Banks 'block refunds by using dirty tricks'

Some have begun writing to customers who have won their money back warning they will lose their existing current accounts if they make a similar claim in future. However, the move may be illegal.

The banks are under enormous pressure to give refunds totalling tens of millions of pounds following an inquiry by the Office of Fair Trading (OFT).

Scroll down for more...

Last year, the OFT issued a legal opinion which suggested that charges of up to £39 for going overdrawn or bouncing cheques were likely to be an unfair penalty.

This news triggered attempts by tens of thousands of customers to reclaim charges dating back over the last six years.

However, the banks have employed a range of tactics to prevent customers from pursuing their claims.

Some have refused to provide back copies of bank statements, which is in breach of the Data Protection Act.

Others have dragged out responding to complaints beyond the redress period in the industry's banking code.

Some have gone as far as to close the accounts of the customers involved in retaliation, a move condemned by the Financial Ombudsman Service.

The latest twist involves telling customers who have won a payment that their accounts are threatened if they try to do the same in future.

Settlement letters issued by at least two current account providers have sought indemnity from future challenges as part of a deal to reimburse unauthorised overdraft fees, according to claims management firm BrunelFranklin.com.

One such letter from Royal Bank of Scotland warns that the bank could pull the plug on a customer's existing banking services if they do not accept future charges.

It states: "Any charges that properly accrue in the future will be applied to your account in line with our published tariff and in accordance with your agreement with the bank.

"Should you be unwilling to accept any such charges, then we may need to consider if we are prepared to continue to provide you with your existing banking facilities.

"Instead, we may offer you a simple account that does not offer borrowing facilities or other services that can result in charges."

A settlement letter from the Co-operative Bank to one of the claims management firm's clients warns that no further refunds will be given unless it is due to a bank error.

Ian Allison, corporate relations director for Brunel-Franklin.com, said the letters were evidence of the dirty tricks employed by banks to short- change customers.

He said: "We have become used to the banks asking customers to sign full and final settlement offer statements, meaning that even if the bank charges refunds are wrong, and too low, the customer will legally not be able to challenge the figure.

"The latest twist is even more underhand and may be simply unlawful. Getting a customer to sign to accept that they will not be able to make future claims goes against common justice.

"Rather than asking the customer to sign away their right to future refunds, we would suggest a fairer charging structure by the banks would be the answer."

A spokesman for RBS said: "If a customer is unwilling or unable to pay the charges for the services we provide or is considered a particular credit risk, then it is wholly appropriate for us to consider whether their existing account is best suited to their needs.

"As a responsible lender it may be appropriate to provide them with a more suitable account."