[Mr Angry]

Originally Posted by Chrysalis

Then you are disagreeing with the bbc and the consumer action group site, not saying you are wrong just saying that they are saying that penalty charges are not allowed to xceed the cost of admisitrating the charge, which means in affect you can do a penalty fee but it has to be in line with costs.

Considering they reduced credit card fees to £12 this backs that up.

If fees are illegal full stop then why were the credit card fees reduced instead of removed.

Why did the bbc goto the trouble to do an experiment on how much it costs to bounce a cheque when its not even relevant?

I am not disagreeing with anyone, I'm simply stating a fact. "Administrative charges" are "administrative charges" up to the point that they exceed the "administrative costs" whereby they become a "penalty charge".

With all due respect we've been round the houses on this one. The OFT gave it's opinion on cc charges, not the definitive law on same. Had the OFT said it considered the threshold of £6.00 to be fair then the banks would have reduced it to £6.00 . Again I refer you to my quote from the OFT ""....and a court will certainly not consider that a default fee is fair just because it is below the (our suggested) threshold (of £12.00).”

There is a very real difference between the opinion of a Government body and the law - which is why John Fingleton worded his statement in that fashion.

As for the cheques - they are one of the few processes left in banking which require "human intervention" which is quantifiable as an administrative cost.