|
Independent Banking Advisory Service |
|
Personal customers need not pay anything to obtain their bank penalty fees back. Penalty charges by banks? There is plenty of DIY help available for Bank customers and Penalty charges, in this one very specific area where Consumer Contract law is relied upon to attack clearly unfair and unreasonable penalties. The overdraft and card penalties have been levied by banks profiteering from personal account customers. Business Banking account overcharges are different and need to be contested in a different way. IBAS offer membership to cover the work involved in a) proving a business bank overcharge and b) the work involved in reclaiming the bank overcharge once proven. The benefits of the consumer rebellion against bank penalty charges is that personal bank penalty charges are now being examined by the OFT - but in our opinion the OFT should have done so much earlier. IBAS applaud the efforts of those who initially gathered necessary information, like Richard Colbey, a barrister who writes for the Guardian. His article dated 25th September 2004 was initiating consumer action and drew attention to the lack of action by either CAB which had statutory powers available to them, or Which? Richard Colbey also provided the case law information and the fact, on which the whole consumer rebellion against penalty charges was founded. Several Guardian articles provided his legal opinion - which stated that consumer penalty fees charged by banks were not legally enforceable under existing case law. This work has enabled Stephen Hone at his Penalty Charges website to obtain a £5m ‘claim back’ success so far, to become another leader of the consumer rebellion - fighting his own legal case for penalty charge refunds and getting his claim paid. He and his website assist others to win back personal account penalty charge refunds - without any charge. With regard to the growth of large numbers of ‘no win - no fee’ operators who are keen to make money - Over the years IBAS has seen many of these operate for a short time and then disappear. What happens to customer’s bank information when that happens? We would worry about that, if we were those customers. It seems clear to us, that where companies are trading and offering to obtain business bank refunds, unless you have a method for not doing the ‘up front’ and essential work (without actually paying anyone for it to be done) and which is required for a full investigation and audit of business account bank overcharging, what you have is an immediate overtrading situation. Overtrading - in simple terms this means there is just too much work with not enough money in the business to deal with it. It is often associated with Small Business ‘start ups’ where the first priority is obtaining customers – so a 'busy' business can easily run out of money, often with a full order book, as they cannot fund the work. One company, having advertised for ‘no win - no fee’ bank overcharge cases went bust, owing its creditors many thousands of pounds. Lots of people had seen the adverts and sent bank overcharging cases, without any payment for doing any of the work. It wasn’t a company ‘built’ on a ‘shoestring’ - but that company soon found they were losing money very quickly indeed – with little money coming back in. They just couldn’t deal with the volume of ‘free’ cases – simply because, much of the work required an ‘up front’ commitment from the company, with obvious costs. Banks are not noted for quick responses, particularly when they are being asked to repay on overcharging and are also dealing with ‘no win – no fee’ companies. It is in a bank’s interest to delay when dealing with such claims - particularly, if they know that the company has it's own cash flow problem. The moral: Any company can go ‘bust’ providing 'something for nothing' - The old adage that ‘if something looks to good to be true it usually is’ still applies.
When IBAS has been requested to review overcharges claimed on company bank overcharge claims by ‘no win - no fee’ operators, nearly all cases had no audit calculations and bank overcharge refunds were well below the original alleged ‘overcharge’ - substantially so, once ‘success fees’ had been taken by the firm concerned. The possibility also exists that some ‘no win - no fee’ operators may not carry out any bank account auditing calculations but use the customer’s figures without verification or calculation, to support the claim - but then seek a high percentage 'success' fee from any banking refund obtained - If that is the case then these ‘operators’ are simply ‘scamming’ or ‘conning’ their customer for their very high ‘success’ fees – 5th November 2007
|