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Which? and the OFT and the forthcoming announcement on bank charges


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Apologies if this information is incorrect; I receieved it second hand from my Dad. I am not in the habit of listening to Radio 5 at 6.30 on a Sunday Morning!

 

According to my Dad, a guy from Which? was on Radio 5 this morning talking about Bank Charges and how they are illegal. I have tried to listen to the show again but it is not yet available on the net; I guess it will be 24 hours after broadcast. The link for the show is

 

http://www.bbc.co.uk/fivelive/programmes/breakfast.shtml

 

And there is a link on that page, towards the top, to "Listen Again".

 

Also, the guy from Which? mentioned the Which? website to do with bank charges. I would be surprised if this hadn't already been posted to the forums, but just in case:

 

http://www.which.net/campaigns/personalfinance/bankingcharges/index.html

 

EDIT:

 

My Dad has just phoned me up again (it's like having my own researcher!) to point me at an article in today's Sunday Telegraph:

 

"Money and Jobs" Section, page 3, "Fight Back Against The Banks": full page article about all of this. It also mentions the guy at Which? who is chasing all of this up; his name is Doug Taylor.

 

Please let me know if you want the full Telegraph article posted - or any other articles from any newspaper back issues: I get access to an online catalogue of newspapers through my university.

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starts at 1:08.45 into the programme

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Please let me know if you want the full Telegraph article posted - or any other articles from any newspaper back issues: I get access to an online catalogue of newspapers through my university.

 

Yes, please.

 

Thanks for the tip about the programme - it's up there now, as BF's post shows.

 

(in truth, I'm a bit annoyed that Which! have come into the game so late, and will probably walk away with all the credit when the banks are foced to give in. Still, if it means no more charges, then I suppose it doesn't matter how it came about.)

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I've listened to the programme now and also gone through the Which? website which gives step-by-step instructions as to how to reclaim your charges. They also provide template letters.

 

Firstly it is vey good to see that this vey important consumer group has finally come out very firmly against bank charges and has even now stated that they are unlawful and even goes as far as to recommend legal action.

 

However there are a lot of problems with the advice they give and with the templates which they provide on their website.

 

The DPA letter does not refer to the £10 fee and there is no encouragement to send it with the request. However, we are finding that there is sometimes quite obstructive behaviour from the banks about disclosure and it seems to us that it is prudent to send the money with the request as this removes from the bank any good reason for failing to comply.

 

The Which? website encourages a far greater attempt to try and have dialogue with the bank than we do here. This is because we have found that the banks are not interested in dialogue and that they rebuff all attempts to deal with the issue.

 

The Which? letters are not, in my view, pointed enough. They do not set targets for action even though it is clear that when left to their own devices the banks will either set unreasonably long timescales or not respond at all. The Which? letters do not empower the customer and do not allow the customer to take control.

 

One of the Which? templates even tries to use the previous good conduct of the account as part of the bargaining counter. This is an extremely unfortunate approach to take. It encourages the culture which the banks have nurtured for many years that if you have not conducted your account properly that you then lose leverage over the bank and that maybe you are not even entitled to the protection of the law relating to penalty clauses in contract. It is a great shame that a respected, well established body like Which? should do this. It is contrary to the notion of the Consumer Right. It undermines the Consumer's self-confidence; in particular it undermines the confidence of vulnerable disprivileged consumers who are very much more likely not to have conducted their accounts at all well and who will always be the far more hard-hit of the banks' victims.

 

Which suggests the possibility of accepting a reduced payment as a compromise solution to the dispute. Of course this is not a bad suggestion for people who maybe do not have the confidence to go as far as a court action. However, I do not think that Which? makes it clear enough that the customer does not have to do this and that they can go ahead and insist on full settlement if the wish.

 

In their advice about taking a court action Which? makes the assertion that a judge is much more likley to look favourably on your case if the customer has conducted his account generally in a good way and that if the customer has conducted their account badly over a more extended period of time, they are less likely to succeed if they later should go to trial.

