Wednesday 25 November is judgement day

| November 17, 2009 | 0 Comments

The ongoing legal battle between eight high street banks and the Office of Fair Trading (OFT) over unauthorised overdraft charges might actually reach a conclusion next week.

Wednesday 25 November is the date that has been set for the Supreme Court to decide whether the OFT has the power to assess whether or not bank charges are fair.

Banks and building societies were charging over £35 for a bounced cheque, standing order or direct debit. However, it was established that the actual cost incurred by the financial institutions could be as low as £2.

As a result, in July 2007, the OFT began a test case about unauthorised overdraft charges against Abbey, Barclays, Clydesdale, HBOS, HSBC, Lloyds TSB, Royal Bank of Scotland and the Nationwide Building Society.

The eight banks represent 90% of the current account market and the OFT believes banks receive approximately £3.5 billion each a year in unauthorised overdraft fees (the equivalent of almost £10 million a day).

It is hoped next Wednesday will give a final ruling but it could still be a while before people will know if they are to be refunded.

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