Thread: OFT is a joke - where's the competition?

I was speaking to a client the other day who had been battered by her bank charges and she was ready to switch accounts.......so she asks me "Is there a bank account with no charges?"

What a good question I thought......so I had a look - well there is one:

HSBC offers a basic bank account that anyone can open, allows direct debits and will not charge you a penny for bouncing a direct debit or standing order. The account does not let you go overdrawn. Now that is amazing I thought.........HSBC seemingly have the ability to not allow customers on this account to go overdrawn and run up an unauthorised overdraft limit.......which begs the question Why cant this apply to any other account they offer?

Who knows.....oh yeah - massive profits needed for shareholders silly me .......anyways.........I was about to recommend this account to the lady when I looked at the small print "we reserve the right to close the account if you bounce more than three direct debits" - WHAT? Even people I know who are careful with money can easily bounce 3 or more DD's over a year or so......In fact that is the UK average............

If you are interested here is a list of "basic" bank accounts. All that is really basic about them is their ability to offer even less of a service than traditional current accounts while all charging suspiciously similar fees.....

http://www.moneymadeclear.fsa.gov.uk...k_accounts.pdf


So there are actually NO accounts available to UK customers on the high street that charge nothing at all. Make no mistake we are looking at a cartel. Banks make billions in profits. The Office of Fair Trading has failed in its duty to ensure that there is competition in the UK banking market. What currenty passes for banking in the UK is nothing short of organised crime. If the OFT can't see this and work to fix it instead of reluctantly starting a "review" and a "test care" then it should be scrapped. What is the point of paying taxes for a government body that can't even do what it was designed to do?

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that's an interesting view, alecmac, i have often wondered why the competition commision don't do an investigation.

You're absoloutely right, alecmac.

There is no true competition. If there was, then as you've already suggested on your other thread in this forum, at least one of the banks would have come up with something that would attract vast numbers of customers away from the others!

All the best - Adam.

Originally Posted by adamc6671

You're absoloutely right, alecmac.

There is no true competition. If there was, then as you've already suggested on your other thread in this forum, at least one of the banks would have come up with something that would attract vast numbers of customers away from the others!

All the best - Adam.

no chnve. they are all in bed with each other

They certainly are, and who's the ONLY looser?

You've guessed it - the Consumer!!!!!!!!!!!!!!!!! !!

Hi All

I believe this is one that the Competition Commission should be looking at VERY closely. The evidence of collusion seems to be very strong indeed, yet the 'powers that be' seem to be totally ignoring it.

It seems to me that 'the establishment' has no intention whatsoever of undermining the massively strong position of the banks - they are quite happy to see the consumer suffer to whatever extent is necessary to protect the financial strength of the banks, and hence 'the establishment' itself.

Just my opinion of course, but it does seem very obvious to me.

Adam.

We've been down this road already, a long, long time ago (well, about 2 years! ;-) )

The CC were not interested - suprise!!

It does however, in a strange way help us a little.

If and when the OFT/courts decide that the banks can charge what the hell they like for bounced cheques, DDs etc... then we have very good grounds to get the Wages Act changed. Currently employers have the right to choose how you are paid - before 1986 it was the other way around, and so it should be, it's my money, I should decide how I get it paid to me.

Under ECHR, any EU citizen must not be forced into buying commercial products or services by legislation, and as ALL banks make these charges (err...services apparently) then that is exactly what is happening, no?

Well, the wages act forces me to use a bank account when in reality, I would rather use a shoebox, so there are grounds for a change in the law due to the inconsistencies.

It's just a thought at the moment, but it could also be useful ammo for when/if the banks start charging monthly account handling fees etc...

Hi Dave

Since CAG went down the CC route 2 years ago much has changed. Serious evidence of collusion between banks is now there for all to see - no more so than the fact that, as far as I am aware, no bank has come forward with a 'no charge' regime that would attract many customers from other banks. Seems to me that it may well be worth trying the CC route again, using all the fresh evidence.

In parallel with that, a serious challenge to the fsa waiver should surely be mounted, with a view to force the banks to start dealing with complaints again, and to open the way for the fos to get involved once more. Do the FSA really have the legal right to allow banks to stop dealing with customer's complaints? Has a Lawyer looked at this one in depth? If not, perhaps one should do so ASAP.

Just trying to be constructive, Dave, in the hope of finding a way to get things moving forward again, at least from the Consumer's view point.

How about trying to negotiate a compromise solution with the banks - perhaps accepting a £10 charge, say, and reclaiming above that figure (which I've proposed elsewhere on the General Forum), and thus pre-empting the Test case and avoiding the need for very lengthy and costly legal proceedings? Or is that really just a waste of time?

We really do need to do something, Dave, and very soon, or surely the whole reclaiming scenario will disappear into the mists of time behind test case after test case and appeal after appeal. None of us really want to see that do we?

All the best - Adam.

Originally Posted by adamc6671

Hi Dave
Has a Lawyer looked at this one in depth? If not, perhaps one should do so ASAP.


All the best - Adam.

yes, they have. They are acting within the legal remit.

Originally Posted by tomterm8

yes, they have. They are acting within the legal remit.

