banks still claiming bank charges are legal

Banks use a “strange language” to pretend their overdraft charges are fair, the High Court has been told. Brian Doctor QC, for the Office of Fair Trading (OFT), said the language of bank contracts did not reflect “objective reality”.

He was addressing the court on the eighth day of a key test case to decide whether the OFT can rule on the validity of overdraft charges.

Seven banks and the Nationwide Building Society deny their charges are unfair.

 

They agreed to the test case to clarify their legal position after a mass of litigation, which has seen hundreds of thousands of consumers claim refunds totalling hundreds of millions of pounds.

‘Strange world’

Barristers for the lenders have told the judge hearing the case, Mr Justice Andrew Smith, that current account customers get a package of services for which they are charged a package of prices.

But Mr Doctor accused the banks’ QCs of trying to “cast a spell” over the court.

“We are entering a strange world in which the banks speak a strange language, in which customers are deemed to have done one thing by doing another,” he said.

Mr Doctor argued that some banks have, in the past year, been rewriting their contracts for running a current account to avoid any application of the 1999 unfair terms in consumer contracts regulations.