'Unfair' bank charges left me penniless, barrister tells court

A bank customer was so denuded of money by "disproportionate and unfair" charges that he was left penniless on his 30th birthday, a court heard yesterday.

In a test case against NatWest, Tom Brennan, a barrister, claimed that its charges had been so high he had experienced difficulty paying rent and expenses during his legal training.

He spoke of the distress caused by penalty fees on his current account as he fought a civil action against the bank, which he is determined to shame in court.

According to Which?, British banks are making up to £4.75bn a year from penalty fees, which can be up to £38 for a bounced cheque or direct debit. Campaigners say the real cost is about £2.50.

Mr Brennan is asking the Mayor's and City of London County Court to rule that his charges were so high they were illegal. If he wins, other bank customers may be able to bring similar claims and the industry may have to cut charges. But if he loses, the campaign for refunds - backed by The Independent - will experience a setback.

Mr Brennan faces being declared bankrupt if costs are awarded against him, ruining his legal career. The lawyer, who was charged more than £2,000 in fees, has declined an out- of-court settlement from the bank of £4,000. As well as a full reimbursement, he is seeking damages for the stress he encountered and the difficulty he had paying rent and buying necessary items.

He is also seeking exemplary damages, which are awarded when a wrong is deemed to be deliberate, malicious or negligent. NatWest is seeking to have the case thrown out before a trial.

At court yesterday, Mr Brennan, of Lewisham, south London, said that on his 30th birthday, he was so hard up he could not afford to buy a single pint of beer.

Explaining the essence of his case, he said: "It is a fact of life that we can't always keep to financial commitments. But that doesn't justify any bank acting unlawfully in charging disproportionate fees."

At an earlier hearing NatWest said that Mr Brennan should not be trying to be a "guardian of consumer interest" while the Office of Fair Trading (OFT) is investigating the issue.

Mr Brennan responded yesterday saying that the OFT could not force banks to pay back charges; it could only stop them from levying future fees.

Judge Simpson told the newly qualified barrister: "It does seem as though you are conducting a crusade." Mr Brennan replied: "Lives are ruined by these types of charges ... this is not a crusade, all I want is justice.''

Ben Pilling, for NatWest, said allowing the claim to go forward would "eat up the court's resources in a way that was disproportionate''.