25th November 2009 - Outcome of overdraft bank charges court case

Summary of Supreme Court Judgment

On 25 November 2009 the Supreme Court said that the level of unarranged overdraft charges isn't assessable for fairness under the Unfair Terms in Consumer Contracts Regulations. This means the banks have won their appeal and the test case has concluded.

This is a final judgment from the Supreme Court as they have decided it's not necessary and/or not in the public interest to make any reference to the European Court of Justice.

Questions and Answers

What does this mean?

The Supreme Court decided that an unarranged overdraft charge is a key part of a current account.

This means that where the charges are explained in clear language, under consumer fairness legislation, the level of an unarranged overdraft charge can’t be challenged to see if it’s fair or not.

What happens next?

While the Supreme Court judgment was a win for the banks, we acknowledge the concerns some of our customers have with these charges. We'll work with the Financial Services Authority (FSA) to ensure the outstanding customer complaints are brought to a swift conclusion. We'll also continue to work with the Office of Fair Trading (OFT) to agree a positive way forward.

What does this mean for customers who have complaints about unarranged overdrafts on hold?

During the test case, we agreed with the FSA and the Financial Ombudsman Service (FOS) that customer complaints relating to unarranged overdraft charges would remain on hold.

As the judgment concludes the test case, the FSA has agreed that these complaints should no longer remain on hold.

This means that for those customers who currently have an outstanding complaint about unarranged overdrafts, we’ll be writing to them shortly to let them know what today’s judgment means for them.

We'll asking the County and Sheriff Courts to apply the Supreme Court judgment to dismiss any claims they currently have on hold.

What will happen to new customer complaints about unarranged overdraft charges?

As this judgment concludes the test case, the FSA has agreed that the waiver on bank charges complaint handling should be lifted. This means we'll handle complaints through our standard process. We'll continue to treat customers sympathetically who are vulnerable and in financial hardship.

Can I complain to the Financial Ombudsman Service (FOS) about my unarranged overdraft charges?

Yes. Where a customer's complaint isn't accepted by a bank, the customer has the right to take their complaint to the FOS.

Where can I find more information?

The Financial Services Authority

The Office of Fair Trading

The Financial Ombudsman Service

The Supreme Court

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 0300 500 5000.

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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