The Fair Play on Fees group has named Kiwibank as the second bank it will sue, on behalf of some of that bank's customers, over so-called exception fees.
The group, including Australian law firm Slater & Gordon, litigation funder Litigation Lending Services, and New Zealand lawyer Andrew Hooker, has already launched a case against ANZ, which ANZ is defending. It has also promised to take cases against ASB, BNZ and Westpac.
Kiwibank customers must register at www.fairplayonfees.co.nz by 11pm on Thursday, November 21, 2013 to ensure their inclusion in the case. Court documents will be lodged on Friday, November 22.
The lead plaintiffs for the case are Auckland couple Leanne and Sydney Briggs. The Briggs banked with Kiwibank for six-and-a-half years and in that time were "hit with" more than 100 default fees, totaling almost $2,000.
Leanne Briggs, described as "a busy working Mum" said she was regularly charged despite having transferred money to her account the day before to cover an automatic payment. "Technically Kiwibank said I was still overdrawn because the money didn’t go in until the following day because the payment went out that same morning. The default fees happened so often and I couldn’t do anything about it, no matter how many times I called."
Hooker said 6000 people had signed up for the claim against Kiwibank and he thought by the time proceedings were filed that number could be doubled.
He promised that people would "hardly have time to draw breath" before the next bank to be sued is named. He hoped proceedings could be filed against a third bank before Christmas.
The group alleges the following fees charged by banks over the last six years are unenforceable penalties which should be returned to participating customers:· Unarranged overdraft fees;· Dishonour fees;· Credit card late payment fees;· Credit card over limit fees. Fair Play on Fees stands to pocket 25% of any money it wins for bank customers.
Kiwibank had no initial comment to make.
Slater & Gordon's Ben Hardwick, said Kiwibank had been chosen next because “Kiwibank is just as bad as the other major banks when it comes to default fees”.
Hooker, asked if Kiwibank was perceived by customers as the "next worst offender" after the already named ANZ, said that proportionate to its customer base the percentage of Kiwibank’s clients that registered were the second largest, though they were not the largest or second largest by numbers.
"But the second reason why we chose Kiwibank was when people got to register with our website they had the opportunity to make comments and it became fairly obvious to us that from the comments that people were making who were registered with Kiwibank, who had banked with Kiwibank, were really annoyed that they had actually changed to support Kiwibank when it was established because they thought Kiwibank was going to save them from these fees
"And they were very angry to find out that Kiwibank was essentially as bad as the other banks in fee charging. So, it was both the number and the real unhappiness of their customers."
"...My clients who have contacted me, 6000 of them who have registered, a large amount of them are very sad that this bank that was established to take on the Australian banks seems to be mimicking what the Australian banks are doing."
This is the statement put out by Fair Play on Fees today:
Fair Play on Fees has today named Kiwibank as the next bank to face a class action over unfair penalty fees.
Kiwibank customers must register at www.fairplayonfees.co.nz by 11pm on Thursday, 21 November 2013 to ensure their inclusion in the case. Court documents will be lodged on Friday, November 22.
“Today is a positive step for the campaign. We now have a sufficient number of Kiwibank customers to take their complaint to court and fight to get their unlawful penalty fees back. We expect thousands more Kiwibank customers to join the campaign as a result of today’s announcement and encourage them to do so before the court documents are filed.
“We also encourage customers of all the remaining banks who have been affected by penalty fees to sign up to the Fair Play on Fees action. Today is also an opportunity for customers of all banks to take a stand against these unlawful fees.”
The High Court recently made orders requiring all ANZ/National Bank customers who wish to join the case to do so by 13 December. Court documents relating to that case were filed in June 2013.
The launch of Fair Play on Fees has seen more than 35,000 Kiwis sign up to date, of which over 6,000 are Kiwibank customers.
The lead plaintiffs for the case are Auckland couple Leanne and Sydney Briggs. The Briggs’ banked with Kiwibank for six and a half years and in that time were hit with more than 100 default fees, totaling almost $2,000.
Leanne Briggs, a busy working Mum, says she was regularly charged despite having transferred money to her account the day before to cover an automatic payment. “Technically Kiwibank said I was still overdrawn because the money didn’t go in until the following day because the payment went out that same morning. The default fees happened so often and I couldn’t do anything about it, no matter how many times I called.”
She was once charged $10 plus interest for being 2 cents overdrawn on a mortgage payment for a few days. Eventually, Leanne switched banks.
Hooker says a common theme among the Kiwibank complainants is that they had joined the bank because they were frustrated with the way they were being treated by their Australian owned bank. “These customers were then bitterly disappointed to find they were treated no differently by joining a Kiwi owned bank,” Hooker says.
The complainants will argue that the payment of penalty fees charged by Kiwibank over the past six years significantly outweigh the cost of facilitating the transactions. The penalty fees include unarranged overdrafts (account out of order fees), rejected payments on deposit accounts (dishonour fees), late payment and exceeding a credit limit on credit cards.
The team behind the case is New Zealand lawyer Andrew Hooker, Australian class action experts Slater & Gordon and litigation funder Litigation Lending Services. The litigation is structured to ensure claimants have no upfront costs and nothing to lose by joining the action. All legal services are provided on a no win, no fee basis.
New Zealanders can join the action against unfair bank fees by registering at: www.fairplayonfees.co.nz.