6 PM Tuesday 24 April 2012 Nunhead Heights.

I went over my overdraft this month and I am waiting to hear how much it is going to cost me. The overdraft is amount the bank allows me to borrow each month. They are very nice to give it to me and charge me only 19.9% interest. When I exceed the allowed amount because I forget to make a deposit or forget that I have to work to make a living, they slap my hand with penalty charges. Rather, they punch me in the gut.

Last time I went over was maybe 18 months ago – I have been good since then – they charged me £25 (or £35?) per bounced direct deposit or insufficient funds. They killed me for more than £200. I was paying higher interest than if I’d seen the boys with broken noses who broke legs – that is the kinda thing that my Brooklyn-raised father would say.

A few years ago, you could go to the bank manager and ask for the penalty charges reversed and they’d do it. And you could also write to the bank and tell them you wanted the money back you spent on overdraft charges over the years and they would give it back to you, too.

As an American, I thought: What? You mean they will just give you back the money they took?

The UK banks must have known they were doing something wrong and as long as only a few customers asked for their money back the banks could hold onto the bulk of it.

But if the powers-that-be knew it was wrong why were they allowed to continue doing it?

No one in Britain appeared to be trying to stop them. The press wasn’t alerting the public to it – it was all by rumour – lawyers weren’t initiating “class action” lawsuits on customers’ behalf, the regulators weren’t demanding the banks stop, and the prosecution office weren’t arresting the banking officials. Nothing.

Eventually too many people had heard that they didn’t have to pay the charges. If the banks had to return the billions of pounds of excessive fees to everyone who asked, let alone everyone who had been taken, it would have bankrupted them. And it wasn’t a good time for banks anyway, the late noughties. The banks finally took their chances in court and won. I think this is what happened. I am no journalist so tell me if I am wrong.

That is something I can’t get used to. The British will put up with something that Americans would go absolutely mental about. It is like no one is stopping the wolves from eating the chickens.

Instead of worrying until I get my bank statement I phoned the HSBC and asked how much it is going to cost me. The three “incidents” will be £50.

Well, it could have been worse and it was own damn fault. My own damn fault may be the reason Brits did nothing.

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And “it was my own damn fault” and “it was my own damn fault” thinking is very British. I’ll write about that soon.

@lewisschaffer

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5 thoughts on “Excessive bank charges, the Brits, and me. An incomplete history of Evil.

  1. Lewis, thanks for a most interesting blog post. As an expat who has returned to America after 22 years of living in London, I am reminded of several strong characteristics about life in England:

    1) People are willing to queue and get furious over those who would jump the queue
    2) This goes hand in hand with people tending to accept the drill, the way things are done
    This can make them phlegmatic, willing to accept things as they are (bank overdraft charges, etc), rather than push for change.
    3) New ideas on their own have difficulty gaining traction. People need to know that someone proposing a new idea first understands how things are currently done and can explain fully how the new way is better.
    4) For all that Britain has accomplished over 500 years in culture, politics and empire-building, individuals seem sometimes reticent to take the initiative to change how things are done. Almost like the Chinese saying, “It’s the nail that sticks out that gets hammered.

    Still, I miss the traditions, the civility, history and the sheer breadth of British experience in every walk of life

    1. Thanks Paul for reading these posts. You’ve learned a lot about the English. The Drill – the way things are done – is brilliant. I remember one woman saying to me, often and over and over, “That is not how it’s done here.” It can make an American mental, thought I was mental before I arrived.

  2. I seem to recall there was a campaign on a consumer/money advice site advising people to write to ask their banks for the money back and a lot of people were reporting success, but one guy decided to take his bank to court over the charges and lost and it set a precedent, so they all act a bit screwy now.

    1. Exactly. But don’t blame that one guy for taking the bank to court! That is very, very English of you. I think the banks realized they couldn’t keep paying out and needed to either press the point or go broke. But either way, why weren’t they stopped earlier or told it was okay earlier?
      xx to you Donna

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