OFT let consumers down AGAIN on Overdraft Charges

[thincat]

Re: OFT let consumers down AGAIN on Overdraft Charges

Well it seems as though it's "business as usual" as far as the banks are concerned. I feel
that it is now pointless to trust ANY so called institution that claims to be working "On behalf of the consumer". It's obvious to me that a more "adversarial" approach is called for because nobody at a certain level of the financial and regulatory food chain really
wants to upset the banks. All I've been reading about for the past few weeks is how
various banks and so called regulatory bodiies (consisting of ex-bankers I might add)
seek to profit at the expense of those who are not part of the clique of the well heeled
and collude to ensure they make money while those "outside the tent" as it were get
nada. Self evident perhaps and one could say it was ever thus. However this has now
got to an extreme and unless Legal Beagle,CAG etc continue to fight ever more
aggressively ,then things will DEFINITELY get worse. Another battle lost,
yes but NOT the war. Even if we throw in the towel don't we think that someone else
isn't going to say "I've had enough" . I have. It's difficult, it's tiring, it's frustrating,it's
annoying but it's essential things continue but perhaps a little more creatively.
As far as I can see certain institutions can no longer be trusted to act on behalf of those
they say they serve. I feel it's will be better to be more selective and circumspect in
dealing with those institutions and politicians who say they want the "input" of
Consumer organisations. The average joe and jane has been stabbed in the back yet
again- another painful lesson learned but as is often saidwhat doesn't kill you
can only make you stronger!

Thincat.

[enaid]

Re: OFT let consumers down AGAIN on Overdraft Charges

[quote=Amethyst;153677]Okay am going to stick up for the OFT so look away now.



They are limited in what they can do, the banks took the issue over charges to court - credit card companies could have done the same but knew they would lose. Banks thought they could win. And did. Thats ruled the OFT have no power to limit the fees.

Very disappointed yes and thought the OFT would go further but really they don't actually have the power to.



I think this is the whole point of why we are, or a few are having a pop at the OFT, the actual fact they don't have the power to finish what they start on behalf of the consumer.
It's a bit like having a life guard on duty that can only go into 4' of water, after that your on your own.
What we are left with now is by no means satisfactory, the banks still have the upper hand by a long way.
I also hope people don't give up on this, the banks make it look in theory that they are siding with what the consumer, let's see how it pans in practice.

[PocketTheDifference]

Re: OFT let consumers down AGAIN on Overdraft Charges

Got to say i Kinda agree with Enaid, Have the OFT left us with out a paddle now in a worse situation in comparison to where we were at before.
Is the OFT Tax payer run or Government run?? Either way seems a little fishy to me. Im a conspirothist, however i do belive the "GoV" would do anything to screw us over f it makes their pockets fatter!

[righty]

Re: OFT let consumers down AGAIN on Overdraft Charges

[quote=enaid;153713]

Okay am going to stick up for the OFT so look away now.



They are limited in what they can do, the banks took the issue over charges to court - credit card companies could have done the same but knew they would lose. Banks thought they could win. And did. Thats ruled the OFT have no power to limit the fees.

Very disappointed yes and thought the OFT would go further but really they don't actually have the power to.



I think this is the whole point of why we are, or a few are having a pop at the OFT, the actual fact they don't have the power to finish what they start on behalf of the consumer.
It's a bit like having a life guard on duty that can only go into 4' of water, after that your on your own.
What we are left with now is by no means satisfactory, the banks still have the upper hand by a long way.
I also hope people don't give up on this, the banks make it look in theory that they are siding with what the consumer, let's see how it pans in practice.

The banks didn't take the OFT to court, the OFT AGREED to mount an action & they could have refused citing if needs be financial constraints.

Also up until then the banks had many a chance to argue their case in court but chose not to. Considering that they with deep pockets would be up against unfunded LiP's it beggars the question as to why they decided this would be the best course of action for them

In addition mounting the action saved them billions by stopping all claims in there tracks courtesy of the FSA whilst the banks were still able to impose their exorbitant penalty charges

[PocketTheDifference]

Re: OFT let consumers down AGAIN on Overdraft Charges

[quote=righty;153736]

In addition mounting the action saved them billions by stopping all claims in there tracks courtesy of the FSA whilst the banks were still able to impose their exorbitant penalty charges

HAHA so the Banks where the winners then and are the winners now, so whatever the OFT did and however long they took, they didn't even care, being able to charge while the case was about is an insult!!
LOL'D

[Amethyst]

Re: OFT let consumers down AGAIN on Overdraft Charges

Okay, go back in time - the OFT refuse to take part in the action and try to impose limits on charges the same way they did with credit cards - what would the banks have done ? Sued the OFT maybe (as it has now been proven it isnt in their power to limit the charges)

What would the consumers have done ? Continued court claims more than likely.

