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11.02.2007 Andy vs Alliance & Leicester – Part 1

You can probably tell from my recent post that I’m not especially happy with Alliance and Leicester lately. There are a number of reasons for this, the first being their (kinda) shoddy internet banking security and the other being their insistance on charging unlawful fees for things like failed payments and the like.

In case you weren’t aware, when a bank charges you £30 for failing a direct debit or for going over your agreed overdraft, they are actually breaking the law. The reason for this is that under UK law, a bank may not lawfully charge you more than it costs them to actually issue a letter. So… £2 to send a letter would be acceptable, £30 is just plain wrong.

The sad news is that many people just accept these charges, thinking that because a bank is doing it then it’s ok. The good news is that because all banks state in their terms and conditions that they agree to operate in a lawful fashion – you can demand that they return up to the last six years worth of unlawful banking fees to you knowing full well that you have the law on your side.

Several thousand people have already successfully claimed back these charges, so you would think that by now the process would be pretty easy. Guess again. I’ve been reading up on the subject and it would appear that even after losing in the small claims courts quite a few times, the banks will still argue the case and make it as difficult as possible for you to claim back their charges.

From what I’ve heard the process for claiming back your bank charges goes something like this:

  1. Send bank letter requesting details of last six years charges
  2. Wait four weeks for response from bank
  3. Recieve ‘data protection’ form.
  4. Return form + cheque for £10
  5. Wait four weeks for response from bank
  6. Instead of what you asked for in step 1, recieve last six years bank statements in full.
  7. Go through statements with a highlighter finding all unlawful charges and add them together
  8. Send letter to bank requesting refund for unlawful charges
  9. Wait four weeks for response from bank (again)
  10. Get letter from bank denying refund
  11. Reply to bank insisting on refund quoting all applicable laws
  12. Wait four weeks for response from bank
  13. Recieve a letter offering you a tiny amount of owed money
  14. Send letter to bank refusing their offer
  15. Wait four weeks
  16. Receive another refusal letter from bank
  17. Apply to small claims court
  18. Send summons to bank with court date
  19. Receive ’see you in court’ letter
  20. Await court date
  21. Day before court date recieve letter from bank agreeing to settle
  22. Reply accepting their offer
  23. Wait four weeks
  24. Receive cheque
  25. Success!

This lengthy process puts off a lot of people, but a friend of mine started his battle with his bank back in October of last year and believe it or not, eventually got the cheque just over a week ago! (start of Feb!).

I heard about this procedure late on in December and started the process at the beginning of January. So far, I’m at step 7, with step 8 starting hopefully tomorrow. It’s a long and drawn out battle, but due to my quite frankly stupid management of my funds over the past six years should result in a hefty cheque coming my way.

In all honesty, I don’t have a problem with banks making charges on my account when I’m stupid with my money, what I do have a problem with is the fact that a) they do it when they know it’s illegal and b) that in the past one charge has caused me to recieve another charge. (For instance direct debit ‘a’ fails, bank charges me £30 taking me over my agreed over draft limit causing me to get another £30 charge and minor direct debit ‘b’ to fail leaving me with another £30 charge. Total charges: £90).

Yes, in the past I have been stupid with my money but lets face it, when you’re young and don’t earn much sometimes that happens – nowdays I earn more and handle my money in a more grown up fashion.

Anyway… I’ll keep you up to date with my progress as it happens – in the mean time, here’s a couple of handy links for those of you that are interested in joining the fight:

14 Comments »

  1. February 13, 2007 @ 11:53 am

    Hmmm maybe I should try this with the bank of Sainsbury’s. I’ve about as much love for them as you do for A&L. =)

    — Jules

  2. March 11, 2007 @ 7:18 pm

    Some banks are changing their terms and conditions in an attempt to get around the issue. They may find they are going to get themselves in hotter water if claims go to court and the new terms are deemed to be an attempt to avoid the refunds. The banks must be very worried and frustrated as soon as they heard “how to I claim my bank charges back?”

    — Mark Bateman

  3. March 13, 2007 @ 2:30 pm

    I’ve paid hundreds od pounds in bank charges to A&L over the years. I have been with them since 1988, not that they care. I went 4.87 overdrawn last month for 5 days but they did not tell me. I had to pay 50.00 in charges but the charges being taken from my account had sent me back overdrawn and led to more charges, another 25.00. So by being overdrawn by 4.87 A&L have charged me 75.00! What fiasco, I have written to them for an explanation but I not expect much sympathy from them.

