Money News
As if the nation's major banks don't indulge in enough sharp practice consumer magazine Which? claims to have found yet more. In an investigation it has uncovered the tricks that some banks are using to deter customers who challenge their overdraft charges.
And it's not only those who confront their bank that suffer. Which? discovered that some banks are: Closing - and threatening to close - accounts, passing accounts to debt collectors, delaying requests for statements/charging too much for them and delaying their responses to, or ignoring, customer letters. The magazine says it has also heard of some customers being offered personal loans or increased overdrafts in place of refunds.
Doug Taylor, personal finance campaigner, Which?, comments: "Thousands of people have successfully challenged their bank and had their charges refunded. With over 150,000 downloads of information and template letters from which.co.uk alone, it seems many thousands more are set to take on their bank.
"It is really simple to start the process and banks must respond to any query within eight weeks. If they don't - go straight to the Financial Ombudsman Service."
The Office of Fair Trading (OFT) announced last year that it would investigate charges. And with the results due in the spring, time is running out for this particular money-spinner.
Taylor adds that it's important that the exposure of these tricks doesn't put people off re-claiming their charges, as that would be playing into the banks' hands.
The Which? Bank Check investigation also found that it isn't only the customers who try and reclaim charges who are being short-changed. Some banks are acting to make overdrafts more expensive for all their customers before the OFT announcement. Indeed, from October to December 2006, the Bank of England base rate rose by 0.25%; yet in the same period, NatWest upped its unauthorised overdraft rate by 2.3% and Lloyds TSB raised its rate by 2.70%.
29 January 2007 © Moneyextra.com
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