The OFT meet Legal Beagles - any questions ?

[Amethyst]

Re: The OFT meet Legal Beagles - any questions ?

Think thats down to the FSA - the interest bit - we could ask them their views on the comment in the waiver with regards to compensatory interest though ?

[Budgie]

Re: The OFT meet Legal Beagles - any questions ?

OK, The FSA waiver actually states

"(15) to the extent that sums are ultimately to be paid to complainants in respect of relevant charges complaints that have been stayed, the firm must include in these sums an element of compensation in respect of interest charged to or lost by the customer as a result of being out of money during the stay period;"

Now, I know that we have been using this clause as our justification for inclusion of some form of compensatory interest when Customer's are reclaiming charges on hardship grounds. However, in reality this clause only actually refers to compensatory interest as a result of being out of money during the stay period.

It is possible to draw a conclusion therefore that the FSA have not, to date, made any provision or suggestion regarding compensatory interest covering the period between when the charges were actually applied to Claimant's accounts and the date that the claim was stayed. Therefore any interest in respect of that period will be dependant on what the Claimant has actually claimed and what the Court might actually decide to award. Interest has certainly not actually been covered in the public test case hearings to date.

My question was aimed at the OFT, not the FSA. As the OFT are likely to play a major part in negotiating with the Banks and the High Court for a set of suggested criteria for settling the thousands of County Court claims. I personally think it would be a good idea if any compensatory interest element could somehow be included in those suggested criteria as well.

Otherwise we will be faced with a possibility of the thousands of Court claims having to actually be heard in Court anyway owing to there not being any guidance from the High Court with respect to the interest element of claims.

Surely everyone would be better served by some guidance from the High Court in this respect.

And YES, of course, it should in my view, be compound interest rather than statutory simple interest. Is there any reason why we should not suggest this as a strategy that the OFT should adopt on behalf of Claimants.

Budgie

[scoobydoo]

Re: The OFT meet Legal Beagles - any questions ?

If the case drags on and on do they think they can do anything about the banks continuing to charge at such a high rate during this period of time?

[EXC]

Re: The OFT meet Legal Beagles - any questions ?

1) Why have the OFT, taking into account the slow progress of the test case and their initial findings that the terms for some or all Banks are unfair not yet applied for an injunction against the Banks to stop them applying any further charges until final resolution of the test case?

?

I think that until the OFT knows the cost of administering the charges that couldn't. I believe that the 3 month consultation process with the banks currently underway may be exploring the bank's true costs.

[Budgie]

Re: The OFT meet Legal Beagles - any questions ?

I believe we might need to steer this back a bit towards the PCA report and it's findings.

Does anyone have any questions particulalry related to that report or it's findings.

Link to the Legal Beagles thread is here http://www.legalbeagles.info/forums/...ead.php?t=9534

and here http://www.legalbeagles.info/forums/...ead.php?t=9542

[EXC]

Re: The OFT meet Legal Beagles - any questions ?

This is the consultation document which outlines what the OFT wants views on. Definately worth a read.
http://www.oft.gov.uk/shared_oft/rep...oft1005con.pdf

[TANZARELLI]

Re: The OFT meet Legal Beagles - any questions ?

http://www.oft.gov.uk/shared_oft/rep....pdf?version=1

4.72 Furthermore, according to information given to us by banks, once customers have been informed that they have incurred a charge, few major banks make substantive attempts to inform them of the options open to them to limit further charges or warn them that they are incurring multiple charges.

Obviously this is not in their interests to do this as it is a way of making profit. If it was simply their costs they were charging then it would be an inconvenience for the banks and they would work with consumers to resolve this.

4.73 Some banks may attempt further contact if consumers have not resolved the situation, but it was not clear when or whether this was a systematic approach for most or just for a few customers. Indeed, given the revenue generated from insufficient funds charges, £2.6 billion in 2006, it may be the case that banks do not necessarily have a strong financial incentive to help consumers avoid them.

Most definately the case I would say.

[rosymaria]

Re: The OFT meet Legal Beagles - any questions ?

Hello LB - just wanted to congratulate you on getting the meeting!

My cogs are whirring - I'll let you know if I come up with anything before your meeting!

Again - well done

[EXC]

Re: The OFT meet Legal Beagles - any questions ?

Hello LB - just wanted to congratulate you on getting the meeting!

