The Law Applied To Bank and Credit Card Charges
This law has recently been of great interest to UK bank and credit card customers who have been charged as much as £39 for a single transaction that took them over their credit limit. Consumers argued these charges were well beyond the cost of sending a computerised letter.
In 2007 the Office of Fair Trading investigated the excessively high charges being imposed on customers of credit card companies. In its report, the OFT confirmed these charges were unlawful under UK Law as they amounted to a penalty. It said it would be prepared to investigate any charge over £12, though this was not intended to indicate that £12 is a fair and acceptable charge. The OFT said it would be up to a court to determine such an amount based on the established legal precedent that the only recoverable cost would be actual costs incurred.
The credit card companies did not produce evidence of their actual costs to the OFT, instead insisting their charges are in line with clear policy and information provided to customers.
Following the ruling, many bank customers have made County Court claims against their banks and credit card companies for return of penalty charges for returned cheques, direct debits and unauthorized overdraft charges. To date no bank or credit card company, save NatWest on one occasion, has attended at Court for a Trial.
- OFT v Abbey
Read more about this topic: Liquidated Damages
Famous quotes containing the words law, applied, bank, credit, card and/or charges:
““Teacher, which commandment in the law is the greatest?” He said to him, “You shall love the Lord your God with all your heart, and with all your soul, and with all your mind.’ This is the greatest and first commandment. And a second is like it: You shall love your neighbor as yourself.’ On these two commandments hang all the law and the prophets.””
—Bible: New Testament, Matthew 22:36-40.
“Any language is necessarily a finite system applied with different degrees of creativity to an infinite variety of situations, and most of the words and phrases we use are “prefabricated” in the sense that we don’t coin new ones every time we speak.”
—David Lodge (b. 1935)
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With sweet musk-roses, and with eglantine:
There sleeps Titania sometime of the night,
Lulled in these flowers with dances and delight.”
—William Shakespeare (1564–1616)
“Gratitude among friends is like credit among tradesmen: it keeps business up, and maintains commerce. And we pay not because it is just to discharge our debts, but that we might the more easily find lenders on another occasion.”
—François, Duc De La Rochefoucauld (1613–1680)
“There is undoubtedly something religious about it: everyone believes that they are special, that they are chosen, that they have a special relation with fate. Here is the test: you turn over card after card to see in which way that is true. If you can defy the odds, you may be saved. And when you are cleaned out, the last penny gone, you are enlightened at last, free perhaps, exhilarated like an ascetic by the falling away of the material world.”
—Andrei Codrescu (b. 1947)
“I have never injured anybody with a mordant poem; my
verse contains charges against nobody. Ingenuous, I have
shunned wit steeped in venom—not a letter of mine is dipped
in poisonous jest.”
—Ovid (Publius Ovidius Naso)