H.O.L Test case appeal. Judgement Declared. ***See Announcements***

[yourbank]

Jotty, read the announcement on CAG re "The government wants the OFT test case over". Its from a government white paper(so realistically its a worthless piece of government bumph) but has a very good summary of the OFT test case and the fact that the House of Lords result is the half way mark.

http://www.consumeractiongroup.co.uk/forum/announcement.php?f=91&a=158

Link above, ignore the bold which isn't in the original.

 

The thread title will change as we continue this process on. Hope that helps and must be worth a click of the scales by all of you reading this post

[Conniff]

Oops sorry - that's off topic.

[yourbank]

Oops sorry - that's off topic.

NOOooooooooooooooooooooooooooooooooooooooooooooo!

 

Sorry, house of Lords, wigs, new constitutional court(no one mentioned too much about that:p) and bank charges.

Is that on topic now?

[Conniff]

The thing is, there is so much time to wait and not the information to talk about until something substantial comes out of the HOL (that's not short for holiday so is on topic), the space has to be filled with snippets of information on what 'has' happened and that will include other cases on banking and other services in the banking industry.

[car2403]

Ok, fair dos then, Site rules forbids me from linking(and permission to reproduce them here was not given due to the time and effort it took to get them) so I'll be a liar here and truthful elsewhere. I can live with that.

 

Shall we move on since the info was on credit cards and not bank charges so is technically off topic.

 

I could well be wrong, here, (ok, ok, it's happened once before!) but I don't believe any such permission has been sought, or indeed denied, by site admin.

 

I'm sure an email to [email protected] will clear up any confusion, however, YB.

 

;-)

[yourbank]

Misunderstanding...

Edited July 15, 2009 by yourbank

[Bookworm]

I could well be wrong, here, (ok, ok, it's happened once before!) but I don't believe any such permission has been sought, or indeed denied, by site admin.

Not permission from this side, Car. What YB is making out is that getting the info was such hard work that "they" won't allow for it to be published here, (which is fair enough), and of course, he knows very well why links are not allowed... Still, with a bit of luck, the baiting might help tease a few people to go and check it out elsewhere, thus creating at least some traffic...

[yourbank]

The Consumer Forums - Announcements in Forum : Welcome to the Consumer Forums

 

I think anyone wanting to know what is happening and may happen in the OFT test case needs to read the forum announcement. It is literally a dummies guide and it stands today as to what is currently happening and the next stage. One of these very few times when I think the Government has published something worth reading this year.

[d1cky]

so......... whats everyone had for dinner tonight...?

[Conniff]

I posted this a while ago and it might be prudent to post it again:

 

"This problem arises from the banks using poverty as a source of profit, a great deal of profit. The bank commission of BBC 2's "The Money Programme", which included eminent business academics and a former senior NatWest executive, concluded that the absolute maximum administrative cost to a bank of processing a bounced cheque, the most labour-intensive of the processes in question, is £4.50. For all other items, such as unauthorised overdrafts or bounced direct debits, the commission concluded that the absolute maximum, in this electronic age where everything is done automatically through a computer, is £2.50. However, the average charge is approximately £30. Some are as high as £38, and they are charged every time people make what the banks consider to be an unauthorised transaction. That is a substantial profit for the banks, which rake in some £4.5 billion

[InformedSearcher]

I posted this a while ago and it might be prudent to post it again:

 

Thank you for that - just goes to show eh? However actually ask 'any' bank employee if they consider these charges to be excessive and the real training shows immediately by the answer 'Yes I do'. Personally I smile when I hear that because you can tell by the voice of their level of conviction of answer. Remember when they 'run out of steam' it's back to 'In the Terms & Conditions'. So strange though that when you enter into the agreements you get told all the positive things about this and that but 'never' what happens when you lose your job or other reasons and the consequences of that.

I hope I was not too far off topic with this but it is related and certainly what we here have at some time experienced aboout the grossly unfair manner in the way banks 'alledgely extract/steal' from the 'needy'.

 

Oh I had a McDonalds this evening, a very nice Chicken Legend (as I just had to reply)! LOL

Michael

[Aequitas]

However actually ask 'any' bank employee if they consider these charges to be excessive and the real training shows immediately by the answer 'Yes I do'.

