Reclaim Bank Charges - Do You Have The Right?

You have failed dismally, to manage your funds. Your bank has offered you money, which you have taken. You have not however, kept enough of that money to pay your direct debits or cheques. There isnt even enough to cover the charges you have received. Why should you be allowed to reclaim those charges? Why should you receive any refund? Your bank account, your problem. Deal with it! Why blame someone else?

To a certain extent, you are the one whos at fault. You, like so many other people have spent the money made available to you. But that is the point. Everybody does it. Years ago it would be extremely difficult to get your bank to lend you even the smallest amount of money. Banks simply wouldnt let you spend money that you didnt have. Modern banking sees offer after offer though, thrown at people. Offers openly inviting people to live beyond their means. The repercussions can be crippling, and the amount the banks charge just doesnt seem fair. Here there is an important point:


Penalty clauses are not allowed, according to English law. If a bank cannot justify charging you 25 - 40 for sending out an automated letter, informing you of an unauthorised overdraft, then such a fee is considered a penalty.

Inflated fees for overdrafts, the return of cheques, And direct debits and standing orders that have not been paid, are all potentially a breach in the law.

What can be done? It is free to claim the money back. First and foremost, a list of charges needs to be requested from your bank. A standard letter is then sent to the bank, requesting to be refunded for these charges. Occasionally people reseave cheques, but usually they receive a letter of refusal. The next step is to draft a second letter, stating that court action will be sanctioned, should they not refund you within a certain time constraint. They may refuse again. But a court of law is unlikely to work in the banks favour. The bank needs to prove that the charges against you were not penalties. At any stage, the bank may contact you, offering a negotiable settlement fee.

If you dont want to get your hands dirty doing this type of thing, or do not have the time, then there are companies that will do this for you on a no win no fee basis. They work on a commission basis, which is usually around the 25% mark. This fee also includes court costs. These cases very rarely go to court, so this needs to be considered.

A no win no fee basis is offered by certain companies. It is merely a case of shopping around. The greatest benefit of this is that you only pay, up until the time that you get your money back. Also, the company is more likely to maintain a healthy relationship with your bank, as it is not necessarily in the companys interest to go to court.

If you feel it is in your interest to claim back your bank charges, then you should act quickly. It is rumoured that OFT (the Office of Fair Trading) are soon to set an acceptable level for the banks to charge. Once such parameters are set, it is likely that banks will seriously limit the amount awarded. If The ruling is set at 12 then the impact on claims is likely to be huge.

By: Jonathan Walker - Big Blue Tomato

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This article is written by Jonathan L Walker, on behalf of Claims Management UK, specialising in helping people to Reclaim Bank Charges