Banks accused of credit card con
Some banks are deceiving customers who try to reclaim default charges on their credit card bills, campaigners allege.
They say the banks have been telling courts to halt their cases, because of a separate decision affecting efforts to reclaim overdraft charges.
Most cases involving overdraft charges have been suspended, pending a High Court test case next year.
But banks are falsely applying this to credit card cases as well, says the Moneysavingexpert.com website.
"Many banks are outrageously trying to apply the hold on bank charges reclaiming, to credit cards reclaiming, even though the Office of Fair Trading already sorted this out back in April 2006," said Martin Lewis of Moneysavingexpert.com.
The British Bankers' Association said this should not be happening.
"This only applies to current accounts and should have no effect on credit card claims," said a spokeswoman.
"The Financial Services Authority is monitoring how this is working," she added.
'Disgrace'
Mr Lewis has been a leading campaigner against excessive penalty fees being levied on bank accounts that go into the red.
"It's a national disgrace," he said.
"The FSA made it plain the hold only applies to bank charges, yet banks' lawyers are disgracefully trying to bully customers, using it as an excuse to suggest it applies to credit card cases too," he added.
In April 2006, the Office of Fair Trading (OFT) said it would not challenge the legality of credit card default fees, so long as they were set at a level no higher than £12.
In practice, most banks have reduced their default fees to that sum, but some customers are still trying to recoup the money they paid out in years gone by.
Lorraine Kay from Warrington described her experience after trying to reclaim £465 from Monument credit card.
"After I applied through MoneyClaim online, the court came back saying there was a stay on the claim," she said.
"I told them that it doesn't apply to credit cards, so they sent me a form to fill in and said I even had to pay to challenge the stay.
"I'm on income support, but I have to go down to court and prove this or I'll have to pay to challenge," she added.
High Court
Hundreds of thousands of people have successfully sued their banks for the return of overdraft fees, imposed when they go into the red without permission.
The wave of litigation in the district and county courts hit a peak in the first half of this year, when an estimated 329,000 people reclaimed approximately £570m from the main high street banks.
That prompted the OFT and the banks to agree a test case, to be heard in the High Court in 2008, to decide if the regulator has any jurisdiction to rule that the charges are unfair.
Part of the deal was an appeal to the judiciary to halt, for the time being, all outstanding and any new overdraft claims.
Some of these have been channelled through the courts, while others have been directed to the Financial Ombudsman Service.
This policy has generally been successful for the banks, with most judges agreeing to stay proceedings for the time being.
Source: bbc.co.uk
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