 

You are more likely to succeed if the amount of your unauthorised

overdraft is small and you rarely exceed your authorised overdraft

limit

> You are less likely to succeed if you exceed your authorised

overdraft limit by a large amount and you frequently do this.

 

source:- http://www.which.net/campaigns/personalfinance/bankingcharges/smallclaimscourt.pdf

This is a frankly shocking thing to say. It suggests that a customer is deserving of unlawful charges if they frequently breach their current account contract and they they do not deserve them if they geneally conduct their account correctly.

 

More seriously it suggests very strongly that the judges will also take this view and that the role of the judiciary is to associate themselves with a some "punitive" function of our civil justice system of which I am not aware and that they will assist the banks in disciplining the customer where needs be.

 

This is completely untrue. If you case gets to court it will be decided on the merits of your argument and on the law of penalties. All claimants will be treated equally and their previous conduct of their bank account will not be relevant to the outcome of the case. I imagine that any judge who saw this comment would be quite indignant about it.

 

My conclusions are that I smell a very fishy odour in the politico/banking atmosphere.

 

The OFT is due to make an announcement soon and the rumour is that they will recommend a cap to charges. This means that they will not be condemning illegal charges by the banks and their statement may even come with a warning about responsible conduct by bank customers.

 

Which? after years of remaining largely silent and non-committed about the porblem of charges has suddenly set out its stall.

 

I am quite satisfied in my mind that an organisation such as Which? works closely with the OFT and knows exactly what the forthcoming announcement will be.

 

It will be no surprise to me if the OFT announcement is completely compaible with Which?'s new campaign.

 

My sense is that the cooks are gathering and that the bank customer is, as we speak, being buttered up, trussed up and stuffed up, ready for the oven.

 

But there is always The Consumer Action Group, isn't there boys and girls?

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(in truth, I'm a bit annoyed that Which! have come into the game so late, and will probably walk away with all the credit when the banks are foced to give in. Still, if it means no more charges, then I suppose it doesn't matter how it came about.)

 

Don't worry. There is no credit to Which?'s campaign. It might almost have been designed by a banker.

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(in truth, I'm a bit annoyed that Which! have come into the game so late, and will probably walk away with all the credit when the banks are foced to give in. Still, if it means no more charges, then I suppose it doesn't matter how it came about.)

 

Yeah, there's a small folllowup to last month's request on p8 (Inside Story) of this month's edition - entitled "Which? challenges big banks" - and they've added this to their site. I'm also in contact with one of their researchers over my A&L case, and I've made it clear that the groundswell of public uproar comes from sites like this. Annoying how they jump on the bandwagon and don't focus on the (il)legalities of the charges! :mad:

 

Cheers

 

Michael

Please note that the right to reproduce any part of any post I make on this forum is restricted under copyright law.

 

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"You are more likely to succeed if the amount of your unauthorised

overdraft is small and you rarely exceed your authorised overdraft

limit

> You are less likely to succeed if you exceed your authorised

overdraft limit by a large amount and you frequently do this."

 

You really have to ask where this idea actually comes from.

 

It bears no relationship to the law. Just as importantly it bears no relationship to what is actually happening. Given that there has only been one case that has actually reached court and now dozens or scores that have been settled by scared banks out of court, it's hard to see where Which? get this idea.

 

It sounds like something that a politician might say in justifying the capped charges that the OFT is looking to recommend.

 

One also has to ask what is the purpose of Which? Nowadays it seems to be a little more than a product test lab more than a campaigning organisation. It turns over more than £50m a year, has more than £30m in reserves but it seems to have minimal public impact. If it turns out that the OFT recommendations and the politician and bankers spin on them dovetail nicely with the Which? "campaign" then it does rather lead to an unfortunate conclusion.

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What a coincidence. Forthcoming OFT announcement, The Which? campaign - and now .....

