November 25, 2009

Millions of current account customers could come a step closer to reclaiming 'unfair' charges they paid on unauthorised overdrafts today when the supreme court hands down a long-awaited appeal ruling.The ruling on a case between the Office of Fair Trading (OFT) and seven banks and one building society, due at 9.45 this morning, will determine whether the fees charged for unauthorised borrowing can be tested under the Unfair Terms in Consumer Contracts Regulations 1999.

About 1.2 million people have lodged claims with their banks for repayment of the charges in anticipation of the case ending, but consumer group Which? has estimated the banks could face up to 8 million more claims if they lose.A source in the banking industry said the banks were expecting the ruling to go against them; if it wins the OFT is expected to say that overdraft charges dating back to 2001, and possibly even earlier, are unfairly high, and will call on the banks to pay back at least a proportion.

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