HSBC censured for making false claims about charges

HSBC has been criticised for falsely claiming that current account customers could withdraw cash abroad without charge.

The Advertising Standards Authority said the central claim of TV adverts for its Bank Account Plus was misleading because HSBC charged a 2.75 per cent exchange rate fee.

The ASA dismissed the bank's argument that the fee only covered processing costs and ordered the bank not to repeat the claim.

The ruling comes as HSBC's decision to end interest-free overdrafts for graduates has encountered opposition. More than 3,000 former students have joined "Stop the great HSBC graduate rip-off" on the social-networking website Facebook since the decision was announced in June.

In its TV advertising for Bank Account Plus, six people from different countries held up their local currencies. Viewers were told: "Whoever's on the banknotes, with Bank Account Plus you can withdraw them worldwide and we won't charge you."

Text at the bottom of the screen stated that cash withdrawals abroad would be free. Nationwide Building Society, which offers free card use abroad, complained the claim was misleading.

In its defence, HSBC said it applied no special fee for withdrawingcash abroad and that all of its foreign currency transactions attracted an exchange rate fee.

The ASA acknowledged that HSBC detailed the exchange rate and its calculation to customers in bank statements. "Nevertheless, we considered that the 2.75 per cent adjustment made by HSBC was essentially a transaction fee that would be charged to the customer," it said.

HSBC said: "We genuinely believed the television commercial was factual, but we acknowledge and accept the judgment of the ASA."