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FSA issues new waiver on unauthorised overdraft charge complaints

The FSA has issued a new six-month waiver from its complaints handling rules on unauthorised overdraft charges.

While it is in operation, any bank or building society granted the waiver will not be required to handle this type of complaint within the time limits set out in the FSA rules.

The waiver replaces an existing one, which expires on 26 July, and has been offered to those firms who signed up to the previous waiver. This represents approximately 98 per cent of the market.

The FSA says it can revoke the waiver at any time if it considers it is no longer appropriate.

FSA retail policy director Dan Waters says: “The FSA continues to work closely with the OFT and banks in reaching a resolution on the fairness of unauthorised overdraft charges. Our objectives continue to be certainty over this complex issue, and a fair and consistent resolution of consumer complaints about unauthorised overdraft charges.

“The FSA has reviewed the prevailing circumstances and has decided to offer firms a new waiver. The waiver will be for six months, when we expect to have a decision from the Court of Appeal.”

Which? head of campaigns Louise Hanson says the waiver is a necessary evil.
She says: “Scrapping it won’t get people their money back – only the banks can do that by conceding defeat and paying up instead of continuing to string out the process.

“In fact, lifting the waiver would actually see consumers losing more money. The clock would start ticking again on people’s claims even though they’ve no prospect of getting their money back until this whole issue is sorted out.

“We’re glad though that the FSA has listened to our concerns about hardship cases and banks changing their terms and conditions. People in financial difficulty need greater clarity and banks must be prevented from moving the goalposts with detrimental changes to their terms and conditions.”

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