Halifax unauthorised overdraft charges

[SB100]

Halifax are charging £5 a day for being overdrawn - irrespective of how much you are overdrawn.

 

Is this lawful- potentially £155 charges in a 31 day month for being £1 overdrawn?

 

Sorry, to clarify, unauthorised overdraft- even if they allowed it to go overdrwan

[KSmith82]

potentially £155 charges in a 31 day month for being £1 overdrawn?

 

That isn't right. They give you a £10 interest-free and fee-free buffer - so there would be no charge for being £1 overdrawn for a whole 31 days.

 

In any case the maximum they charge in a month for unplanned overdrafts is £100.

[SB100]

That's not what they told me yesterday- it's a straight £5 a day regardless, for unauthorised overdraft. Appreciate the £10 buffer if you say that's the case, so let's use a hypothetical figure of £11- and even if it is capped at £100, that's rather excessive don't you think?

 

That isn't right. They give you a £10 interest-free and fee-free buffer - so there would be no charge for being £1 overdrawn for a whole 31 days.

 

In any case the maximum they charge in a month for unplanned overdrafts is £100.

[SabreSheep]

is this in relation to a problem you are having or just pure speculation?

[AndyOrch]

£10 buffer zone for all customers. A buffer zone zone means if you go overdrawn by up to an agreed amount you don't pay anything. This will now be set to £10 an all Hbos accounts, meaning many people will see their's cut.

 

Interest charges replaced by fees. If you're within your overdraft limit, instead of the current typical 19.5% interest, you'll soon be charged £1 a day if your overdraft balance is £2,500 or less, and double that, £2 a day, if more. These charges will be applied monthly

 

This already applies to the Hbos Reward account but most other Hbos accounts will implement the charging structure in December.

 

Bank charges lowered. If you go beyond your authorised overdraft limit, instead of £35 per transaction plus a £28 fee just for being too far into the red, you'll now pay £5 per day.

 

The changes apply to all accounts, except the student account, where an overdraft facility is available.

[SB100]

Stupidly used the wrong debit card for fuel without realising, Tesco pay at pump.

The wife and I both have accounts with Halifax, cards look v similar, my mistake.

As there was a couple of pounds in the account it cleared the transaction, taking me £60 overdrawn.

As I never use the account, I didn't notice, and hadn't realised until I got a call to tell me about way over £100 of charges added / to be added.

 

Absolutely my fault, not seeking to avoid that at all, it just seems rather harsh to levy charges at that level, so my question was the legality of the charges.

 

Thanks for your help.

[AndyOrch]

Well that's their T&Cs of the overdraft...and the consequences of exceeding.......give them a ring and explain..see if you can get them to allow a one off error and show leniency.

[SB100]

Paid in sufficient to clear o/d balance plus £40 charges for being overdrawn 8 days of April, leaving the account in credit...

 

However, as it was overdrawn in to May they've added another £100 in charges (max permitted, apparently) and are now charging £5 a day.

 

The account has only gone overdrawn because of the application of their charges.

 

Under these circumstances, is the charging of fees caused by their fees lawful?

 

Suspect I'm going to have to suck this one up as well, so for going £60 overdrawn (the account has never been overdrawn before) its cost £170 in charges over a matter of weeks.

 

Hardly seems just

[AndyOrch]

Ditch the account then and make alternative banking arrangement...with no overdraft....let them pile their fees up....and if they try to litigate..defend it for the above reasons.

 

Either that or you can stay on their money making merry go round.

 

Andy

[SabreSheep]

Alternative also

 

steamrolloing charges on charges is unlawful.

 

I would suggest you investigate a BCOBS complaint and take them to the small claims court.

Edited June 10, 2015 by SabreSheep
cross posted, eding post to account

[AndyOrch]

Far better to let them litigate....IMHO.

[KSmith82]

Under these circumstances, is the charging of fees caused by their fees lawful?

 

Yes.

 

The only thing they wouldn't be able to do is file a default notice "if the amount outstanding is solely made up of fees or charges".

 

Hardly seems just

 

As you said, you might just have to suck this one up. If you had gotten in touch sooner they may have been able to do something about your mistake and maybe make a one off gesture of goodwill and stop some of the charges from being applied

 

Or even more ideally, you could have signed up to text alerts in which case you would have known you were overdrawn pretty much as soon as it happened and then you could've transferred some money into the account to cover the shortfall and thereby avoid any charges.

 

...steamrolloing charges on charges is unlawful...

 

Care to back that up with any facts?

[SabreSheep]

Yes.

 

Care to back that up with any facts?

 

Actually yes I can.

 

I will be going out shortly and back in an hour or so.

 

In meantime

 

Look up BCOBS

[KSmith82]

Actually yes I can.

 

I will be going out shortly and back in an hour or so.

 

In meantime

 

Look up BCOBS

 

Well aware of BCOBS, it gets mentioned so often. But thanks anyway.

 

Look forward to it.