My cogs are whirring - I'll let you know if I come up with anything before your meeting!

Again - well done

Thanks rosy, you're very welcome!

[righty]

Re: The OFT meet Legal Beagles - any questions ?

Does the fact that the Competition Commission found in their investigation of NI banks that the true cost was at most 41p & that was for handling a cheque which of course does involve manual intervention ........... Comments please

[Amethyst]

Re: The OFT meet Legal Beagles - any questions ?

Initial thoughts on the consultation re the positives. The high level of satisfaction is probably due to the internal surveys sent out to customers which is based on Branch specific focus. I doubt anyone would have a significantly low level of satisfaction with the branch network.

I think this issue of "switching" perhaps needs to be highlighted more within bank brochures in terms of timescales and maybe a specific one, ie 1 week from first contact to all DD's transferred and account with first provider closed.


These are initial thoughts and still need to read further...I think there is a need perhaps for a standardisation of basic charges, ie going overdrawn/overlimit fees, unpaid items, and referral fees. Possibly a table of charges and examples as to their application(most banks may base a decision on internal credit scoring as to whether to pay or not pay an item).

Just adding to the list

With reference to Transparency as a Regulatory Tool the banks are opposed to releasing that data because they feel case management companies will focus on that to get more compensation from Banks. (3.8 of consultation)

Barclays reserve account ?????????? (3.10)

We would like to see measures that help
consumers have greater control over the incidence of charges allowing
them, where possible, to choose whether or not to incur any charges at
all.

don't agree with the premise in 3.10. I think consumers what better information to avoid charges incurred as a result of unauthorised borrowing.


3.15, data could be supplied as the average timescale per bank of switching which might improve the efficiency of the transfer. Perhaps, cards(cut up) and cheque books could be given to the recipient bank for them to return to the originating bank so that the end to end process is as efficient as possible.

I think the way package accounts work should be included in a fees brochure to make it clear when things go out and how the charging structure works. It is still not clear how packaged accounts and the benefits associated with them work or even that consumer read the leaflets they are given. Maybe additional information on a cheque book or PIB about the charging structure as well.


To summarise: Better structure of Bank Charges leaflets and how they work to include package accounts and examples of when someone would be charged and this should include uncleared cheques within it. Costs would be minimal in terms of the fact that banks already have banking leaflets and it would require, in part minor changes ie examples of how you are charged, and possibly a re write. If implementation is given 6 months after the completion of the OFT final report, it should see minimal impact.

With regards to Switching: switching rates per bank within a specific timescales. Most consumer maybe unaware how long it will take. Maybe in switching brochures there could be common factors slowing the process down or maybe these could be published/reported to the OFT so that there are high levels of efficiency. Issue of publishing them: claims management companies picking up of negatives to make claims for compensation against the bank(s) concerned(which maybe a reason to report to the OFT who may be able to take action as a regulator if common issues arise). Switching brochures being more prominent.

With regards to competition: better interest on current account as that which happened to businesses as a result of the Cruikshank Report 2001. Impact: loss of revenue on the one hand by increase in credit interest but long term could be to drive competition.

[Yoda]

Re: The OFT meet Legal Beagles - any questions ?

Why can Credit card companies issue defaults when there is NO agreement

Why can they sell on a debt when the account is clearly in dispute

Why can banks close business accounts just becasue they have struggled

after a debtor went bust on them, onlty to be left with no business account and no way of getting another

Why can they blatantly ignore the 12 day deadline for sending a copy of the agreement

Who is there to protect the consumer when all the above happens?
TS. OFT. FSA. FOS, MP & ICO all do not care

[righty]

Re: The OFT meet Legal Beagles - any questions ?

Yoda this might help explain why

PETER OBORNE: Kick-backs, cronies and Labours love affair with the City spivs | Mail Online

[EXC]

Re: The OFT meet Legal Beagles - any questions ?

''Lehman Brothers is a great company today that can both look backwards with pride and look forwards with hope. And in wishing Lehman Brothers the success it deserves for it's future, let me thank you for the privilage of being here and formally declare this new building open''.

And who took time out from their busy schedule to heap praise on Lehman while opening their sumptuous new offices in the city 4 years ago?

Step forward one Gordon Brown

[righty]

Re: The OFT meet Legal Beagles - any questions ?

For all his faults old Mac would never bestow honours on the bankers because he knew from experience to never trust them