Welcome

Do you have to pay bank or credit card charges? No, not if they are a penalty or 'unfair' charge. This website tells you about UK law on unfair charges and how to get your money refunded for free.

Latest Scottish news:

| UPDATE : THIS SITE WILL BE UPDATED SHORTLY FOLLOWING THE OFT'S TEST CASE DECISION IN LONDON, TO EXPLAIN AND HELP CITIZENS IN SCOTLAND PURSUE REFUNDS|

Small claims limit in Scotland raised to £3,000 for claims raised on or after 14 January 2008

Sheriff gives go ahead for bank charges claims - (Murchison Law Solicitors of Inverness appearing for GLC). Sheriff Pyle's written judgment is available at: Thomson v Bank of Scotland; and Coleman v Clydesdale Bank; (added 11 September 2007). Five more bank charge cases to proceed at Edinburgh Sheriff Court (added 12 September 2007) Update: these cases were settled in full with expenses (added 1 February 2008)

Bank charges:
GLC note on opposing applications by UK banks to sist Scottish claims pending the OFT's High Court case in London - links to PDF download (added 17 August 2007).

Guidance on opposing stays in England & Wales is available from the Consumer Action Group here (added 18 August 2007).

On 5 April 2006, the Office of Fair Trading (OFT) concluded that default charges over £12 are automatically presumed to be unfair in terms of the Unfair Terms in Consumer Contract Regulations. Unfair terms are legally unenforceable.

Charges below £12 may also be unlawful - the distinction is that the OFT will only take enforcement action for charges above that figure.

Let's take a standard example: you exceed your credit limit by £15.98, most banks will send a letter charging £39, they may also impose a £28 monthly unauthorised overdraft fee, and will almost certainly levy unauthorised interest at over 30% per annum. That's a mark-up of over 419%. Sound fair?

The legality of bank charges has yet to be ruled on by a senior UK court but these will not be enforced if they are found to be 'penalty' or 'unfair' charges. The law is clear on that.

A contractual party can only recover real or 'liquidated' losses at common law in Scotland, England, Wales and Northern Ireland. While banks say charges 'cover our costs' it is estimated that UK banks make £4.7bn worth of fees each year from charges. Banks impose charges to off-set the cost of bad debts - that is quite different from the 'costs' in your case. The courts could also find that charges are 'unfair' under the Unfair Terms in Consumer Contract Regulations 1999/2083 - See OFT NEWS.

Not sure how many charges have been applied to your account(s) within the last few years? You can request this information from your bank under the Data Protection Act 1998 (DPA) for a cost not exceeding £10 (for all accounts/years - see example). An style DPA letter is here (doc) (PDF) If you do not receive a response within 40 days you should lodge a complaint with the Information Commissioner.

Click here for information on where proceedings can be raised in the UK.