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Bank charges 'perpetuated the problem of debt'
25/04/2008 13:57:00
Unauthorised charging enforced by banks only "perpetuates the problem of debt", one financial expert has claimed.
The comments from Chiltern's Nathan Gladwell follow a ruling from a judge in a test case that the Office for Fair Trading (OFT) can decide on the fairness of the charges, which many consumers have been trying to recover.
Mr Gladwell said that taking expensive charges from customers who had exceeded their credit limits and were already in trouble only made the problem of debt worse.
"These people needed help and guidance from banks, not draconian punishment, and these excessive fees meant they would have less money each month to cover their living costs - putting further strain on already overstretched budgets," he said.
Thousands of cases currently on hold in county courts in the UK are frozen until May 22nd, after which the banks can appeal.
Figures from the OFT estimate that banks make £3.5 billion a year from unauthorised overdraft charges – the equivalent of almost £400,000 an hour.
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