Banking industry faces test case over charges

Mon, 14 Jan 2008

Anyone with a bank account may want to keep an eye on the news as the Office of Fair Trading (OFT) seeks to find out if overdraft charges applied by the banking industry are unlawful.

The OFT has launched a test case in the high court aimed at obtaining a ruling as to whether or not the unfair terms in consumer contracts regulations apply to unauthorised overdraft charges.

The case does not address terms and conditions of individual banks, though the OFT says it is monitoring information provided by the bank industry and would publish further information in future.

In the case the banking industry will be represented by Abbey, Barclays, Clydesdale, HBOS, HSBC, Lloyds TSB, Nationwide and Royal Bank of Scotland .

However, the banking industry has warned that they may have to start charging for current accounts if the OFT action is successful.

And millions of individuals have already gone to court in an attempt to reclaim their own charges, the Guardian reported.
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