The High Court have today ruled that further investigation into the fairness of bank charges is necessary.
The long awaited result of the current account bank charges case has today been published. However, while it spells good news for the consumer, those who are still ‘owed’ by their bank should wait to celebrate.
Today’s verdict simply represents the conclusion of a test case in legal principle and doesn’t actually address the issue of whether the much contested bank charges are fair. It does however represent the first step on the path to this decision.
Essentially, the High Court today found that bank charges do fall under the jurisdiction of the Office of Fair Trading (under the 1999 Unfair Terms in Consumer Contracts regulations) and, as such are liable to be assessed and monitored by this consumer watchdog.
Consequently, this now means that the OFT are in a position to continue their assessment of the fairness of these charges and, if deemed necessary, to regulate and restrict them.
The decision to go to court was a joint one made last year between the OFT and the 7 banks and 1 building society that provide 90% of the UK’s current accounts after they became inundated with bank charge refund requests from their customers.
Since the decision to try the case was made, the FSA agreed to allow the banks in question to suspend any action relating to pending refund requests until the issue was resolved by the high court.
For this reason, although promising, today’s decision does not impact consumer’s ability to claim a refund in anyway. However, it is hoped that they will be able to do so shortly after the High Court reconvenes to try the fairness of these charges in May.