    — Mairead Woodman

  4. June 25, 2007 @ 5:27 pm

    is there not a web site that helps you claim your charges back as well as helps you get your bank statements aswell

    — craig

  5. July 23, 2007 @ 2:06 pm

    I am having the same trouble with alliance and leicester, i have paid over £150 in unreasonable bank charges in the last two months,it’s a joke.A failed direct debit left me with a £34.00 charge on a Monday and because my weekly wage does not get paid into my account until Friday they put a £25.00 charge on top as i was over four days overdrawn,it is a absolute disgrace,because of the bank i hav efallen behind on my rent and bills,im also 7months pregant aswel so i cannot afford to buy as much stuff for the baby that is needed because of the constant bank charges,i had a statement this morning asking for another £50 charge on Aug 2nd,i CANNOT pay that charge so i rang Alliance & Leicester to tell them that i cannot pay and they said that if i don’t pay then £25.00 will be added to the charge every four days,i tried to shut the account down but they won’t let me until i pay the charges,i can’t afford to pay the charges and i won’t pay them, does anyone know where i stand with this and if i have any rights?

    — Natalie

  6. July 23, 2007 @ 5:36 pm

    Hi Natalie,

    I assume you’ve tried demanding a supervisor? Usually speaking to a supervisor yields someone with a bit more intellect.

    The trick is, when making phone calls stay calm, be polite and friendly – if you get angry with them, they’ll give you crap back – if you’re nice, they’ll go out of their way to help you. Do not mention on the phone that you will be claiming your fees back because that puts them on the defensive and they will help even less.

    If this fails then try the following:

    The first thing I would do is create a separate account and move your bill payments (direct debits etc) to there, and start paying your pay into that account instead. Once that’s done, call up and speak to their collections department, explain the situation and ask for them to put your account on hold and a chance to pay back the fees. (perhaps ask for an overdraft facility so you can pay the fees with that and pay back the overdraft at your leisure).

    Then pay back the fees as soon as possible and start the proceedings to get your fees back. It’ll take a couple of months but it’s worth it! Once you have the money back, cancel the account and deposit your money into your new account.

    I know paying back the fees is tough, but it’s better than getting a CCJ on your name!

    (PS – I’m no expert, I’m just talking from my experience as having been through this myself and also as someone who works as a call centre supervisor!).

    Good luck with the baby!

    — AndyK

  7. August 13, 2007 @ 5:42 pm

    a&l sucks keep charging me charges, im all ways in black, having move to a new bank.

    — mike

  8. August 20, 2007 @ 7:26 am

    if moneyexpert helps they take a percentage of what you win i think. i wanted to try and reclaim but was warned that the banks have started to close your account if you file a claim. is this true does anyone know? i’d be stuck if so as liveoff my overdraft! dont know what barclays are like but bet they would if they can. this is scandalous. i think they should be FORCED to automatically hand back the cash to customers and not make us have to go through all this palava.
    Note to Natalie: I feel for u what with a baby on the way to try and budget for! you go for it – put in claim love. it cant be anymore stressful than the worrry and burden its causing you. they make me SICK! Best wishes for the future

    — pip

  9. August 30, 2007 @ 6:39 pm

    A&L have done me big time, went five ponunds over drawn, refused to pay it so it went from 40 to 90…so i paid it ( knowing that they will lose the test case in court :) ) then get a statement two weeks later chrging me 50 pounds,,,for being over drawn between the period of time when they were ‘dealing’ with my complaint……chaging banks then getting all charges back with interest!

    — adam

  10. September 28, 2007 @ 12:57 pm

    Just spent an hour on phone to A&L being passed from advisor to advisor and not happy as now have to wait 7-10 days for letter on my complaint pending outcome of court case.

    I had a payment due to go out on 17th Sept and was worried it might sned my A&L current account overdrawn, so logged in to check so I could transfer funds from my other A&L account to cover if needed. Was showing a positive balance, and a payment pending (ie presumably due to go out on 18th as was already 9pm on 17th). When I logged in on 18th the pending payment had been backdated to having being processed on 17th, before funds landed on 18th. ie I was not showing over-drawn when I check initially and was able to resolve, but once funds landed my account was showing as having gone overdrawn by less than £60 presumably for the period from 9pm on 17th to 9am on 18th. ALl of which has cost me £50-01 – £25 for paying DD when funds not available, £25 unauthorised overdraft fee, and 1p interest for period of being overdrawn.

    This was my main current account, I have never been over-drawn before and always manage the account carefully, and I am furious!! Will wait the 7-10days to see outcome, but have already closed my other A&L savings account, and if not satisfied with outcome will be looking for new internet account – I hear Nationwide are better?!

