Over the last few months there have been many stories in the press about the reclaiming of bank charges. This followed a ruling by the high court that deemed that the amount banks were charging their customers was disproportionate to the costs incurred by the bank and therefore illegal. This means that because these charges are deemed too high and unlawful, the customer is entitled to the value of the charge back. So for every time you went over draw past your over draft limit, or bounced a direct debit or standing order the bank would have charged you anywhere from £15 up to nearly £40, it is these charges that you are entitled to claim back. People have successfully claimed back anywhere from £100 right up to one lady who successfully claimed back nearly £20,000. The stipulation of the ruling is that you can only claim back charges for a period no longer than the last 6 years.
How do I claim?
The procedure for claiming these charges is simple if not a bit long winded. First you need to establish exactly what you are owed, to do this you need to write to your bank and ask for details of the charges levied against your account for the last 6 years, alternatively you can ask them for your bank statements, there will however be a charge as this request comes under the data protection act. The most legally they can charge you for the information is £10 however, there is no limit on how much they can charge you for supplying complete bank statements, so it is best to avoid this as all you are interested in is the charges. Details of this can be found in “letter 1” all you need to do is fill in the blanks with your relevant information.
Once you receive this information you need to go through and highlight any charges, it is best to list them with the amount, date and page number of the statement where the charge appears and put this on a spread sheet as you will need to send this to the bank. Once you have calculated what they owe you, you can then write the second letter which notifies them of your intention to claim back the charges, “Letter 2”.
What should I do if they refuse?
Although the banks are legally required to return these charges it does not mean to say that they will just roll over and write you a check. Most people who go through this process get back about 85% of what they are owed. This is done as an out of court settlement or good will gesture. You are quite within your rights to expect 100% of the charges back with interest but you may have to submit a claim in the small claims court, (this court is for monetary disputes under £5000), so it does depend how much effort you want to put in and most people would be daunted by the prospect of starting legal proceedings. If you wish to pursue the bank through the small claims court then it is strongly advisable to seek legal advice before and during your claim. Most people however take the offer as part of a “something is better than nothing” approach which is fair enough. It may take a few letters and some time but it will be worth it in the long run.