ONE-MAN CRUSADE

Bob Egerton is on a one-man crusade against banks and has recouped thousands for customers wrongly charged on their accounts. He has had 100% success in getting the banks to pay back the money since he began his free service 18 months ago. He has won a total of £10,000 from banks, all of it going back to the customers. Bob says banks make millions from charging customers for making mistakes in their accounts but are “spineless” when threatened with legal action.

Bob has taken on the banks over charges made when people go overdrawn and cheques bounce. So far he has won back a total of £10,000 repayments for customers of institutions including Abbey, Alliance and Leicester, Capital One, Nationwide and Yorkshire Bank. Bob, a former teacher who lives near Truro, Cornwall, got a law diploma at Plymouth University in 1996.

He said, “There is a conspiracy between the banks. They know they can make billions of pounds but won’t step inside a courtroom because they know they will lose. Banks will publicly state charges are lawful. They say customers have agreed to the charges and that nothing can be done about it but the moment the claim gets into court the banks have a very different attitude. They are not prepared to stand up in a public forum and present their case. They always settle before it goes to court.”

Since he began his free service for debtors in need, Bob has taken on seven cases and received a payout in each one. He said the Consumer Contracts Regulations of 1999 and common law do not allow one party in a contract to penalise the other just to make money.

He added, “The Office of Fair Trading has been trying to look at the problem but it is clearly under political pressure because the Government is scared of the banks. They need the business because of their political agenda. It’s an absolute scandal.” A spokesman for Alliance and Leicester said, “Basically the situation is that we can’t get involved in defending these cases because it is not worth our while doing it. It’s not in any way because the charges are unlawful.”

Bob's score has risen from played 7, won 7 to played 20, won 20. For further information, take a look at his new website at www.bankbuster.co.uk - it provides advice and guidance on how to reclaim charges, with templates for letters, forms etc. Plus the "Bankers' Hall of Shame" giving details of all the cases that he has won. Bob, an organiser for the Lib Dems, can be contacted at the website: www.bankchargeshell.co.uk (Source: The Sun, Jul/06)

Millions of bank customers hoping to be refunded “unfair” bank overdraft charges were left disappointed as the Supreme Court ruled in favour of the banks. Seven high street banks and a building society have won the right to charge customers who use unauthorised overdrafts. The banks were appealing against an earlier ruling that charges for the overdrafts come under “unfair contract” rules and are therefore subject to regulation by the Office of Fair Trading (OFT).

But the Supreme Court accepted the banks’ argument that free banking on current accounts was only made possible by charging customers who went into an unarranged overdraft. The decision will come as a major blow to millions of customers whose refund claims may now be thrown out. Customers who go into unauthorised overdraft can be charged as much as £35 or more for a single bounced payment but campaigners claim the actual cost to the banks could be as little as £2.50.

Consumer group Which?, which led a campaign encouraging people to reclaim the charges, called the ruling a "bitter blow". Which? chief executive Peter Vicary-Smith said, “This is a bitter blow for the millions of people who have been patiently waiting to get their bank charges back. Not only does it give banks licence to charge what they like for unauthorised overdrafts, but it could have ramifications for other areas of personal finance. The banks now have no excuse for introducing other fee charges.”

The test case to decide the legal issues thrown up by the dispute was brought jointly by the OFT and Abbey, Barclays, Clydesdale, Halifax Bank of Scotland and Lloyds TSB, which are now part of the same group, HSBC, Royal Bank of Scotland Group and Nationwide Building Society. If they had lost the appeal, it would have paved the way for further hearings to establish whether the charges are fair and, if not, what a fair charge would be.

It was estimated that up to eight million people may have paid unauthorised overdraft charges since July 2001, but have not yet submitted a claim to get their money back. If the banks had lost the test case at the Supreme Court, it would have cost them £2.6 billion a year in lost revenue and could have led to their having to make refunds of up to £1 billion. Before refund claims were frozen, some banks had already paid out more than £559 million to customers who complained about “rip-off” overdraft charges.

Lord Phillips, President of the Supreme Court, said the charges were agreed by customers when they took out an account with the banks. He said that without the charges, the banks would not be able profitably to provide current account services without a fee. Lady Hale, giving her ruling, said, “The banks may not be the most popular institutions in the country at present, but that does not mean that their methods of charging for retail banking services are necessarily unfair when viewed as a whole.”

The British Bankers’ Association said, “The Supreme Court has confirmed that the banks’ unarranged overdraft charges are an important part of current account services which the banks provide to their customers and that the amount of those charges is not assessable for fairness. We recognise this issue has been of real concern to a large number of our customers and we are pleased that this decision now brings clarity for all parties. The banks will continue to work together with the OFT in connection with its on-going market study.”

For the Government, Sarah McCarthy Fry, Exchequer Secretary to the Treasury, said, “Consumers, who have been waiting a number of years, will be extremely disappointed with this outcome. It’s clear that in the past, banks were not thinking enough about their customers. That needs to change for the future. While the decision on past charges has not gone in favour of consumers, we are determined to ensure the system is made fairer in the future. The Government will work with the OFT and Financial Services Authority to reach a new framework for fairer bank charges going forward.” (Source:Daily Express, Nov/09)

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