The Supreme Court has dealt a blow to hundreds of thousands of people who have demanded compensation from their bank and building socieities over sky-high bank charges. On November 25,2009, after months of deliberation, the five judges of the court unanimously decided that the Office of Fair Trading (OFT) did not have the authority to determine the fairness of the charges.

This has seemed to quash the hopes of an estimated one million customers who have lodged demands for the return of their money, in what has been hailed as one of the biggest consumer revolts ever. They have been warned that they are likely to be turned down unless they can prove they are suffering financial hardship.

Some consumer groups argue that bank customers should not accept defeat. There may yet be further developments, with the OFT perhaps bringing a second legal challenge against the banks. However, it looks as though the chances of your claim being successful are pretty slim.

That said, if you think that you still have a valid claim what should you do?

STEP 1: Work out if you can make a claim

If you've paid a penalty fee after going overdrawn without permission, exceeding an agreed overdraft limit, having cheques bounced or direct debits or standard orders declined you could have a case. By law you can only make a claim for charges paid in the last six years.

STEP 2: Calculate how much you were charged

This should be spelt out on your bank statements. If you haven't kept your statements, you can write to your bank to ask them to provide this information. Under the Data Protection Act 1998 the bank must provide this information within forty days and, if you ask for a computer printout of charges, they cannot charge you more than £10.

The bank may try to charge you more for providing a copy of statements but a computer printout is acceptable evidence.

If the bank refuses to provide you with this information contact the Information Commissioner.

STEP 3: Make a complaint

Write and say you believe all the past charges were disproportionate and you want all the money back.

STEP 4: Take action if your bank rejects your complaint

If your bank rejects your claim you should first go to the Financial Ombudsman Service (FOS). It can order companies to pay compensation for valid complaints even if the firm has previously rejected it.

Its response to the Supreme Court's decision reads as follows: "Our initial view is that the legal ruling means we will now be unlikely to be able to help with cases we had put on hold that involve "template" or "standard letter" complaints about unauthorised overdraft charges.

"But in keeping with our usual approach to complaints that are referred to us, we will review each case individually – to see whether there are any one-off circumstances that may apply. For example, we would expect current-account providers to deal positively and sympathetically with a consumer in financial hardship – including where bank charges had added to their difficulties."

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Which?

The Office of Fair Trading

British Bankers' Association

Financial Ombudsman Service

Information Commissioner