[Sussex] Bank charges, important court case

[John D.]

On Saturday 07 April 2007 10:21, Andy Smith wrote:
> On Sat, Apr 07, 2007 at 08:43:14AM +0100, Andrew Guard wrote:
> > The barrister Tom Brennan believes bank penalty charges are illegal
> > and he try to get "exemplary damages". plus full refund. And the bank
> > has no choice but to defend this action.
>
> This sort of thing makes me quite uncomfortable.  I was a student
> once.  I was terrible with money.  I always went over my overdraft
> limit and got charged stupid amounts for it.  I wasn't much better
> in the first few years of work after uni either.  Is that the bank's
> fault?  I believe it was my fault and no one is to blame but me; I
> would not dream of trying to claim any of it back.
>
> After a few years ago being made redundant and spending some time
> without work, not in poverty but really having to count my pennies
> like never before if I wanted anything above the bare minimum in
> life, well, that taught me to be more sensible with money.
>
> I know there are lots of people really struggling and them being hit
> with bank charges that mean they can never clear their debts is just
> wrong, but it's hard to believe that this guy is or was one of them.
>
> The article says he ran up £2,500 of charges on an unauthorised
> overdraft.  I'm sure that did not happen overnight, so why did he
> not speak to the bank and tell them he had no way of clearing it?
> At which point I would hope they would close his account and he
> could have gone through a process to repay over time, and operate a
> reduced facilities account (i.e. no overdraft facility) in the
> meantime.  If you ignore things then yes the charges mount up.
>
> Of course we don't know the full story and maybe he did speak to
> them, I don't know.  I just worry that somewhere along the line
> personal responsibility is going out of the window.  If he wins this
> case then banks will not dare to apply charges in case someone else
> says they are unfair.  What then will they do?  Make it very hard to
> get overdrafts?  Close accounts as soon as they start attracting
> charges?
This is the kind of thing that I don't like, because the likes of the banks 
always try for "self regulation", and then manipulate it in their own 
favour - I know that some moan, but I prefer legislation to 
self-regulated "things".

Additionally, bank charges are, according to the (surprise surprise) "banking 
code of practice", only supposed to cover their costs (using the example of 
exceeding an overdraft facility), but not penalise the transgressor. It does 
IMO appear that they are applying penalties - which is probably the 
barristers' stand point. Or is it, that he knows stuff that we are unaware of 
and "smells a profit" ???

regards

John D.