 

The question of whether bank charges are excessive or disproportionate to the cost incurred by the banks (which undoubtedly they are) is a red herring when considering whether or not the UTCCR apply to them. The sole question is: is any particular charge (however much it is) intrinsically unfair? If the answer is "yes" then the charge is unfair and cannot be levied. If the answer is "no" then the charge can be levied and no enquiry may be raised as to the amount so long as the term is couched in plain intelligible language. I think that the Foxton's case has confirmed this principle.

 

There are no laws which allow the courts to determine how much profit a business should make.

 

A separate issue is whether the way banks apply their charges is fair, especially the way charges are allowed to generate further charges. By concentrating too much on whether charges are in themselves unfair, this aspect is being rather overlooked. It is the banks' practices in this regard that cause people real problems. What is needed is a rule that says that in determining whether an account is in the red (and accordingly whether charges can be raised) any charges debited are too be disregarded.

[kennyh]

The sole question is: is any particular charge (however much it is) intrinsically unfair? If the answer is "yes" then the charge is unfair and cannot be levied. If the answer is "no" then the charge can be levied and no enquiry may be raised as to the amount so long as the term is couched in plain intelligible language

OK folks - AND the answer is???

[London000]

 

There are no laws which allow the courts to determine how much profit a business should make.

 

 

Hi there,

Sorry to hop in...

I am rather amazed that the banks are to be called a business ..on the poor people's shoulders. Not to mention that the banks shoud be more than happy that we keep our money with them....as if we were chinese we all should keep all our cash in our pockets, houses or elswhere.

Banks think they rule the people...well soon they will learn that people are not as stupid as they think.... If the trust is gone, then everything else falls apart....Even if they win over all these rubish charges and credit agreements what banks really lost is their customers.

I have been in management years and I have learnt a lot of things; one of them is:

Customers do not complaint, they just go elsewhere!

I would have to add that if the customers are complaining, then banks should be more than happy as managers would have something to repair into their system, not to fire, lie and steal from their own customers.

When I was a child I was told that if one person is complaining of anything you should not worry that much ....but where are more (just like all of us - millions) then something is wrong and needs to be corected straight away..

DD

[jansus]

The question of whether bank charges are excessive or disproportionate to the cost incurred by the banks (which undoubtedly they are) is a red herring when considering whether or not the UTCCR apply to them. The sole question is: is any particular charge (however much it is) intrinsically unfair? If the answer is "yes" then the charge is unfair and cannot be levied. If the answer is "no" then the charge can be levied and no enquiry may be raised as to the amount so long as the term is couched in plain intelligible language. I think that the Foxton's case has confirmed this principle.

 

There are no laws which allow the courts to determine how much profit a business should make.

 

A separate issue is whether the way banks apply their charges is fair, especially the way charges are allowed to generate further charges. By concentrating too much on whether charges are in themselves unfair, this aspect is being rather overlooked. It is the banks' practices in this regard that cause people real problems. What is needed is a rule that says that in determining whether an account is in the red (and accordingly whether charges can be raised) any charges debited are too be disregarded.

 

 

So you are saying there is a possiblity that ,if it is decided that the banks should be allowed to charge for the extra work involved in bouncing a direct debit or writing a letter to tell the customer they are over their OD limit - then they could increase the charge to whatever they liked as long as the "competition" did the same (not that I am suggesting there is a cartel or anything).

 

I agree with your second paragraph completely - especially for those on low incomes and benefits which is why I have always argued against those who just think it is a simple matter of not going OD in the first place. Unfortunately I think some of them may now regret this argument as they may themselves have fallen on hard times and be experiencing the pain of these acculmulating charges themselves.

 

 

Also I wonder if the government are now regretting investing taxpayers money in the banks who have admitted in court that part of their business plan is to rely on a large proportion of the british public being OD on their accounts to provide a "main income stream"

 

Thats a bit like me saying I will charge all my customers paying me late and then rely on those charges in my annual budget figures to determine my future business plan?

[jansus]

Hi there,

Sorry to hop in...

I am rather amazed that the banks are to be called a business ..on the poor people's shoulders. Not to mention that the banks shoud be more than happy that we keep our money with them....as if we were chinese we all should keep all our cash in our pockets, houses or elswhere.

Banks think they rule the people...well soon they will learn that people are not as stupid as they think.... If the trust is gone, then everything else falls apart....Even if they win over all these rubish charges and credit agreements what banks really lost is their customers.

I have been in management years and I have learnt a lot of things; one of them is:

Customers do not complaint, they just go elsewhere!

