LONDON: A Manchester accountant has successfully sued his bank, Lloyds TSB, over what he claimed as unfair penalty charges, and won 2,000 pounds as he threatened to send bailiffs to recover the money.

The bank said it agreed to pay the accountant, Brian Mullen, the money he claimed was taken from his current account in the bank’s Manchester branch towards penalties on bounced cheques, direct debits and standing orders when Mullen exceeded his overdraft limit, mostly when he was a student.

Mullen claimed these penalties were unlawful because they made money for the bank rather than simply cover its costs. He got a court order against the bank in February. As the bank failed to settle the claim, Mullen got a warrant of execution through bailiffs, who are empowered to seize the bank’s assets.

The bank said it did not pick up the claim as it should have and did not file a defence in time and he was given a default judgement. It decided not to challenge the judgement, but said in a statement that it believed its charges are transparent and fair “and to say these charges are unlawful is inaccurate”.

These charges are now subject of discussion and even the Office of Fair Trading is expected to advise banks to cut down the penalties on customers or put a cap.

Mullen, working to become a chartered accountant, said he fought the case without having to move from his computer. He found advice on a website, www.bankchargeshell.co.uk. and with this information prepared his case and fought it through the Court Service’s site www.moneyclaim.gov.uk.

He had to spend 120 pounds to get an original of the court order and 55 pounds for the warrant of execution. He said these costs are recoverable as the judgment is in his favour.