Thankyou people, and quick responses too!
That has confirmed what I was thinking, but didn't want it to adversely affect any claim in the courts.
I'll keep this thread updated with any progress, am just putting all my details into the second letter ready to send off on the 30th.
In the letter it says that someone will contact me. If they try to phone, what should I say to them? My line would be that I believe the charges are illegal, and that I expect them to be refunded. Is there anything I shouldn't say? Also if they do call (unlikely I would think) I will note down time and date, and everything that is said.
Once again thanks for the advice people, and here's looking for a happy outcome for everyone.
Edited to add:
This is the text of the letter I intend to send. I had to edit the template a little as it didn't quite fit my situation. What do you think? Have I said all the right things?
LETTER BEFORE ACTION
Dear Mr Xxx,
ACCOUNT NUMBER: XXXXXXXX
I am very disappointed that you have failed to respond adequately and in a timely manner to my letter of the 15th May 2007.
I now understand that the regime of 'fees' which you have been applying to my account in relation to direct debit refusals, exceeding overdraft limits and so forth are unlawful at Common Law, Statute and recent Consumer regulations.
I would draw your attention to the terms of the contract which you agreed to at the time that I opened my account. It is an implied term of that contract that you would conduct yourselves lawfully and in a manner which complies with UK law.
I am frankly shocked that you have operated my account in this way as I had always reposed confidence in your integrity and expertise as my fiduciary.
I calculate that you have unlawfully taken £725 and am furthermore claiming statutory interest on these charges, as will be awarded by the court, of £81.64. giving a total owing of £806.64.
I am enclosing a copy of the schedule of the charges which I am claiming. I have already sent you a copy of this in my original letter of the 15th May 2007.
I require repayment in full of this money. If you do not comply fully within 14 days then I shall begin a claim against you for the full amount plus my costs without further notice.
Furthermore, I shall submit a Consumer Credit Act 1974 complaint to the OFT upon the basis that you have failed to comply with the OFT's direction of 5 April 2006 and are therefore not a 'fit and proper person' to hold a consumer credit licence under the 1974 Act. If you do not understand what this means then seek advice from your legal department.