Barclays Rubbish the 'Hardship Rule'

[TECHSPEC]

Barclays have told me that the hardship rule is being misrepresented by the media.

 

The rule does not oblige banks to deal with your case, but merely requests that they give you financial advice. Barclays do this in the form of a booklet.

 

This is certainly not what consumers were lead to believe. We were clearly told that the waiver would not be applied in cases of hardship.

 

Looks like we've been mislead.

[bruce47]

Techspace

 

If you have a claim for financial hardship and they have said this in reply to you. Then make a complaint to the FSA as they are not keeping to conditions of the waiver.

 

The waiver clearly states that banks must filter through hardhip cases and deal with them!!!

 

Again i would ask them for a copy of this booklet and also to put in writing what they are saying about the Hardship rule being misleading.

 

NO IF'S OR BUT'S, if this is what they are saying to you it is a LIE!!!!!

[alecmac18]

Don't let Barclays get away with it....the OFT have it on their website.

 

The Office of Fair Trading: Questions and answers for OFT test case announcement 26 July 2007 - updated 22 October 2007

[alecmac18]

From the OFT:

 

Under the conditions of the Waiver, amongst other things, banks must:

• not take the period during which the Waiver is in place into consideration in any decisions made about limitation periods or time limits for complaints
  
• not make materially adverse changes to the level of charges during the Waiver
  
• do all they can to help account holders avoid incurring these charges in the first place
  
• apply the relevant principle(s) established in the test case when dealing with complaints about charges, and
  
• continue to deal with genuine hardship cases during the Waiver period.

[smutley]

I agree, at my stay hearing, the Judge asked Barclays Solicitor for details on how they deal with hardship and she handed him the booklet and that was it.

[jansus]

From Natalie Bayliis FSA

In a letter to crfx

The two month review

 

We take the two month review of the waiververy seriously. We are gathering data from the banks for the purpose of the review and are liasingwith other bodies including the Banking Code Standards Board, the OFT, the FOS and a number of consumer groups. We are also considering information received from consumers about the banks' compliance with the conditions of the waiver. Where we consider it approriate, we are contacting banks to clarify information we have received about alleged breaches.

 

You say you have evidence that the conditionsof the waiver are being flouted. If you wish to send that evidence, we will be pleased to see it and will act on it accordingly.

[jansus]

I would go to the FSA web site and find the agreement the banks signed( the extract is on my thread in A&L thread in successes )

 

Also if you read the crfx thread on the judicial review the FSA have asked for cases to show that the banks have not "filtered" these cases through.

 

Also if you read the thread " annoyed from caerphilly" on A&L the "FOS " does not agree with that thinking.

 

On My thread in CAG suggestions and comments there are some interesting comments on how to define hardship.

 

sometimes ambiguous wording by these financial institutions gives them get out clauses:mad:

 

keep fighting An idea - any comments from mods and others?

 

 

 

 

Jan

[jansus]

Also I will ask crfx to raise these points with FSA on his return

[bruce47]

Funny enough a freind of mine has a work mate who has just got as response back from barclays i don't know him to well so couldn't really ask for a copy so i wrote down i paragraph which is very intresting

 

Quote

 

"i belive our obligations under the banking code may inadvertently have been misrepresented in the media and elsewhere. I apologise if you have received the impression that your financial hardship complaint is an alternative to your bank charges complaint as a methord of obtaining a refund of fees (and consiqently avoiding the current deferment arrangements)"

 

It also said "I wish to make it clear at the outset that you should not expect our proposals to include an offer of refund the bank charges you have incurred"

 

Then just dribbled on and said a member of the debt managment team will call him to see what the can do for him ie seeing CAB etc etc.

 

But looks like they are not going to be refunding any fees for financial hardship for anyone as this was a standard letter and i bet many Barclays members will be getting the same letters through now, it doesnt say its a final response but does say you can go to the ombudsman if you are not happy.

 

It will be nice to see when the OFT asks barclays how many financial hardship claims you have refunded and they say NONE!!!!

 

 

I Am sure what they are saying is a very strong statement as they are clearly saying they do not need to refund any charges because of financial hardship. So who is doing the misrepresentaition the Banks or the OFT????

 

If this is true then the waiver should not have included the financial hardship rule, it should of said they will still deal with hardship case's but will not have to refund any charges just pass you onto a debt management team member.

 

It will be intresting to see some views of the Alecm?? sorry bud, and CRFX250 etc on this

 

I told him to go to the ombudsman and also make a complaint to the FSA.