Thanks for that tomterm. I feel strongly that the rest of what I had to say is still very relevant though. We must find a way of moving forward sooner rather than later, or we'll all be waiting years with NO guarantee of success after that!

Adam.

Originally Posted by Gez

I can't see how that could achieve anything but signalling total surrender!
You may consider £10 to be a fair maximum now, but who decides how often & by how much this figure increases over time? By the time it creeps back up to current levels or beyond, how do you challenge it when you have already accepted it. It would just shift the battle sideways.
Furthermore, by accepting penalty charges in principle, how long before all other goods & service providers write a bunch of new "service fees" into their T&C's?
Its this fundamental flaw that rendered the bank charges charter petition useless IMO.

Hi Gez

Fully understand what you are saying, and thanks for the reponse.

I really do feel, though, that a way forward MUST be found if at all possible or, as I've said before, the whole reclaiming scenario will disappear under test case after test case, and appeal after appeal. The sites, such as CAG, that give us so much help will have to survive for years with little or no income - can they do that? When it is finally resolved, if indeed it ever is, the backlog of cases will so massive that the systems for dealing with it will take very much longer to sort it all out than the test case & appeals themselves - can we live with that?

The list goes on and on. What we really need now is positive and co-ordinated thinking to find a way forward that stands at least some chance of success. If we don't, it seems odds-on that we'll all end up with little or nothing. Reading the OFT response to the banks, and all the documentation that went before that, makes it obvious that nothing will be settled in the short, or even medium, term unless we magange to move the goal posts now. As I see it, we should all be trying to think that way if we want at least something back from all that the banks have been taking from us for so long!

Food for thought, if nothing else!

All the best - Adam.

"Furthermore, by accepting penalty charges in principle, how long before all other goods & service providers write a bunch of new "service fees" into their T&C's?£

You are right with that statement. The fees are definately unfair and illegal. The situation is one of the banks own making and they've shot themselves in the foot. They could probably have got away with having a fee of £12 if they had dropped them a few months ago.........now I'm not so sure they have the oppertunity to carry on charging at all..........the fight is just too far progressed now. They had the same fight in Ireland a couple of years ago and they settled on a 'fair' fee of £3 (or was that 3 euros?). Martin Lewis is suggesting a fee of £5 which dosen't sound too bad (as long as it dosen't creep up - which unfortunately it will).

The saddest part about the whole thing is the FSA waiver - I think we can all agree that claimants have a right to at least some money back. The FSA waiver currently prevents banks from making 'Full and final settlement' and all the while it allows banks to carry on charging people the full £35 - whatever happens from here on in I think the attitude of the FSA in handing the waiver to the banks is the most shocking thing to come out of this whole mess. The bottom line is it had handed the banks a licence to steal - it flys in the face of the FSA 'treating customers fairly' inititive, and with Christmas coming up: Granny's, single mums, pensioners and families who are streched are giving their money up to the banks in the form of charges rather than paying for heating, food and a little seasons cheer. It sucks.

Hi alecmac

Sadly we're a very long way from the law deciding that fees are unfair and, above all, ilegal - in all probability a matter of years before ANY decision is reached. We may all THINK they are, and we may THINK we are all entitled to something back, but thats a very long way from the law deciding they actually are, and we actually are!

I think the banks know exactly what they are doing, and if we 'rest on our laurels' and do nothing for the time being, we are, in all probability, in for a nasty shock! There's no point in kidding ourselves. The 'waiver' is a prime example of that - the 'system' always has, and always will, play directly into the banks hands. Why? - because they are a foundation stone of our so called 'establishment'. We either accept that, wait a long time, and then get little or nothing, OR we react now and persuade 'the system' that it MUST pay credence to those of us that fund it - Consumers.

There's no point in just whinging that the system is unfair - we all know it is - we must act, and in great numbers, to engender change. If we don't we'll surely loose out. The days of the golden goose that pays out without actually going into Court are over, and gone. That change to the system, that WE made happen, was only temporary. The OFT, the FSA, and the Courts have combined to make sure it was that way in order to protect the banks, and IMO, will go on doing so. WE have got to act NOW to make permanent change happen, as I believe 'the system' will never do that on its own.

We've changed the system once, temporarily - we now have to do it again, permanently!

Adam.

Hey rant away. You're totally right. We've all go to use bank accounts - there is just no alternative. And all the banks have practically the same terms and conditions and charges. It is a disgrace and it hurts people on benefits and pensions the most.

And you are right about claims being daunting as well - CAG is great but there is a 'silent majority' out there who are just taking it on the chin and are unable to do anything about it.

But the more we rant and complain about it the closer we get to victory. Britain is a nation of letter writers. And we're all pretty good at it too. Write to your MP, write to the FSA, the OFT, fos and your bank. If we all just keep at it then eventually we'll win. I guarantee it.

Under ECHR, any EU citizen must not be forced into buying commercial products or services by legislation

Dave

If this is so.. how is car insurance explained then? I've often wondered - if this particular service is provided economically and for virtually no margin as all the providers seem to unanimously claim, how come the wall-to-wall saturation advertising budgets and the fact that car insurance is always the biggest payer in affiliate schemes and cashback sites?

Makes you wonder, doesn't it? I think there's potential here as something else we could turn our minds to...