The Office of Fair Trading (OFT) has asked Banks to disclose historic errors involving loan agreements after it become alarmed that the problem is endemic amongst a large number of Banks. Northern Rock, the Co-operative Bank and Barclays have all recently paid out several hundred million pounds in compensation claims.
The OFT have put up to 50 banks and building societies on notice after the three banks admitted to having to refund some of their personal loan customers because their paperwork did not comply with the Consumer Credit Act.
Northern Rock paid £270m to 150,000 people in December 2012, and in September it emerged Barclays faced a bill estimated at £100m to repay as many as 300,000 customers. Last month, Co-operative Bank revealed it had increased its provisions for customer redress, in part to cover "an identified breach of the Consumer Credit Act".
The errors occurred because the Borrowers were sent incorrect documentation in a breach of the Act. The OFT has now stepped in following recent failures by some banks to fully discharge their obligations.
These revelations further confirm what everybody has come to learn over the last 5 years, that the Banks do not always do everything correctly and are also not very likely to own up to their mistakes.
The question then arises; how do you hold the Bank to account if you have a suspicion that you have been treated unfairly in relation to your borrowings?
Firstly you should seek professional advice from professionals who are familiar with the consumer credit act and how this act applies to your borrowings. The next set is for your professional to mediate a return of funds or compensation.
GDP Partnership specialises in this form of mediation with the Banks and has recently secured refunds for several clients in relation to errors in lending practises and miss management of accounts.
Author : Louis Waters ACA
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