BBC: OFT revises bank charge guidance

[alecmac18]

Just saw this on the Beeb site, can anyone explain this............

 

BBC NEWS | Business | OFT revises bank charge guidance

[alecmac18]

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

 

This is the Q&A section the article refers to:

[brown1950]

I can smell a deal in the pipeline ! Banks will not want full disclosure of their costs therefore I can see a deal being done of say max £10.00 for 'bounced' cheque etc and in return banks will have to refund all excess charges over the agreed amounts going back 6 years ! We can only live in hope !

[alecmac18]

I think you are right. The OFT and the FSA have both taken a battering over this (reputationally). The venom directed at them has been intense - I really don't think they expected it.

 

I reckon the climbdown will come when the FSA 'amends' the waiver to allow banks to offer settlements to clients again. Personally I don't see the problem with a banks making offers to people to settle in advance of judgement. The original agrument was that the waiver was put in place because people were having wildly differing results when claiming back their charges.......but a lot of people would rather have the choice of accepting something rather than holding on until all the legal issues have been resolved. Of course some people would rather hold on for the full amount and that fine as well. Point is if banks actually WANT to make offers and customers actually WANT to accept them why should the FSA be standing in the way holding a waiver? The big problem is that under the current waiver the banks cannot make 'full and final' settlements'. Curently there is no incentive for a bank to settle as they may have to pay an additional sum at a later date depending on the outcome of the test case.

 

Wierdly banks would actually LIKE to settle - but there is currently no compelling reason for them to do so. If they were allowed to go back to making offers the postman would not be able to move for all the cheques they would be sending out. The banks want this to go away - and they dont really mind paying - but they do want the ability to charge similar fees in the future (even if they are capped at a lower level) and they also want to know that when they do start paying out claims it will put the matter to rest for good.

[rockinrodders]

Everytime I think about it it makes me feel more like a stitch up. The OFT and the Banks will agree on a deal. And I bet that deal will be a limit to the amount of the charge (e.g £12 like credit cards) but they will waive the consumers right to claim existing charges. Therefore crushing all our claims and only enforcing it going forward

 

Since when has any government body worked for the good of the people?

 

exactly, never

[bruce47]

Yes it is a good possibility but i think it is more to do with the defence entered by the banks as it was only after the defence was submitted they changed the POC's.

 

When you read the first POC's then 1 of the banks defence as they are all similar then read the new POC's you can see a strong maybe aggresive tone in the new POC's, which is good for us as it shows that maybe they are on our side!!!

 

I think the next important step is when the OFT publish its findings in December and just hope they do not delay it again!!.

 

Then the balls over in the banks court and hopefuly they will of already planned a way out agreeing a lower charge.

 

It also seems that the test case in Jan is just phase 1 so they will be setting anther court date after this to find out if the charges are a penalty or not. So it looks like the waiver will still be in place even if the OFT wins phase 1 of the court case.

 

But yes hopefully the banks will come to an agreement with the OFT before the end of the year!!!!!

[podgydad]

I would have thought that if the OFT win round 1 in January the FSA will come under increasing pressure to lift the waiver.

[Lula]

Even if there is a deal done, I am pretty sure that we can still continue to court with our claims as the OFT do not make the law and there will still be the issue of the UTCCR, which will not go away until there is a ruling from a Mercatile/High Court

[Gez]

I can smell a deal in the pipeline ! Banks will not want full disclosure of their costs therefore I can see a deal being done of say max £10.00 for 'bounced' cheque etc and in return banks will have to refund all excess charges over the agreed amounts going back 6 years ! We can only live in hope !

 

You could still reasonably argue in court that you should only pay the 1st charge that was made if a £10 cap was introduced. If the bank hadn't charged you more than they should in the first place, subsequent charges would not have happened.

 

The OFT really only has one decision to make, push to stop penalty charges once & for all, or do a deal which would resolve nothing and show them to be completely useless & anti-consumer.