Alliance & Leicester customers who take the bank to the Small Claims Court to recover unfair bank charges are now being asked to take their business elsewhere.

Customers are increasingly aware that the level of charges levied by banks when overdrafts are exceeded, or payments returned, are considered unfair. The Office of Fair Trading (OFT) ruled in April that any charge over £12 would automatically be classed as unfair, warning banks and credit card companies that they could face legal action if they failed to comply.

Strong warnings from the Office of Fair Trading (OFT) have caused Barclaycard, HSBC and Lloyds TSB to reduce their credit card penalty charges by almost half.

On 5th April, the OFT announced that it considered the high penalty charges made by many credit card companies to be unfair and illegal. It warned companies that if they would be defending their charges in court if they didn't take swift action to bring the charges down to a maximum of £12. Penalty charges are made when a borrower misses a payment date or exceeds their credit limit, and should only be set to cover certain administrative costs.

Yesterday the BBC reported that Barclaycard, HSBC and Lloyds TSB had all reduced their penalty charges by almost half from £20 to the new £12 threshhold.

The Office of Fair Trading (OFT) has successfully stopped claims by a company that claimed its magnetic jewellery could offer pain relief and reduce swelling.

Magna Jewellery Limited had suggested that magnetic therapy could help with a variety of medical conditions and that scientific research backed up their claims. Another company Magno Pulse is shortly to meet the OFT in the High Court having refused to co-operate with their requests to change their advertising of magnetic therapy products.

An Essex motor dealer, Ellite Carriages, has been refused a consumer credit licence by the Office of Fair Trading (OFT) after it was found a director of the company had recent criminal convictions.

Ellite Carriages Ltd of Harlow in Essex, had its application for a consumer credit licence refused on the grounds that Marlon Gordon, a director of the company, was convicted on 31 October 2002 of conspiracy to handle stolen goods.

As a result, the adjudicator decided that the applicant was not fit to hold a consumer credit licence and accordingly the application was refused.

Directors of two companies, that were wound up for fraudulently claiming to be selling advertising spaces on behalf of the emergency services, have been strongly warned about their future business conduct.

The two companies, Cavendish Black Ltd and McAllister Stone Ltd, had been cold calling small traders across the UK asking if they wanted to advertise in magazines and, in the opinion of the Office of Fair Trading (OFT), giving the misleading impression that they were connected to the Police and emergency services in that area and that some traders had placed advertisements when they had not.

A second hand car dealer from Blyth in Northumberland has been refused a consumer credit licence by the Office of Fair Trading (OFT) after an investigator uncovered a criminal offence for violence against him.

Nicholas David Fennell had his application for a credit licence refused on the basis he was convicted of unlawful wounding on 18 March 2003. He trades from 113B Front Street, Bebside, Blyth, Northumberland, NE24 4HN.

Southampton motor dealer Euro Continental has lost its consumer credit licence after an investigation from the Office of Fair Trading (OFT) found that two of the partners in the business had criminal convictions.

One partner had been convicted of common assault, drink driving and failing to stop after an accident, the second partner had been imprisoned for obtaining money transfers by deception. Both partners failed to declare any of these convictions on their application, an offence itself under the Consumer Credit Act.

Two estate agents from Tynemouth have been warned as to their future conduct by the Office of Fair Trading after a complaint revealed that their agency was not complying with legislation designed to protect consumers.

Gordon Reed and Jason Roberts, director and former director of Coast and Country Estate Management Limited, trading as Roberts & Reed, 39 Front Street, Tynemouth have promised the OFT that they will ensure they are fair in their future dealings with customers, in particular:

• providing all prospective clients with written details of their charges and fees before they are committed to any liability towards them
• not making any misrepresentations as to the existence or status of any prospective purchasers; and
• passing on all offers promptly and in writing.

The Office of Fair Trading has finally gotten tough with credit card companies overcharging customers to the tune of £300 million per year through unfair and excessive default charges.

The charges are made by the credit card companies when you go over your credit limit, pay late or fail to honour a payment. By law the charges are supposed to cover the actual costs, but the OFT has found that companies are in fact profiteering by imposing high fees that way exceed the true cost of managing the account.

The move is a further attempt to force the industry to start playing fair with borrowers. Hidden charges throughout the industry subsidise incentives and special offers that lenders use to win over customers. Excessive default charges means that those who can least afford them are paying for card companies to give interest free periods and other incentives.