A new Banking Code!

 

A new Banking Code is to be released containing revisions of the provisions to do with fairness to customers.

 

All of these things happening at the same time. Isn't that odd.

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All that now needs to happen is that the OFT's announcement will seek to close off customers' legal options and we will all get to see up close and personal just how this country now operates.

 

The OFT's catchline is that they are "making markets work well for consumers". The British Bankers Association sets codes which "allow competition and market forces to work to encourage higher standards for the benefit of customers". Which? provides "Expert advice from an independent source".

 

If the result of all this is that the OFT suggests a capped charge of £15, the BBA talk about charges being fairly levied and Which? argue that only those who have been good boys and girls should be able to reclaim charges, then the crying need for this campaign to contine will be obvious to all.

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Whilst I agree that the arguments and positions set out by Which? are quite weak and very watery, they nevertheless present an air of authority to your Joe Average on the street. The overall message is that banks have been charging way too much over the years, and that there is now good cause to bring the banks into line.

 

The banks will have to come clean about this one way or another, and whilst they are clearly working with OFT and Which?, to most people all actions by the banks will be viewed with suspicion. I would say that in achieveing this, Which? deserve 6/10.

 

However, as BAG continues, and people get to hear that others are getting back all their money, and this whilst having a 'badly run' account, more people will start to push the Which? position, and a follow up 'programme' may be encouraged to take a stronger stand. The issue of bank charges is now in the open, and it can not be put back in the cupboard again. Things can only get better from this point...

Alecto, Magaera et Tisiphone: Nemesis on Earth is come.

 

All advice and opinions given by Spiceskull are personal, and are not endorsed by Consumer Action Group or Bank Action Group. Your decisions and actions are your own, and should you be in any doubt, you are advised to seek the opinion of a qualified professional.

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You have a far too high opinion of Joe Average.

 

Joe Average is a sheep. Once Which!, the BBA and the OFT come up with a "reasonable" amount, he will think that it is so, and will not look any further.

He will still grumble that it's a lot, but hey, he should have been more careful with his money, shouldn't he? And after all, it is his fault, so he should be punished, right? Even Which! says so!

 

We're being sold down the river by the very people who are meant to protect us... Soon, the word "fiduciary" will be relegated to the Well of Lost Plots...:(

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The real question is whether this will actually have any effect on the cases going to court. If it does then the banks and the OFT will have contrived to create a class of penalty charges that are treated completely differently from any others. I don't see that happening myself and this carefully contructed house of straw is likely to be blown down with the first puff of wind.

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You both make valid points, and I agree with Seminole, there is a chance that this may work backwards. However, I don't see how it can be lawfully argued in a court...'yer honour, we didn't like what the claimant was doing, so we moved the goalposts...and look, it's all 'official' now...'

 

But BW - I don't have a high opinion of Joe Average...but I believe that even Joe Average has a right to know, and what Which? has done is made (some of it) available to Joe Average.

 

If Joe can't work it out from there, or cannot ask more questions, then so be it. But I know a few Joes who only need that little kick up the butt to press them into action...I think Joe will come through in the end...

Alecto, Magaera et Tisiphone: Nemesis on Earth is come.

 

All advice and opinions given by Spiceskull are personal, and are not endorsed by Consumer Action Group or Bank Action Group. Your decisions and actions are your own, and should you be in any doubt, you are advised to seek the opinion of a qualified professional.

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Do you think there might be any implications from this an announcement in respect to our up and coming claims?

If you find this post useful, please click the Scales of 'Justice' in the top right corner. Thanks ;)

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I think Joe will come through in the end...

 

Awww, you sweet romantic thing, you... I used to have faith in my fellow human beings too, once *sigh*...

 

(Actually, just the once, then the bstrd kicked me in the teeth:D )

 

We'll see. Incidentally, I completely agree about the right to know, don't get me wrong. I'm just more cynical about the impact.

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  • 12 years later...

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