Not upheld: Irresponsible lending complaint against Santander UK Plc

Decision detail

Summary

Mr P complained that Santander unfairly applied charges on his current account with overdraft facility from December 2022 onwards, describing the fees as 'exorbitant' and requesting a full refund. An investigator found Santander had been proactive and supportive, but Mr P disagreed. The ombudsman upheld the investigator's view, finding that the consistent month-by-month reduction of the overdraft limit from £1,400 to £500 between October 2023 and February 2024 demonstrated either that Santander took appropriate corrective action or that Mr P was managing the overdraft sustainably. Without evidence of financial difficulty at the time charges were applied, the ombudsman declined to order a refund and did not uphold the complaint.

The Ombudsman's reasoning

The ombudsman applied FCA rules (CONC 5D) requiring firms to identify repeat overdraft users in financial difficulty and take corrective action. The consistent month-by-month reduction of Mr P's overdraft limit demonstrated either that Santander met its obligations through corrective action, or that Mr P was managing the overdraft sustainably. Without evidence that Mr P was in financial difficulty at the time charges were applied, and with the overdraft being reduced significantly, there was no basis to order a refund of charges. The ombudsman clarified that commercial charging decisions are not within the ombudsman's remit, and that refunds are only ordered where errors have caused detriment.

How this compares

Source

Read the original decision on the Financial Ombudsman Service website