Thread: Appeal for price comparisons in space & time

Quote:
Originally Posted by AugAussie

"I have a question about the fees being disproportionate
If the fees are for a service is there anyone who could assertain if the price for the said fees has increase inline with cpi? if it indeed is a fee for service like dentist fees, then i would have thought the increase would be yearly or bi annualy inline with cpi.
Thoughts anyone?"

_________________________ ____________________

An excellent question. Yes, bank penalty charge have risen far faster than CPI, from £2 in 1970 to average £30 today. What would a price in step with CPI be today?

Until IT advances in recent years, cheques and credit pay-in slips were physically transported on night One by security vans, from the pay-in branch A to a central clearing hub just like a post office sorting centre. There it is sorted on Day Two and physically transported on Night Two to 10 thousand receiving branches. On Morning Three a cashier or three at the cheque's home branch Z will confirm signatures and dates and things like "words and figures do not agree", then alert the manager to manually decide whether to bounce or tolerate uncovered cheques. If bouncing, then that laborious physical journey is repeated in reverse, from branch Z eventually back to branch A. Hence in 1970 the £2 charge was well justified on grounds of manual cost, even if the bounce involved only a 50 pence cheque.

As IT advanced over the last 20 years, the physical travelling was reduced and manual intervention was reduced to a minimum, until today the costs of bouncing have been variously estimated at figures between 50 pence and £5. Instead of a local branch manager who knew about you, it is now impersonal nameless staff at vast Service Centres who in the first instance decide to bounce or not bounce, sometimes incomprehensible telephonists in India.

Even as bank costs fell sharply, bank charges rose sharply. Some banker or professor sympathetic to the cause could help us by producing objective evidence filling in the gaps, plotting the year-on-year rise of penalty charges while the OFT slept.

As well as comparisons across time, there are also comparisons across space. UK penalty charges are uniquely high. I understand US and Aussie prices are much lower, but I have to hand only a concrete figure of £3 charged in Ireland. Anyone with friends and relations in US, Canada, Aus, Singapore, etc could try and find out. I believe Tom Brennan's team have done research on comparative prices in the EU, so would have comprehensive figures there.

Such a credible comparison survey across time and space would be really helpful and would stand up in court. Better than saying to the judge,

"This price is too high -- I can really feel it in my bones, can't you?"

.

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Banks know to the penny the true IT cost of penalty charges, but guard it with their lives.

As the onus rests with claimants to prove that penalty charges are profit-making and therefore unlawful, the only option would be to draw comparisons across space and time. Claimants need to prove bouncing did not cost £39, or else his claim is not proven. Banks do not need to prove it did. Unless the claimant's case is good, the defendant need not get out of bed, as Kevin's opponent did not. Jog your dad's memories, ask your cousins overseas.

This question is not academic. Judges will want it answered in court, as Judge Cooke did with Kevin, i.e. how do you know bouncing a cheque does not cost £39?

Price Precedents

This question has not been given prominence because nobody had to face a judge until Kevin. That's not completely accurate, as CAGger barcote faced up to Egg in Oxford Court on 21st November 2006 and won. Himself a lawyer, barcote went to court armed with costings studies from USA and Aus pricing the charge at a fraction of the price submitted by Egg. Unlike the House of Commons and BBC evidence which was ruled as inadmissible in Berwick v Lloyds, the USA and Aus evidence submitted by barcote in this hearing was ruled by the judge as admissible. No account of the hearing is publicly availaable, but it appears an arbitrary compromise figure of £5 was agreed between the judge and barcote. Neither party wanted the case to be used by others as a battering ram, so detailed information remained muted.

In any recurrence of such a debate ib price I suggest that any claimant arriving without answers prepared will be at a disadvantage. I also suggest that actual prices charged in the marketplace, e.g. by a Dublin bank, will be more convincing than conclusions drawn by academic studies.

Success! Judgement AGAINST Egg...

Excellent post, Mistermind, and extremely helpful!

I'll contact friends in US and Aus and see what I can find out from there.

All the best - Adam.

An appeal for information across space and time

e.g. two Dublin banks £3 charge T&C:

http://www.accbank.ie/ul_fees_charges.html

http://www.aib.ie/servlet/ContentServer?pagename=RO IPersonalPortal/AIBContent_C/pp_article&c=AIBContent_C &cid=1136826345174&channe l=P001

From news available on the web since yesterday, no Kevin appeal (he will go to fos instead). Second win by Lloyds in court.

