£100,000 fund to fight bank charges
Updated on 29 May 2007
Campaigners have pledged a £100,000 "fighting fund" to help bank customers in their legal battle against "unfair" charges, it has been announced.
The war chest will be used in cases in which there is a chance for a precedent-setting judgment in relation to current account penalty fees.
It follows a decision two weeks ago by a district judge at Birmingham County Court to dismiss a claim by bank customer Kevin Berwick against Lloyds TSB on the grounds that charges were a legitimate part of the current account service.
The fighting fund is made up of pledges from campaign groups MoneySavingExpert.com and ConsumerActionGroup.co.uk, as well as private individuals, and will be held in trust by the Govan Law Centre.
The Berwick v Lloyds TSB case led to concern that it would deter people from reclaiming fees of up to £39 levied on customers every time they go beyond their agreed overdraft limit.
Campaigners argue that such charges are unlawful as they do not represent the real costs to banks of administering a bounced payment or unauthorised overdraft.
Despite Mr Berwick's claim being dismissed in court, MoneySavingExpert.com's Martin Lewis urged people to keep on reclaiming. The ruling is not binding to other courts and hundreds of claimants have been successful in getting recompense even after the verdict was made public, campaigners have noted.
Mr Berwick said: "It is important people understand that the bank had already offered me a settlement before going to court. I decided I wanted to go ahead as I believe that the banks are wrong to take this money from us and I am proud that I stood up to them."
Since news of Mr Berwick's case broke, there have been reports of banks sending out letters to customers trying to deter them from reclaiming through the courts, campaigners said.
Mr Lewis, founder of MoneySaving Expert.com, said: "It is almost laughable. In football parlance the banks are crowing about the fact that they are now only losing 100,000 to one and not 100,000 to nil."
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