[alecmac18]

I've recieved a few of these so here goes..........

 

As far as I'm aware Barclays is the first bank (and the only one so far) to take the route less travelled and deny all claims for financial hardship outright.

 

There are two ways of looking at the obligations of the banks regarding financial hardship. Barclays are taking the view that the financial hardship clause was mentioned by the FSA as guidance and not direction. This is important as guidance is totally voluntary wereas directions are mandatory. However Barclays have taken the view that all they have to do is send an income/expenditure statement to clients along with a leaflet. This is added to the fact that they can not possibly have looked at every case on an individual basis because they have sent them all the same response. The next stage now for all Barclays customers claiming hardship is to appeal to the FOS immediately and get a definative ruling on the issue. As yet the FOS has been very cagey on the issue and says it will look at all cases on their merits.

 

The issue is further muddied by the fact that the OFT has issued public statements on the hardship issue.

 

 

 

Bottom line: If you are suffering from financial hardship AS A DIRECT RESULT of bank penalty charges then you should be contacting the FOS immediately with your case. You would do well to write the words FINANCIAL HARDSHIP CLAIM in red pen accross the top of your letter to make sure that it is filtered from the rest.

 

Barclays are techincially correct (the best kind of correct for banks and civil servants) but I believe their stance goes against the sprit and original intention of the guidance (otherwise why include it - banks already have a mandate to help customers who are in financial difficulty with debts)

 

So the next stage is a FOS ruling..................watch this space.

 

I would like to add: There have been many people who have won cases (where financial hardship was clearly caused by bank charges) where they had clearly been robbed blind by their banks............so some banks are paying out..............Not all banks have taken Barclays stance.

[alecmac18]

Look at this statement by the OFT on the Q&A section of their website:

 

Under the conditions of the Waiver, amongst other things, banks must:

• not take the period during which the Waiver is in place into consideration in any decisions made about limitation periods or time limits for complaints
  
• not make materially adverse changes to the level of charges during the Waiver
  
• do all they can to help account holders avoid incurring these charges in the first place
  
• apply the relevant principle(s) established in the test case when dealing with complaints about charges, and
  
• continue to deal with genuine hardship cases during the Waiver period.

CONTINUE TO DEAL WITH GENUINE HARDSHIP CASES DURING THE WAIVER PERIOD.

 

There it is in black and white. I suppose it boils down to your definition of 'deal'. But the obvious meaning is clear........it means pay up.

 

 

The Office of Fair Trading: Questions and answers for OFT test case announcement 26 July 2007 - updated 22 October 2007

[alecmac18]

The worst part about the whole hardship thing is that the people who actually have a valid claim for financial hardship really, really need the money back and it is clear from looking at these claims that the banks have literally been robbing these customers.

 

I have personally seen a case where a client had over £12k of charges over a 6 year period. Their financial position had deterioriated rapidly over the years and it is directly related to bank charges. She was left with no money to eat, feed kids, rent etc......she is currently facing eviction. This is the sad reality behind bank charges.......people are actually suffering out there.....big time........and its wrong.........and save for Martin Lewis and CAG very few people in government, at banks and regulators seem to care. Most people dont give a stuff about the OFT case.........but they know right and wrong......and they know its wrong for the Banks to allow themselevs to plunder their account. Hell - at the moment they cant even claim them back! And the worst thing is that these charges hit people at their worst........when they have literally run out of money completely.

 

I shed a tear for the state of this Country.

 

Banks have the duty under principle 10 of high level FSA regs to:

 

10. Clients’ assets - A firm must arrange adequate protection for clients’ assets when it is responsible for them.

 

 

Do you think this bank was following that rule?

 

 

Firms must also:

 

6. Customers’ interests - A firm must pay due regard to the interests of its customers and treat them fairly.

 

9. Customers: relationships of trust - A firm must take reasonable care to ensure the suitability of its advice and discretionary decisions for any customer who is entitled to rely upon its judgement.

 

2. Skill, care and diligence - A firm must conduct its business with due skill, care and diligence.

 

7. Communications with clients - A firm must pay due regard to the information needs of its clients and communicate information to them in a way which is clear, fair and not misleading.

 

 

Now you may think that the banks don't really follow these principles of business and you would be right, but there is one which they adhere to on pain of death.........can you guess.........ok here it is.......

 

11. Relations with regulators - A firm must deal with its regulators in an open and co-operative way and must disclose to the FSA anything relating to the firm of which the FSA would reasonably expect notice.

 

 

Rule number 12 is ignore everything except rule 11.

