Originally Posted by lostandconfused

Good morning all,

would just like to give a breif update on my ongoing saga with the halifax.

I was going through my online banking a few days ago and realised i'd made a bit of a mistake in my orginal letter, i put in a complaint for just over £200 worth of bank charges, but actually the amount was just over £800.

anyway it was late so i left it, so i could deal with it in the new year as i really didnt want to be onto the bank and waste my holidays.

So this morning i get a letter from the nice but ever so slightly patronising man from customer relations. From the beginning it doesnt look good, explaining how they inccur charges because of me etc etc and how its my responsibility and so on.

Then to my surprise at the bottom of the letter in the very last paragraph it says as a gesture of good will i would like to offer you a refund of £840. as im sure you can imagine as soon as i regained conciousness i was over the moon!

Im even tempted to drive to leeds and hand deliver the acceptance form.

As a side not i just realised as i was typing this that I have already had one of the charges removed before as I wasn't happy for being charged £20 for going overdrawn my pennies for a few hours, so they have refunded that charge to me twice now!

Finally would just like to thank everyone that has helped in this saga, I would have definatley given up long ago otherwise.
And for everyone that is thinking its not worth the hassle like i did, it cost me the time to write two letters and asking some advice on here, i think its worth it.

Originally Posted by SMHarman

The fee is not illegal per-say, but if all they have done in the first instance is print some extra text on your next month bill reminding you that your account is 30 days overdue then how much has this cost. It has not cost more paper, it has not cost more postage, all it has cost is the programming development time to add and thest that if / then loop to the statement rendering application.

If they are sending out additional reminder letters then there are directly calculable production costs, of paper envelopes, toner postage, but this is probably printed on surplus statement rendering capacity so is there a cost of buying more printing and distribution capabilitlity that they can allocate as a fixed cost - probably not, but there are the staff and cost per unit maintainance.

Then there is the team of bodies that call up etc, that probably costs more money and can directly be attributed to late payers, but they do not kick in on day one, probably nearer day 60.

I would see the 30 day late fee dropping considerably, along with the interest rate on the card escalation (common in the US) as you are now considered a higher risk. So they will claw back the loss of the 'penalty fee' by increasing your interest charge (and you can bet that increase will be more).

I can also see that as the account becomes more delinquent, the fees will increase as the bank can justify that now the letters and the call center is calling the account holder.

My

Originally Posted by Mr Angry

I'm sorry but I genuinely cannot fathom any logic from what you are asking. You need to revisit the OFT statement of April this year (see the quote / excerpt below). John Fingleton put it on the line to the banks last night when he advised them, and their mealy mouthed Trade Association spokeswoman, "We are prepared to litigate on this matter".



I'm sorry but you are mistaken.

Penalty charges in consumer contracts are illegal - full stop. Liquidated losses (or pre-estimates of the costs involved in addressing a breach of contract) such as those to which you refer are legal as long as they only represent the actual costs incurred. There is a very distinct difference.

Given that not one bank in the UK is prepared to either have their cost structure analyzed or justified in a court of law then it is entirely safe to conclude, as evidenced on the TV last night, that they are penalty charges levied in respect of a contract breach.

That is why the BBC go to the bother of making documentaries, why the banks have never defended a single claim in court and why the OFT couched it's words when saying "....and a court will certainly not consider that a default fee is fair just because it is below the threshold.”

It helps the consumers case, somewhat, when companies shoot themselves in the foot by declaring something to be a "late payment fee". Quite how they might hope to assert that this represents anything other than a penalty charge is beyond me - and the best financial legal minds in the British isles.

I've said it before and I'll say it again. People need to stop believing the mantra of "banks and companies wouldn't do things like this if they weren't legal". Last night's programme showed, quite succinctly, that they do and will continue to do so unless enough people assert their rights.

The banks cannot, reasonably, expect people to believe that they, armed with teams of lawyers, are shying away from court confrontations and refunding monies out of the goodness of their hearts. Kieron from Matrix Chambers hit the nail on the head when he said he does not believe that they can defend their cost structures in court as reasonable administrative charges. They have been caught stealing money from people and there are those who are minded to ensure that justice is done as we would expect in any such similar criminal case of theft.

They've been stealing money and people are getting / claiming it back. Fact.

Originally Posted by Marge

I've just had a letter today from British Gas advising that they too are introducing a late penalty fee for customers