25/11/09- British Banks that include Abbey National plc, Barclays Bank plc, Clydesdale Bank plc, HSBC Bank plc, Lloyds Banking Group plc, Royal Bank of Scotland Group plc and Nationwide Building Society will be pleased by the Supreme Court judgment toady concerning unfair bank charges. The Supreme Court judgment, overturned previous High Court and Court of Appeal rulings that unarranged overdraft charging was unfair
The Office of Fair Trading investigation centred around personal current accounts in relation to Unfair Terms in Consumer Contracts Regulations (UTCCRs) and the fairness of the level and application of unarranged overdraft charges.
The OFT is disappointed by today’s ruling and will now consider the detail of this judgment before it makes a decision on whether or not to continue its investigation into unarranged overdraft charging terms. It will also explore with others the implications for consumers and for existing and future legislation and regulation. The OFT expects to make a further announcement in December.
The OFT set out its concerns in relation to unarranged overdraft charges as part of its 2008 market study. This found that banks earn around a third of their retail revenues from unarranged overdraft charges that are difficult to understand, not transparent, and not subject to effective consumer control.