[jansus]

Thank you for your interesting posts

 

The ambiguous wording of the agreement is obviously open to misinterpretation and that is why I think we should be sending these comments to the FSA and FOS asap.

 

Obviously some courts read this the same way that we have in that hardship cases should be "filtered through" - ok if it did not mean refunding the charges - what did it mean?

 

At least if on those peoples accounts the charges and debt chasing was frozen - surely that would have been of some assistance?

 

Any volunteers to do a letter on behalf of CAG - to sort this out?

 

And why did the FOS help the A&L case if the comments from Barclays are true?

 

Jan

[alecmac18]

My message to Barclays customers following this stance would be to immediately close your account and move elsewhere. A bank which rejects regulations on the sheer scale that Barclays does can no longer be trusted to look after your money.

[jansus]

HERE IS A NEWSPAPER REPORT FROM DEVON ON A RECENT CASE

 

CLAIRE TO FIGHT ON IN BANK CHARGES ROW

3 readers have commented on this story. Click here to read their views.

11:00 - 02 November 2007

A paignton mum has lost the latest round of her David and Goliath court battle with one of the biggest banks in Britain.

 

Claire Gardiner was due to have her case against charges imposed by NatWest heard at Torquay County Court, but a judge ruled that proceedings should be put on hold until a national test case is concluded next year.The 34-year-old from Queen Elizabeth Drive is hoping to reclaim £4,848 in bank charges, plus interest, from NatWest.

 

Her case is one of many thousands across the country in which customers claim the banks imposed unfair charges on them.

 

But the consumer-driven revolt against bank penalty charges has been largely halted because of the test case being brought by the Office of Fair Trading against seven banks and a building society at the High Court in January 2008.

 

Mrs Gardiner, who works part-time as a cleaner, believed her case against NatWest should have been processed early and argued 'severe hardship'.

 

She argued the banks should not have been able to take the money as it was social security benefits paid to her by the Government to help look after her children.

 

And the 'stay' had been lifted for the case to go ahead but NatWest successfully applied to have it reinstated and therefore halted the Torquay proceedings.

 

Judge Bernice Meredith ruled Mrs Gardiner should wait until the test case because the likelihood was that the bank would appeal should she win, and the money would not be handed back to her until the appeal was resolved, if at all.

 

If she did not win, and the Office of Fair Trading case was successful, then Mrs Gardiner would have lost out.

 

Solicitor George McPherson, on behalf of NatWest, told the judge Mrs Gardiner wanted £4,848 bank charges back from the bank plus £838 interest.

 

He said: "There's no reason why the claimant shouldn't wait until after the test case. The bank says she will benefit from the delay.

 

"A stay is in accordance with dealing with the case justly. We say she is not going to suffer any financial hardship."

 

In the hearing, Mrs Gardiner said the only option she was given by the bank to repay her charges and get her out of her overdraft was to take out a loan, which in turn led to more charges.

 

She told the judge: "It's a situation which I find frankly disgraceful. I made a mistake by going over my overdraft limit but what we are arguing is that the price the banks are charging is not relevant to the actual cost to the bank.

 

"If you are on a low income then that initial small charge snowballs. A large proportion of what I'm claiming has been taken out of benefits money and the Office of Fair Trading test case isn't going to address that issue."

 

Judge Meredith said: "It's not going to avail the claimant of anything if the case goes ahead. In general terms it's more to her advantage for the case to wait until the outcome of the Office of Fair Trading test case.

 

"The hardship argument doesn't work because it's pre-supposing you're going to win."

 

Mrs Gardiner, who acted as a 'litigant in person' by representing herself, was praised for preparing her case well and thoroughly.

 

But Judge Meredith said the claim should have been made on the grounds of her benefits being unfairly taken from her account, which she felt wasn't clear enough in the legal documents.

 

After the preliminary hearing, Mrs Gardiner declared: "I'm not beaten yet. I'm going to amend the particulars of my claim then take the whole situation to the Financial Ombudsman Service."

 

She hopes the ombudsman will uphold her case as one of 'genuine hardship', which are meant to be exempt from the waiver granted by the Financial Services Authority to banks until the test case is resolved. She claims to be such a case because her husband Mark broke his ankle in February and subsequently lost his job as a tyre and exhaust fitter.

[setmefree]

Oh dear oh dear Barclay's,looking at your shares thing's ain't too clever for you, but i'm sure You can apply to the Bank of England for Hardship funding.

One rule for one and one for another.

[setmefree]

And their shares are still dropping lmfao, how the mighty fall:D