I would have to add that if the customers are complaining, then banks should be more than happy as managers would have something to repair into their system, not to fire, lie and steal from their own customers.

When I was a child I was told that if one person is complaining of anything you should not worry that much ....but where are more (just like all of us - millions) then something is wrong and needs to be corected straight away..

DD

 

 

 

I agree and thats why I think credit union accounts should be encouraged but for the majority of customers until one bank steps up and thinks of a better way to deal with the situation of OD and DD we are a bit stuck.

[djgordyp]

I'm with jansus re. credit unions. For DD's we could use a pre-paid debit card. The one I have charges 3% if topping up via a paypoint and you can't go overdrawn. I have to say I haven't checked if these cards allow DD but I'm sure they probably would.

[Aequitas]

I am rather amazed that the banks are to be called a business ..on the poor people's shoulders etc

 

With respect you are getting carried away with rhetoric. No court is going to say a bank is not a business. I am trying to focus people's minds on the narrow legal issues which is what the court will decide. What you say about the banks is true of many businesses. Many businesses are as bad, if not worse than, the banks. Half the stuff you buy in shops is made in SE Asian sweat shops and manufactured at a fraction of the price it is sold for on the high street. Yet no one is arguing it is unfair to sell trainers for eighty pounds when they cost less than a pound to make.

[Aequitas]

So you are saying there is a possiblity that ,if it is decided that the banks should be allowed to charge for the extra work involved in bouncing a direct debit or writing a letter to tell the customer they are over their OD limit - then they could increase the charge to whatever they liked as long as the "competition" did the same (not that I am suggesting there is a cartel or anything).

 

I am not saying that at all.

[yourbank]

Thank you for that - just goes to show eh? However actually ask 'any' bank employee if they consider these charges to be excessive and the real training shows immediately by the answer 'Yes I do'.

For 5 years in retail banking, I didn't even consider the element of price on charges. I believed the bank had the right to levy charges and I believed that educating people on how the charges worked would stop them incurring them in the future. To a degree that is the same attitude today, educating people rather than using the brain to understand that they are not. Do as you are told because your opinion is irrelevant to the corporate opinion. Things changed in 2006 for me and my eyes were opened.

 

Personally I smile when I hear that because you can tell by the voice of their level of conviction of answer. Remember when they 'run out of steam' it's back to 'In the Terms & Conditions'. So strange though that when you enter into the agreements you get told all the positive things about this and that but 'never' what happens when you lose your job or other reasons and the consequences of that.

I have never entered into any agreements with the attitude that I will lose my job or my personal circumstances would get worse rather than better.

 

I hope I was not too far off topic with this but it is related and certainly what we here have at some time experienced aboout the grossly unfair manner in the way banks 'alledgely extract/steal' from the 'needy'.

 

It's the way the interplay of charges work, and I agree with you that normally it is those who can least afford it get hit a lot. However, that is not to say that the wealthy remain in credit, because that is unusual, in fact many wealthy people run their accounts in debit because they have no sense of any money.

 

Oh I had a McDonalds this evening, a very nice Chicken Legend (as I just had to reply)! LOL

Michael

 

Gotta say "Super Size me" put me off that kinda fast food but I am partial to a curry/chinese takeaway or Fish and Chips...hmmmmmm

[jansus]

I am not saying that at all.

 

 

Not inferring they would - but in legal terms if the charges are not unfair then in theory they could? Is that not what your argument is ? If the charge is fair in principle it does not matter about the amount?If the market could withstand it they could charge more?

 

Or am I not understanding your very interesting post.

[Aequitas]

If the charge is fair in principle it does not matter about the amount?

 

Yes.

 

If the market could withstand it they could charge more?

 

Exactly. Just like the price of anything. Now of course in practice banks rely on customer inertia. It is much more trouble to change banks than to change supermarkets and in any event one bank is just like another for personal current accounts - if there are differences it tends to be swings and roundabouts. This is what keeps the prices high. If a bank broke ranks and everyone started to flock to it the others would have to reduce their charges.

[jansus]

thank you for that.

An explanation in PIL

 

lets hope the way the charges is applied is examined as for those on low incomes that is where the spiral of problems starts. I for one am closing my account as a protest but agree the alternatives are hard to track down.

[yourbank]

No decision will be made until at least October, thought you might like to know the good news before the holidays

[**Tilly**]

BBC NEWS | Business | Bank charges complaints delayed