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Leading Consumer Rights organisation demands modification of Bank Charges Waiver

Press release March 1, 2009 Business

A Consumer Action Group spokesman speaking on BBC Radio 4's MoneyBox programme, called for a modification of the FSA waiver, which has allowed all UK banks to suspend dealing with the claims for the return of unlawfully seized bank charges.

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Marc Gander, cofounder of the Consumer Action Group, said that the FSA waiver should now be modified to prevent banks from taking legal action, and entering credit register defaults, against customers who were unable to pay the charges which banks are continuing to levy.

The Consumer Action Groupcall for the waiver to be modified comes in the light of last week's Court of Appeal decision, which unanimously upheld the decision of the High Court that bank charges for exceeding overdrafts limits and bouncing cheques could be subject to an assessment for fairness by the OFT.

The call for modification was made came during a discussion at which Ian Pollock, BBC business correspondent, and Angela Knight, chief executive of the British Bankers' Association were present.

Since July 2007, UK banks have been released from their normal obligation to investigate bank charge complaints within eight weeks. Instead, all such complaints have been put on hold pending the final outcome of the OFT litigation against eight UK banks.  In response to their defeat in the Court of Appeal last week the banks announced that they would now appeal to the House of Lords.  It is expected that this further step could take the suspension of customer complaints well into 2010.

Mr Gander pointed out that although half a million bank customers were currently being prevented from recovering their bank charges, for the banks it was business as usual and that not only were they continuing to levy charges but they were continuing to apply enforcement procedures and using the credit reference system to enter defaults against those customers who were either unwilling or unable to pay the banks' very high level of charges.

He went on to say that it is extremely unfair and unjust for banks to continue such punitive and damaging action against ordinary people when four senior judges have now concluded that the issue of whether the charges are unfair can be assessed by the OFT.

The OFT has already indicated a preliminary view that the present level of bank charges is unfair.

Angela Knight claimed that the banks were already helping their customers, for instance by agreeing to process refund claims where the customer was suffering from hardship, but Marc Gander responded that this was clearly not the case. 

The Consumer Action Group website has over 210,000 members, and there are many hundreds of cases in which people were clearly suffering from great hardship.  The Hardship Guidelines are not clearly defined, and it is only in very exceptional circumstances when a bank agrees to process a claim. In any event this does nothing to solve the grave injustice caused by a negative credit file entry for a bank charges-related debt.

Consumer Action Group.

1st March 2009

Notes to Editor

The Consumer Action Group is a free-to-use, non-profit making, Internet based consumer rights group, which is leading the present campaign against unlawful bank charges. The organisation was formed on 10th January 2006, and is the earliest of the Internet "bank charges" campaign groups.

The Consumer Action Group now has over 212,000 members and that number is increasing at a rate of 1000 per week.

The Consumer Action Group is run by volunteers, and even the owners of the group receive no remuneration.

Our members have recovered over £18 millions (estimated) in bank charges from UK high Street banks.

Our style, our approach and our templates have set the pattern for many other "bank charges" campaigns including Which? (the Consumers Association), Martin Lewis' and

Marc Gander can be reached by email ([email protected]) or by telephone on: 020 8180 5205