    — CJ

  11. November 1, 2007 @ 7:23 am

    Hi all
    As you know with the announcement in July that some of the banks (A&L not one of them) are taking this to the high court to investigate the precedent that these charges are valid liquidated damages and not a penalty. Now A&L just send out standard letters referring to this. However I went overdrawn as a result of fraud on my account. I believe the fraud took place at their end, since it affected both accounts on the same day! My other bank accounts with Barclays were fine. This caused me to go overdrawn and they still charged me for bounced DDR. I have rang on many occasions and still they refused to refund the money. I have now lodged a complaint with the FSA.

    Yesterday I came into another bank charges letter. I did what I was instructed to do I transferred the money between my two accounts the night before the DDR were due, I didn’t go overdrawn, yet still they charged me.

    It seems the A&L seem to use the excuse of 24 hour access to your account that is why money needs to be in the night before, since DDR are taken just after midnight. Yet when you are crediting your account to avoid charges, they use the excuse of the old fashioned bank cut off time for having money in your account.

    It seems the logic programmed into the computers at A&L isn’t the same as the information given to their staff and it addition it contradicts each other.

    When you try and speak to someone, all they will do is lodge your complaint and refer it to the charges team, who then just send out one of those standard letters. That is if you get through in the first place, due to call waiting times and refusing to put you through if you don’t have your phone pin to hand.

    I have only banked with the A&L since Feb this year; I am already moving my account. Never have I come across a useless unhelpful incompetent firm in all my life.

    — Sharon

  12. February 14, 2008 @ 1:20 pm

    Right, Alliance & Leicester are completely useless!!! – Dec 28th, went 56 pence overdrawn, spoke to a customer adviser the same day and said if its going to cause a problem i’ll pop in the branch pay the couple of pennies cash or pay it over the phone via another card. She resurred me that it wouldn’t be a problem and would block any future charges for the time being. (good reasult i thought). This reasurance was short lived, 32 days later and £75 already been told out of my account i spoke to the manager, sorry she said ill get the money refunded. after 10 days (and after another £50 charge) i was refunded £100. Still leaving me £25 out of pocket, this is still going on.

    What really got me mad was when I was reading though my last couple of years statements. Novemeber 2005 I was charged £25 even though I wasn’t overdrawn this is down to a adim mistake, as a result of this charge this made me overdrawn so I got charges the following month, again the following month and so on up to a figure of £250 beause of their admin error. I know i should noticed this straight away but as a young lad believed it was my own fault at the time. I phoned A&L to tell them about their mistake, the response I got was that I should of notcied striaght away and as a result of not noticing their mistake its very unlikely I will get my money back. This is still going on, and the feeling i get everytime is like im in the wrong for not noticing this??? how does this make sense???

    — brett

  13. April 26, 2008 @ 12:13 am

    Do not open an account with Alliance and Leicester.
    They dont care about their customers even customers who pay thousands into their accounts every month. One month when I didnt pay in £500 they charged me £5 for not paying in enough money pushing the account into minus £5. Then they proceeded to charge me £5 a day for 22 days until I noticed when I was sent a letter with over £100 of bank charges. I called the bank stating it was clearly a one off error and that I was a good customer. Tough luck they say. You have to pay over £100 in bank charges.
    DO NOT USE ALLIANCE AND LEICESTER. I will be paying the charges then closing this useless bank account and then claiming these illegal bank charges back via the courts if I have to. This company have no morals. BEWARE!

    — Charlie

  14. May 30, 2008 @ 9:56 am

    This doesn’t exactly relate to bank charges, but supports the fact that A&L don’t really care about their customers.

    Five years ago, myself and a friend who have since bought a house together, had a meeting with A&L to discuss a possible mortgage. Within five minutes, the woman at the Leicester branch simply said ‘well, as graduates, you need to get better jobs don’t you?’. We felt quite offended, and proceeded out of the building faster than you can say ‘it’s a joke’. On our way home, we noticed a large poster in the window of HSBC saying that they would give us mortgage… or £25 in cash. I quite fancied the idea of some free money after the fiasco with A&L, so we ventured inside. Two hours later, we’d been signed up to a HSBC mortgage, and on a great rate too. They bent over backwards to help us get on the property ladder and boy, did it pay off! However, every time I go into A&L now, they desperately try to pursuade me to switch to their ‘fabulous’ mortgage, saying that whoever told us to ‘get better jobs’ was not acting appropriately. Easy to say now eh? Oh, and suffice to say, the woman concerned isn’t working at A&L any more. Maybe she got a ‘better’ job.

    — Dee

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