it is best to avoid using the online complaints procedure or your local branch as you are likely to just get a standard response referring you onto the Head Office address if you are not satisfied. 09 January 2006 The Manager - Customer Relations Department HSBC Bank plc Level 40 8 Canada Square London E14 5HQ Dear Sir or Madam Re: Overdraft, Card misuse and Unpaid item charges (‘the charges’) Current Account XX-XX-XX XXXXXXXX Between 30/06/05 and 07/11/05 you levied a total of £700 in ‘card misuse’, ‘unpaid item’ and ‘overdraft fee’ from my account. I have detailed the charges on the attached schedule. I am writing because I believe the charges amount to a financial penalty and are therefore legally unenforceable. I will take action through the county court to recover them if they are not repaid within the next 21 days. Your terms and conditions and the related correspondence make very clear that the charges are levied in respect of the contract being breached. Rather than being liquidated damages designed to compensate you for any actual loss, these charges are designed to penalise myself for a breach of contract and to generate profit. The law regarding penalties is well established and clear and in particular I refer you to the case of Dunlop Pneumatic Tyre Co. Ltd. v. New Garage and Motor Co. Ltd. (1915). Further, any terms purporting to entitle you to levy these disproportionately high charges from my account would appear to be contrary to the Unfair Terms in Consumer Contracts Regulations 1999 (SI. 1999/2083) and as such void. My account falls within the ambit of Regulation 5 as I am a consumer. The charges constitute an unfair penalty under reference to paragraph 1(e) of schedule 2 of the said regulations: ‘Indicative and non-exhaustive list of terms which may be regarded as unfair - 1. Terms which have the object or effect of – (e) requiring any consumer who fails his obligation to pay a disproportionately high sum in compensation’. On 26 July 2005 the Office of Fair Trading stated that 'a charge is likely to be disproportionately high if it is more than a court would be likely to award if the lender sued the cardholder for breach of contract'. Your charges do not reflect any actual or real loss, instead they appear to represent a lucrative profit-making scheme. If I do not receive payment of £700 by 30/01/06 I will start action through the county court to recover this amount plus costs and interest pursuant to s69 of the County Courts Act 1984. Yours faithfully Paul Carson

Hi, What is your £1100 in charges made up of? Does it include card misuse charges?

Hi all, I thought I would post details of my victory against HSBC for charges amounting to £700 levied from my current account, which they have now repaid without me having to start court action. I wrote to them in January giving them 21 days to refund the charges to my current account. They acknowledged the complaint and undertook to provide a full response by the expiry of my letter before action. At the end of the 21 days they wrote to me again saying they would need an extra 10 working days to provide a full response. I phoned them to ask why they needed the extra time as they had already undertaken to provide a full response within the time limit. They put me on hold and came back to me saying a reply was going out to me in the post. A few hours later I checked my balance and the charges had been refunded. However, they then took the amount of the refunded charges out of my current account and used them to reduce my loan account, which was not in default and never had been. They stated that it was a condition of refunding the charges that the money was used for this purpose. I phoned several times to dispute this and they refused to allow me to be put through to them or to discuss the matter with a manager. I had to write in to complain and they, with some reluctance put the money back into my current account. In a matter of weeks I got back the full amount of my charges by simply writing to them and without having to start court action. It is clear HSBC know they cannot defend these charges in court and I hope other people claiming against HSBC will also receive swift settlements to their claims. HSBC's overdraft charges can only be payable in respect of the contract being breached, this is made very clear in their automated correspondance and within the T&C's. It would be very difficult for them to establish to a court that the contract was not breached and that they were provding a service. If they were able to do this, they would be unable to establish any entitlement to the charges they levied, because these charges were, and could only have been incorporated into the agreement as being payable in respect of the contract being breached and not varied. Additionally, if charges such as charges such as the Card misuse fee (which are levied in addition to the Overdraft fee) were tested in the courts they could only be found to be entirely punitive and therefore unlawful. The matter as to whether they a were genuine pre-estimate of loss does not even apply to them. The Financial Services Authority requires HSBC to adequately respond to complaints made to it by its customers: http://fsahandbook.info/FSA/html/handbook/DISP If you state in your complaint that the charges were payable in respect of the contract being breached and that they are punitive and unlawful they would have to fully address this matter in their final written response to you and clarify their position regarding the charges, unless they respond to the complaint by refunding the charges as a gesture of good will, which would settle the complaint and probably removes their obligation to provide a more clear written response. If they refuse to refund the charges and you get a vague and ambiguous response from them, which does not fully state their position regarding the legality of the charges they have levied from you, I would pursue them for a full final written response. They would have to provide you with one which clarifies in writing matters such the charges being payable only in respect of the contract being breached and the Card misuse fee being entirely punitive. This final written response would be legally binding upon them, and it would be very difficult for them to establish in writing any clear legal grounds to have levied the charges from your account. Good luck with your claims Paul Carson

Hi all, I thought I would post details of my victory against HSBC for charges amounting to £700 levied from my current account, which they have now repaid without me having to start court action. I wrote to them in January giving them 21 days to refund the charges to my current account. They acknowledged the complaint and undertook to provide a full response by the expiry of my letter before action. At the end of the 21 days they wrote to me again saying they would need an extra 10 working days to provide a full response. I phoned them to ask why they needed the extra time as they had already undertaken to provide a full response within the time limit. They put me on hold and came back to me saying a reply was going out to me in the post. A few hours later I checked my balance and the charges had been refunded. However, they then took the amount of the refunded charges out of my current account and used them to reduce my loan account, which was not in default and never had been. They stated that it was a condition of refunding the charges that the money was used for this purpose. I phoned several times to dispute this and they refused to allow me to be put through to them or to discuss the matter with a manager. I had to write in to complain and they, with some reluctance put the money back into my current account. In a matter of weeks I got back the full amount of my charges by simply writing to them and without having to start court action. It is clear HSBC know they cannot defend these charges in court and I hope other people claiming against HSBC will also receive swift settlements to their claims. HSBC's overdraft charges can only be payable in respect of the contract being breached, this is made very clear in their automated correspondance and within the T&C's. It would be very difficult for them to establish to a court that the contract was not breached and that they were provding a service. If they were able to do this, they would be unable to establish any entitlement to the charges they levied, because these charges were, and could only have been incorporated into the agreement as being payable in respect of the contract being breached and not varied. Additionally, if charges such as charges such as the Card misuse fee (which are levied in addition to the Overdraft fee) were tested in the courts they could only be found to be entirely punitive and therefore unlawful. The matter as to whether they a were genuine pre-estimate of loss does not even apply to them. The Financial Services Authority requires HSBC to adequately respond to complaints made to it by its customers: http://fsahandbook.info/FSA/html/handbook/DISP If you state in your complaint that the charges were payable in respect of the contract being breached and that they are punitive and unlawful they would have to fully address this matter in their final written response to you and clarify their position regarding the charges, unless they respond to the complaint by refunding the charges as a gesture of good will, which would settle the complaint and probably removes their obligation to provide a more clear written response. If they refuse to refund the charges and you get a vague and ambiguous response from them, which does not fully state their position regarding the legality of the charges they have levied from you, I would pursue them for a full final written response. They would have to provide you with one which clarifies in writing matters such the charges being payable only in respect of the contract being breached and the Card misuse fee being entirely punitive. This final written response would be legally binding upon them, and it would be very difficult for them to establish in writing any clear legal grounds to have levied the charges from your account. Good luck with your claims Paul Carson