Banks struck secret deal with FOS

[grimbell]

http://www.mirror.co.uk/news/money/c...9520-19783290/

[iancognito]

Re: Banks struck secret deal with FOS

Stitch up!

EXCLUSIVE Banks' secret deal with ombudsman to stop probe into their rip-off charges

13/09/2007

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Banks struck a secret deal to prevent a probe into their rip-off charges by agreeing to repay customers' complaints in full.
The agreement meant that anyone who complained to the independent Financial Ombudsman Service would get all their overdraft charges refunded.
In exchange, the ombudsman agreed not to investigate whether the fees were fair. This prevented it from clashing with an Office of Fair Trading probe.
And it averted the danger that the ombudsman would set a precedent - and force the banks to repay all similar cases.

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An ombudsman spokesman said: "We told the banks we would be forced to investigate if they did not repay the full amount.
"They didn't want to have an investigation. So they agreed to pay up."
The OFT is in the middle of a market study of current accounts and is involved in a joint High Court action to decide whether fees are legal.
It reckons that overdraft penalties raise between £2billion and £3.5bn a year.
For almost two years now a consumer revolt has seen millions of pounds being returned to customers who have complained about the cost of their overdraft penalties, which can be as high as £39 a time.
Initially they took their claim to court, but this year the ombudsman was swamped by a flood of cases - hundreds every day.
The secret deal led to the ombudsman service sending a spreadsheet with the names and claims of any customers that had contacted them.
The bank would then reply, telling the ombudsman that each case would be paid in full.
It has also been revealed that banks have admitted confusing customers with their explanations of current account charges.
A rethink of the Banking Code is expected to clamp down on the way that banks explain their fees, terms and conditions.

[Paule]

Re: Banks struck secret deal with FOS

Its exactly the same as what the banks do with us.

They settle beforehand...

Can anyone honestly say they actually thought it would get to court????

Ignore what i wrote

I misread the earlier post, but I have left what i put so as not to make Cets posts look daft

[Guest]

Re: Banks struck secret deal with FOS

It's nothing of the sort. The FOS is an alternative to the Courts and can only act if the company being complained about fail in their obligation to take action - if the charges are paid, there is nothing for the FOS to do is there?

[Guest]

Re: Banks struck secret deal with FOS

Complainant attrition is the name of the game. This involves rejecting most complaints first off (gets rid of about 60%), offer 30% if the complainant comes back (another 20% gone), offer 50% if the complainant threatens court or the ombudsman (another 15% gone), and pay in full only to the remaining 5% who actually lodge court or ombudsman claims.

It's a numbers game and banks deal with numbers all day every day.

[Amethyst]

Re: Banks struck secret deal with FOS

ummmm the way thats written it sounds like anyone complains to FOS gets their claim paid in full within 8 weeks of complaining, without argument ? excuse me for being sceptical