26th June 2009 - Update to overdraft bank charges court case

On 27 July 2007, the Office of Fair Trading (OFT), 7 UK banks (including HBOS and Lloyds TSB) and Nationwide Building Society, started a court case to decide on the legality of unarranged overdraft bank charges.

Full details of the announcement

The case has been called a "test case" because the decision will clarify the law in this area. It is likely to apply to all current and new claims against current account providers about unarranged overdraft bank charges.

We believe that unarranged overdraft fees are fair and reflect the service customers receive. It is important for everyone that we have legal certainty over unarranged overdraft charges.

The first step in this process was a trial of certain 'preliminary' issues in relation to the terms and conditions used by the banks at that time, which concluded on 8 February 2008.

On 24 April 2008, the Court issued its judgment on this first stage of the test case process. It decided that the banks' current charges can't be penalties, but that they can be assessed for fairness under the Unfair Terms in Consumer Contract Regulations 1999 (UTCCRs). The banks appealed this first stage judgment at a hearing before the Court of Appeal which concluded on 5 November 2008.

Following further hearings, the Court also decided that HBOS’ and Lloyds TSB's historic terms and conditions can't be penalties, but like the banks’ current charges they can be assessed for fairness.

On 26 February 2009, the Court of Appeal held that the banks' charges can be assessed for fairness. The banks appealed this judgment to the House of Lords at a hearing which concluded on 25 June 2009. The judgment of the House of Lords is awaited.

Further Court hearings may be needed before the test case process is concluded.

As previously agreed with the FSA and the Financial Ombudsman Service, customer complaints relating to unarranged overdraft charges will currently remain on hold. The banks will continue to ask County (England and Wales) and Sheriff (Scotland) Courts to keep cases relating to unarranged overdraft charges on hold until the test case process is concluded.

On 3 April 2009 the OFT announced the next stage in their ongoing investigation into unarranged overdraft charges. The OFT believe that by looking at a representative sample of bank terms and conditions, the investigation process will be streamlined and shortened.

For more information, please see our overdraft charges Q&As

Complaints

At Intelligent Finance, we aim to provide you with the highest standards of service, however, there may be an occasion when you feel you have cause for complaint. If so, our staff will do all they can to resolve the problem and ensure that you receive a quick and fair response to any complaints you may have.

We have a complaints handling procedure in place. Our procedures meet the standards set by the Financial Services Authority (FSA). The FSA have published consumer guidance on how to make a complaint. Copies can be downloaded from the FSA website Or you can contact them on 0845 606 1234.

Phone Us

Our Contact Centre staff are available to speak to you seven days a week on 0845 609 4343. Most customers' concerns can be resolved by our Contact Centre staff, who will do all they can to help. If they are unable to do so the complaint will be passed to a specialist team for investigation.

Write to us

If you prefer, write to us at:

Intelligent Finance
Customer Relations
PO Box 17316
Edinburgh
EH12 1AY

E-mail us

If you are an existing customer and are registered online with us you can use our secure e-mail facility to send us your complaint. To do this you must log in to your plan and select the 'Contact Us' function. You will receive an automatic response to confirm we have received your e-mail, which will then be passed to the Complaints Team for investigation.

OUR PROMISE TO YOU

Our complaints procedure is designed to ensure that each complaint is dealt with fairly and to your satisfaction. We will send you an acknowledgement letter within 5 working days of your complaint being received by us. If our investigations are not completed within 4 weeks, we will confirm by letter the reasons for the delay.

If our investigations have not been completed within 8 weeks, we will outline our findings to you by letter, explain why we have been unable to resolve the issue and highlight your referral rights to the Financial Ombudsman Service. We will be pleased to deal with all your concerns, however if your complaint relates to additional services offered to Intelligent Finance customers via a third party, you may wish to contact them direct.

For matters relating to Pinnacle Insurance plc:

Pinnacle Insurance plc
Pinnacle House
A1 Barnet Way
Borehamwood
Hertfordshire
WD6 2XX

Telephone: 0208 207 9005

For matters relating to Halifax General Insurance Services Limited:

Halifax General Insurance Services Limited
Trinity Road
Halifax
HX1 2RG

Telephone: 01422 439 901

For matters relating to Legal & General Group:

Legal & General Assurance Society Limited
PO Box 1186
Hove
East Sussex
BN3 1SD

Telephone: 0870 010 4080 ²

The Total Mortgage Protection Plan (TMPP):

The TMPP Administration Unit
PO Box 534
Uxbridge
UB8 1WF

Telephone: 0845 600 6007

REFERRAL TO AN OMBUDSMAN

We are committed to resolving complaints whenever possible through our complaints procedure. If we are unable to resolve your complaint we will provide you with details of how to refer your complaint to the Financial Ombudsman Service. The Financial Ombudsman Service is an independent service for consumers with unresolved complaints about financial firms and offers a flexible and informal dispute resolution service.

You can contact them at:

The Financial Ombudsman Service
South Quay Plaza
183 Marsh Wall
London
E14 9SR

Telephone: 0845 080 1800
Email: enquiries@financial-ombudsman.org.uk
Website: www.financial-ombudsman.org.uk

² Daytime calls Monday to Friday from BT landlines to 0870 numbers will cost no more than 6p a minute plus an 8p connection fee. The price of calls through other phone companies and from mobile phones will be different. The call price we have quoted was correct in March 2009.

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