See 7 news links in

Sticky: Lloyds victory in Birmingham - in perspective (Last Page post #181)

petcat,

While England slept

Thanks for your support. Inhabitants of this green and pleasant land have historically been insular in outlook ("Fog in channel, the continent isolated"). It would be unthinkable for a price to stand at 3 euros in France, but 39 euros in Germany. We have exactly that, in £3 for a cheque bounce in a Dublin bank, but £39 in Abbey Bank. I suspect 99% of the population do not know this, 99% of judges do not know this.

An ally from space

In addition to the essential T&C, I suggest that all claimant bundles would benefit from inclusion of the two Dublin T&Cs printed showing £3, to demonstrate that UK charges are the errant exception, not the norm.

An ally from time

A historical graph plotting the vertical rise of UK charges over 30 years would illustrate even more sharply how this insular price rise by stealth completely got out of hand while the OFT slept. Hyperinflationary charges are the enemy of the Chancellor, I cannot see who else would be sympathetic apart from the beneficiaries. However, historical prices year by year need to be backed up by documentary evidence, so this pre-internet research back to yesteryear will probably need a journalist or academic with access to library facilities, possibly in the City of London -- unless anybody has kept 30 years worth of back statements including a few bounces over the years, lol.

A frightened enemy

I suggest the best battle to win is one without casualties, where a demoralised enemy walks away. Even if the Dublin £3 figure does not get a chance to be aired in court, its presence in the bundle helps to enlighten the judge, and gives notice to the bank that topics they least want publicized stand ready to be publicized, by this claimant herself. So fight her at your own risk.

Sticky:Is the bank taking your Benefits ? - I trust this is the thread you have read? I do not know this subject, so will leave it to those who do. I recall reading a post from a reputable Mod recently, that a certain letter will ensure the bank will keep their hands off your food money, unfortunately such warning needs to be repeated every week, said the Mod.

berwick v Lloyds 15 may 2007. This thread last night contained a new Lloyds template letter now going the rounds..................

GL
miao, X

Originally Posted by Mistermind

Charge for breach vs Fee for service

My own opinion only -- if I speculated between the lines correctly, then Lloyds will not defend against reclaims for pure-bounce penalty charges which conferred no favour on the customer. They WILL defend against "service fees in response to the customer's implicit request for a new/increased overdraft" where they did honour an unsupported cheque/DD. Three outcomes of a trial:

(1) Case proven, claim awarded in full.
(2) Case unproven and dismissed.
(3) Some claims proven, some not proven, only proven claim awarded.

I tried several times without success to get a lawyer on CAG to answer if

YES - verdict (3) can occur in Small Claims Court,
NO - outcome (3) will trigger verdit (2), i.e. claimant loses everything.

If the latter, then the reclaims of safe with-bounce charges could be jeopardised in total by reclaims of unsafe without-bounce charges.
In all cases Contractual Interest should be limited to debit interest actually levied by the bank, accrued only on the charges reclaimed.

Mistermind - this makes great sense. If you are right, and I think you may well be, it does, however, seem to imply that claims including 'service charges' for paying cheques, D/Ds, S/Os etc and at the same time increasing the overdraft beyond its current limit may well fail, or at least be defended in Court, whilst claims that include only 'bounce only' charges may well succeed or at least not be defended in Court.

Would be very interested in other opinions on this - should we be ammending claims to include 'bounce only' charges?

Best regards - Adam

Well this maybe useful, may not.
I have received 10 years worth of statements from ltsb.
Back in 1997 unauth'd O/D was charged at £6 now the same transgression costs £90 a mere 1400% increase.

Even if LTSB claim that the £6 was a one off as apposed to the £90 which is for 3 days then we are looking at £6 compared to £30, still 400% increase.

Curlyben,

I believe this type of historical info is extremely helpful, perhaps you could scan it and post same with names/addresses obliterated, also make available to EVIDENCE@consumeractiongr oup.co.uk.

Banks would rather die than reveal their true costs, so outsiders have to construct indirect evidence by inference. Price levels can be challenged in two ways:

1. It is above cost price contrary to Dunlop-v-Garage ruling. With banks refusing to reveal cost price, the more evidence is presented, the better a judge can decide on the balance of probabilities. If many objective signposts all point in the same direction, then the judge may allow in the absence of proof beyond a doubt that "this case has merit".

2. Supply of Goods and Service Act 1982 Section 15 - "Reasonable fee" question raised at Kevin's trial but not adequately answered.

Even allowing for a profit component inside a "service fee" the price is anti-competitive, and outlandishly higher than the Consumer Price Index rises, i.e. do UK banking charges reflect a true, free market? AIB which in its Dublin branch charges £3 for a bounce, in its UK branch charges £20, almost certainly carrying the same costs as in Dublin, using the same IT datastore. It could be libellous to suggest a price-fixing cartel in play, so far be it from me to suggest it. No, I have not said banks are operating a price-fixing cartel in the UK, perish the thought.

