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Can you challenge bank fees and charges?

If you have ever strayed into the red, chances are that you have been shocked by the sudden bank fees and charges that have been applied to your account. If you feel that you have been treated unfairly by your bank, it is still possible to challenge the fees imposed, and get them reduced or cancelled.

Banks aren't always friendly

In 2010 the major High Street banks won a Supreme Court appeal against the Office of Fair Trading. The ruling decreed that the OFT did not have the right to decide whether bank fees and charges were fair. Consumer groups were surprised and angered by the decision.

However, this does not mean that bank customers do not have any rights to protest against a bank charge that seems unjust. It can pay to know your rights.

When a bank charges for a bounced cheque or unauthorised overdraft, it is important that the sum must reflect an accurate estimate of the cost to the bank. Anything above that would constitute a penalty, which is not legally enforceable.

Look out for familiar bank tricks like charging you £25 for a letter informing you that your account is overdrawn. This cannot be justified in terms of cost to the bank, and can be challenged in many cases.

A challenge will require you to make a close inspection of your statements, going back months, or even years, and highlighting all bank fees and charges that seem unjust.

If you do not have all your statements, you can write to your bank and demand a list of all charges. They are obliged to provide this information under the Data Protection Act. Being banks of course, it won't be quick. You will have to wait up to 40 days.

Pursue your rights

Your initial step, once you have the data, should be to write to the bank and ask for a refund of your bank fees and charges. If your case is strong, you may have some success. Otherwise, if you are claiming less than £5,000, your best course of action may be to initiate a case in the small claims court.

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