Not upheld: excessive and unfair overdraft charges; irresponsible lending complaint against TSB Bank plc

Decision detail

Summary

Mr A complained to TSB in August 2025 about excessive and unfair overdraft charges applied to his current account while he was persistently overdrawn, with an overdraft limit of £1,000. TSB rejected the complaint as made too late, and Mr A referred the matter to the FOS. The ombudsman found the complaint was made more than six years after the charges were applied (August 2019), exceeding the standard time limit, and that Mr A should have been aware of his cause to complain by August 2019 when he received account statements. Although the complaint could be reinterpreted as an unfair relationship claim under the Consumer Credit Act 1974, the Supreme Court's guidance in Smith v RBS supports denying remedies where claimants delay more than six years after knowing the facts. Furthermore, all charges that had not already been refunded were applied before August 2019, meaning no charges remained to be refunded. The complaint was not upheld and no compensation was ordered.

The Ombudsman's reasoning

The ombudsman found that Mr A's complaint was made more than six years after the charges were applied (August 2019 to August 2025), exceeding the standard six-year time limit. The three-year extended period under DISP 2.8.2R(2)(b) did not apply because Mr A should have been aware of his cause to complain by August 2019 when he received account statements showing the charges. While the complaint could be reinterpreted as an unfair relationship claim under s140A of the Consumer Credit Act 1974, the Supreme Court in Smith v RBS established that courts are slow to remedy unfairness where claimants delay more than six years after knowing the facts. Additionally, all charges that had not already been refunded were applied before August 2019, meaning no charges remained to be refunded within the six-year lookback period from the complaint date.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website