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Barclays To Refund At Least 300,000 Borrowers

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http://www.bbc.co.uk/news/business-24122659

Barclays Bank is to refund at least 300,000 personal loan customers because it made mistakes on their paperwork.

If mistakes are made in loan paperwork, all interest paid must be returned.

The errors, which are expected to cost Barclays about £100m, date back to October 2008. The bank said it would begin to contact the affected customers in the next month.

It is investigating whether similar mistakes had been made in other parts of the business such as Barclaycard.

The errors on statements and arrears notices were mentioned with the bank's annual results in February, when it reported that income from retail and business banking had "declined 4% to £1,086m primarily due to provisions taken to remedy historical interest charges incorrectly applied to customers".

More details were given on Monday in a prospectus that the bank put out as part of its attempts to raise £5.8bn in new capital from investors.

..

The error is similar to one made by Northern Rock Asset Management, which announced last year that it would be returning interest paid by 152,000 borrowers as a result of mistakes in paperwork.

Still I'm sure that full bonuses have been paid out on these loans and no banker will be asked to return their share of the profits. The only people expected to pay are the shareholders with a reduced dividend payout?

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So that's 100M pumped into the economy.

And if you took out a loan and the interest was calculated wrong, and they have to repay you all interest, how does that work if you have defaulted on the loan?

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So that's 100M pumped into the economy.

And if you took out a loan and the interest was calculated wrong, and they have to repay you all interest, how does that work if you have defaulted on the loan?

and 100m off the capital of the bank....thats 1bn in lending gone assuming a 10% money multiplier

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