[SabreSheep]

Still looking for it, I have seen it somewhere. Either oft or fca ruled on a few of the main banks for issuing default sums due to default sums.

 

 

Obviously you are not aware of BCOBS, or at least not understand it or your approach to financial issues posters have would be different.

 

 

IN meantime although not binding yet, munch on this

 

http://www.moneysavingexpert.com/news/reclaim/2014/09/moneysaver-wins-bank-charges-court-case

[KSmith82]

Still looking for it, I have seen it somewhere. Either oft or fca ruled on a few of the main banks for issuing default sums due to default sums.

 

So is steamrolloing charges on charges unlawful then? Or are you still looking?

 

Obviously you are not aware of BCOBS, or at least not understand it or your approach to financial issues posters have would be different.

 

I disagree, I understand BCOBS perfectly fine.

 

Obviously you're free to disagree aswell but it would be good if you could find a specific example which has led you to think otherwise.

[SabreSheep]

Still looking, but as I work full time and have a bigger list of priorities like actually helping people this is low down.

 

Besides, I linked a case for a start and try reading BCOBS yourself

[SabreSheep]

OK Section 5.1 1A firm must provide a service in relation to a retail banking service which is prompt, efficient and fair to a banking customer

 

 

Imposing Charges ON Charges falls foul here for a start. A Breach of BCOBS is actionable in the county court. AS PER THE LINK i made reference too.

 

5.1.4

Principle 6 requires a firm to pay due regard to the interests of its customers and to treat them fairly. In particular, a firm should deal fairly with a banking customer whom it has reason to believe is in financial difficulty.

 

It would not be hard to argue that the fact charges are steam rolling is a sign that a customer is in financial difficulties and would have reason to believe they were so. EVEN IF the customer themselves failed to declare it.

 

This still is not what I was looking for however, but does go some way. Certainly had the OP decided to litigate this would be one of the avenues open to exploration.

Edited June 11, 2015 by SabreSheep
formatting

[SabreSheep]

http://www.consumeractiongroup.co.uk/forum/content.php?827-Examples-of-unfair-treament

 

 

• Treating bank-imposed charges as unauthorised (Borrowing) - (RBS has already conceded as a "gesture of goodwill" on this BCOBS point)
  
• Levying charges upon charges - (RBS has already conceded as a "gesture of goodwill" on this BCOBS point)
  

[KSmith82]

Still looking, but as I work full time and have a bigger list of priorities like actually helping people this is low down.

 

As I presumed. Great, I work full-time and am on this forum to help people too.

 

Besides, I linked a case for a start and try reading BCOBS yourself

 

You've mis-understood me. I wasn't asking for a specific BCOBS case. I was asking you to find a specific example where my approach to the financial issues of other posters shows that I am not aware of BCOBS or don't understand it.

 

OK Section 5.1 1A firm must provide a service in relation to a retail banking service which is prompt, efficient and fair to a banking customer

 

 

Imposing Charges ON Charges falls foul here for a start.

 

The OP's issue is in respect to an unauthorised overdraft. Overdrafts are not covered by BCOBS. For overdrafts, the relevant legislation includes CONC and the Consumer Credit Act.

 

A Breach of BCOBS is actionable in the county court. AS PER THE LINK i made reference too.

 

That's not quite true. Only certain aspects of BCOBS (e.g. rules NOT guidance) may be actionable by a private individual in a County Court.

 

5.1.4

Principle 6 requires a firm to pay due regard to the interests of its customers and to treat them fairly. In particular, a firm should deal fairly with a banking customer whom it has reason to believe is in financial difficulty.

 

It would not be hard to argue that the fact charges are steam rolling is a sign that a customer is in financial difficulties and would have reason to believe they were so. EVEN IF the customer themselves failed to declare it.

 

This still is not what I was looking for however, but does go some way. Certainly had the OP decided to litigate this would be one of the avenues open to exploration.

 

Yes, Halifax would have to positively deal with customers in financial difficulty.

 

However, that isn't at all relevant to the OP's case as there is no evidence of hardship or financial difficulty. The unauthorised overdraft was caused by a mistake by the OP, not financial difficulty. And he/she has already stated that they might have to just suck it up and pay (suggesting that they do have the means to pay these charges).

 

And in any case, Section 5.1.4 which you are referring to is a piece of guidance NOT a rule (and is therefore unactionable by a private individual in a County Court) so this has no relevance to your original statement about steamrolling charges being unlawful.

 

http://www.consumeractiongroup.co.uk/forum/content.php?827-Examples-of-unfair-treament

 

 

• Treating bank-imposed charges as unauthorised (Borrowing) - (RBS has already conceded as a "gesture of goodwill" on this BCOBS point)
  
• Levying charges upon charges - (RBS has already conceded as a "gesture of goodwill" on this BCOBS point)
  

 

It says gestures of goodwill.

 

That doesn't mean that steamrolling charges is unlawful.