Banks back in court over charges

By Jennifer Hill, Personal Finance Correspondent

LONDON (Reuters) - Customers could learn later on Thursday whether banks are to appeal against a ruling that potentially paves the way for current account holders to reclaim billions of pounds in fees.

The High Court ruled in favour of the Office of Fair Trading (OFT) five weeks ago, allowing the consumer affairs watchdog to press ahead with an investigation into whether banks can legally charge customers who slip into the red without prior agreement or who write a cheque that bounces.

The banks and the OFT will meet in court again on Thursday at a case management meeting to set the timetable for the next steps, at which either party is allowed to appeal against the original ruling.

The meeting is expected to last most of the day and could run over into Friday.

If the banks appeal, the case could go to the Appeal Court and the Lords before the full case goes to court -- and that could take two years or more.

If not, it will be up to the OFT to decide whether these "default" charges actually are unfair, and if so deciding upon a "fair" level of charges.

Until the test case is resolved, customer complaints and court cases relating to the charges are on hold.

Martin Lewis, founder of financial website MoneySavingExpert.com, said: "It's hoped the banks won't delay the process further by appealing this decision.