Consumer price inflation, 1947–2004 The National Office of Statistics says a shopping basket costing £18.30 in 1970 would have risen to £152 in 2004. We all know that banking operations, labour-intensive in 1970, have since become infinitely faster, sleeker and cheaper, employing fewer staff. Nevertheless if a bounce charge known to be £2 in 1970, rose at the same rate as household groceries, then by CPI it would have risen to £16.60 in 2004.

So where did the price of £39 come from?

Robdblynd,

Many thanks, I am sure many people would be interested and can use your link.

UK banks are one united monolith armed to the teeth, claimants are a spontaneous grassroots uprising, under-informed and under-equipped. All additional ammunition will help. In the absence of proof beyond a shadow of doubt, judges would give consideration to an aggregation of proof, each humble piece of information rowing its own weight.

The 2 Dublin banks T&C links:

http://www.accbank.ie/ul_fees_charges.html

http://www.aib.ie/servlet/ContentServer?pagename=RO IPersonalPortal/AIBContent_C/pp_article&c=AIBContent_C &cid=1136826345174&channe l=P001

Originally Posted by Robdblynd

http://www.consumeraction.org.au/downloads/DL56.pdf

Try that, it's where I got the dowload and have printed off to highlight relevant bits in case a bundle is really needed.

I've got CMC at Leeds Mercantile on 28th June so have been doing CMI sheet. got most of bundle ready to go but am going to include this report and the Irish one, and will definitely have these two as well.

As you say, every little bit helps.

Robdblynd,

Thanks ever so much, and best of luck in your court date. A man of your thoroughness ought to give them a drubbing.

Absolutely fab, all the more significant because this scholarly document was sponsored by the impartial Australian federal govenment.
For those not about to read through this 90-page pdf,

cheque bounce cost price in Aus was estimated at £1.50,

cheque bounce charge in Aus averaged at £15.

With IT costs comparable worldwide, UK costs ought to be in the same ballpark as £2. Aussie banks are greedy enough. UK banks appear to be more than twice as greedy.

This document was dated December 2004, hopefully someone with connections in Aus can update us, have those naughty banks stopped being naughty now?

Originally Posted by Robdblynd

http://www.consumeraction.org.au/downloads/DL56.pdf

Try that, it's where I got the dowload and have printed off to highlight relevant bits in case a bundle is really needed.

I've got CMC at Leeds Mercantile on 28th June so have been doing CMI sheet. got most of bundle ready to go but am going to include this report and the Irish one, and will definitely have these two as well.

As you say, every little bit helps.

Have you printed off ALL 40 sheets for your Court Bundle?? :o If so are you suggesting we all do this? :?

I have the two Irish T&C's - yes I had the same problem but managed to get the link to work in another thread Mistermind had posted on - I have my own T&C's plus the Morton one. I only printed off the two pages dipicting the costs.
Is there anything else I should include in my Court Bundle :-? ......................... ...............please. Thank you.

Amber, someone posted shareware on CAG which will convert acrobat .pdf to Word document, out of which cut-and-paste will be possible. I am sorry to disappoint you Amber, but the Aussie pdf is not 40 pages, but only 90 pages. Page 29 contains the Aussie charge prices, page 26 (I think) contains the Aussie cost price estimates. So only 2 pages of screen print will suffice, while providing the full Aussie link to convince any sceptic judge or bank defendant to view for himself.

I believe this Aussie report was probably used in Oxford Court, barcote v Egg hearing on 21st November 2006, and was ruled admissible by the judge (having been placed in the bundle?).

I am of the persuasion, that if you carry a kalashnikoff in one hand and a Rocket-propelled grenade in the other, neither needs be used as your opponent runs for the hills leaving a settlement sum behind.

Thanks Mistermind. Sorry I meant to type 90, goodness knows why I put 40 but there you are .

Pages 27 talks about the Wallis Report, P29 Oz fee charges and P31 talks about costs for charges re dishonoured cheques. I'll print out these three pages with a link to the whole article.

Your figure of speech bring a smile to my face .................
...............if you carry a kalashnikoff in one hand and a Rocket-propelled grenade in the other, neither needs be used as your opponent runs for the hills leaving a settlement sum behind................ .

Thanks for your help .

Hi

Have read this post with great interest. I have been trying to search on the net for archives and have come across some pages from a journal about Uk banking reforms.

I'ts just a thought but would it not be worth contacting somewhere like the London School of Economics where they might hold archives with the sort of data you are looking for?