Many of the Penalty Fees being charged by banks are not enforceable and should not be charged.
Since 2004 with the release of the Rich Report, the banking industry and the Government became aware that Penalty Fees charged by banks (such as Honour / Dishonour fees) are illegal. The law only entitles banks to recover their costs, not to profit from these fees.
In the UK, Banks have now handed back over a Billion Pounds wrongly deducted from customers accounts. The Government Via the UK Office of Fair Trading has moved to formally set maximum amounts that banks can charge to recover costs.
In Australia however, despite this knowledge, banks are continuing to take these fees from customers accounts and only under direct threat of court action from individual customers are refunding these fees. A free report along with a template letter for requesting a refund from your bank is available at www.loanchecker.com.au/bank-fees
The Government has failed to act to protect australian citizens from what amounts to theft on a massive scale.
Senator Steve Fielding introduced a private members bill to refer the matter to a senate committe which should have reported its findings prior to the election. This report however was delayed by the coalition controlled senate to report after the election in order to avoid this matter becoming an election issue.
It is our intention with this Petition to put the issue back on the agenda and for both parties to publicly confirm that they will act to enforce the return of these penalty fees to banking customers.
1. Instruct ASIC and or the ACCC to enforce the return of Penalty Fees that have been wrongly taken from customer’s accounts over the past 6 years.
2. Instruct ASIC and or ACCC to set a maximum Penalty Fee that is not greater than the costs incurred by the respective bank in handing the non conformance for which a penalty fee is charged.
3. Set up and fund an independent mediation program for matters that are outside the terms of reference of the Banking Ombudsman.
4. Hold a further wide ranging senate enquiry into the banking industry and its interaction with customers both individuals and small business particularly with regards to ensuring that all customers have access to natural justice and a free of charge mediation system in dealing with disputes with banks.
5. Further consult with the public, small business and consumer advocate groups by way of the enquiry (4.) to ensure that the rights of individuals and small business when dealing with banks are enshrined in law.
6. To require ASIC to investigate with a view to prosecution any senior banking management that introduced illegal fees and or allowed those fees to be continued to be applied whilst they knew or should have known that such fees were illegal.