Over 40,000 businesses and individuals have signed up for a class-action lawsuit against 12 of Australia’s major banks for allegedly charging too much for overdraft fees, the legal firm organising the suit has said.
Small businesses are still being encouraged to sign up for the lawsuit, as there is no cost to sign up and no legal fees if the case is lost.
Ben Slade, principal at Maurice Blackburn, which is handling the legal case, says the action has been more popular than first expected.
“It does seem to be fairly popular, and there is just more than 40,000 entities that have signed up. The community temper against the conduct by the banks is significant, and the only big question for us was whether we are willing to launch in and do all this legal work and take on this risk. We think it’s a good cause.”
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Slade also says the amount of businesses signing up for the class-action will not affect the size of payments, and urges SMEs considering signing up to do so or they will miss out on potential payments.
“The measure of damages will be provided through the court as the difference between what people paid and the amount they should have paid, and will be subject to negotiations.”
“The number of people in the case won’t have an actual impact on the payments, and really, it’s not going to blow up the size of the case too dramatically. One estimate has been that the case will be in the billions because people were charged that, but realistically I think it’s somewhere in the realm of $100-400 million.”
The banks involved in the case as defendants are ANZ, Bank of Queensland, Bank of South Australia, BankWest, Bendigo Bank, CityBank, Commonwealth Bank, HSBC, National Australia Bank, St George, Suncorp and Westpac.
The lawsuit, which is being funded through IMF Australia, intends to recoup fees that have been charged by banks where a business or individual overdraws their account. Maurice Blackburn says the banks have actually charged their customers more than what is reasonable, with charges sometimes being $50 above the appropriate cost.
Slade emphasises there is no cost for businesses to join the action, and emphasises there is a significant chance of success.
“There is a strong prospect of success. The Australian common law and a number of cases has confirmed the propositions that these penalties are in excess.”
“It is an absolute no-brainer as far as consumers are concerned, there is no risk for anyone. If you’re in it, you may be paid, but if you aren’t in it then you definitely won’t be paid. There will be no impact on your relationship with the bank, you can’t be targeted, so there is no reason not to join this class action.”
Businesses looking to join the case can sign up through the Financial Redress website.