What would the courts have done ? Well, stayed the claims till the outcome of the banks v oft probably - possibly continued groupng claims up together for one big test case (like in Leeds merc etc) then err stayed that pending the banks v oft ?

Same outcome, more expense to the tax payer ?

[natweststaffmember]

Re: OFT let consumers down AGAIN on Overdraft Charges

Amethyst, I think the OFT should have recommended to the politicians that if they truly want a fair system that they should legislate to have one. Which? have already come on record stating that HSBC new account at £15 a month is still quite expensive. Remember, many packaged accounts with extras are cheaper than the £15.00 a month for something that the banks COULD have done before.

I would like to know if there is anything the OFT would do with regards to non authorised card payments because that is clearly something that CAN be dealt with through the POS machines issuers. Why are non authorised payments allowed?

[EXC]

Re: OFT let consumers down AGAIN on Overdraft Charges

Amethyst, I think the OFT should have recommended to the politicians that if they truly want a fair system that they should legislate to have one.

We don't know that that didn't happen.

[Judge mental]

Re: OFT let consumers down AGAIN on Overdraft Charges

Amethyst


Have you been at that wine again?? or maybe something happened last night to put you in such a good mood?? I too tried to play devils advocate and look at the report positively . . . your post shows you clearly struggled as well.

Okay am going to stick up for the OFT so look away now.

I think they have taken consumers views (via consumer organisations) into account when dealing with the investigation and with the banks and I dont think it is some weird ploy so they can say they have done so but not do anything.


Whilst they might have listened to consumer views (who they are supposed to represent and protect after all) they have not actually taken them onboard.

They are limited in what they can do, the banks took the issue over charges to court - credit card companies could have done the same but knew they would lose. Banks thought they could win. And did. Thats ruled the OFT have no power to limit the fees.

Very disappointed yes and thought the OFT would go further but really they don't actually have the power to.

The Banks did not win the case, the OFT lost it by allowing the Banks to manipulate and control the nature and direction of the test case. The OFT are only limited in what they can do under regulation 6(2) . . . that is not the limit of their given power.

People WANTED to be able to opt out of having unauthorised overdrafts - it was one of the main things that has come up time and time again - and the OFT have got the banks to agree to do it - it may take some time, but competition in that area will push the monthly fees for such an account down over time.

These are token consolations given what was really at stake,

I don't feel like we were used at all, I think we did right trying to put consumers views across and try to get the OFT to act on them.

You were not used, you were given the opportunity to speak on behalf of people at ground level, which was unselfishly grasped with both hands.

If you read the first interim OFT PCA report and this one they have looked at quite a few areas which we(consumers) put forward and things are improving, slowly and marginally maybe, but improving.

I'm not put off continuing putting consumers views across - we're much more at ground level and in a position to put true views across than say CAB or Which? who's consultation responses tend to be a few case studies and some statistics - so will continue to respond to consultations and complain about stuff we think is wrong - because if we dont, who will? and how will the OFT know whats going on ?

Still flipping angry, yesterday was absolutely furious, but I'm not giving up, so I hope no one else is either.

I for one am pleased to hear it, we have been deserted by the OFT who showed they do not the stomach for a real fight. Your drive, energy and commitment to the cause keeps us all believing and is quite rightly applauded,

[Amethyst]

Re: OFT let consumers down AGAIN on Overdraft Charges

Ahhh well we tried !

'' You were not used, you were given the opportunity to speak on behalf of people at ground level, which was unselfishly grasped with both hands. ''

I agree, and we would do so again, and again, and again.

Some fabulous people on this site who are committed (if a little obsessive) about getting some justice and fairness in this ridiculous 'financial inclusion' world we live in.

[righty]

Re: OFT let consumers down AGAIN on Overdraft Charges

Okay am going to stick up for the OFT so look away now.

I think they have taken consumers views (via consumer organisations) into account when dealing with the investigation and with the banks and I dont think it is some weird ploy so they can say they have done so but not do anything.

They are limited in what they can do, the banks took the issue over charges to court - credit card companies could have done the same but knew they would lose. Banks thought they could win. And did. Thats ruled the OFT have no power to limit the fees.

Very disappointed yes and thought the OFT would go further but really they don't actually have the power to.

People WANTED to be able to opt out of having unauthorised overdrafts - it was one of the main things that has come up time and time again - and the OFT have got the banks to agree to do it - it may take some time, but competition in that area will push the monthly fees for such an account down over time.

I don't feel like we were used at all, I think we did right trying to put consumers views across and try to get the OFT to act on them.

If you read the first interim OFT PCA report and this one they have looked at quite a few areas which we(consumers) put forward and things are improving, slowly and marginally maybe, but improving.

I'm not put off continuing putting consumers views across - we're much more at ground level and in a position to put true views across than say CAB or Which? who's consultation responses tend to be a few case studies and some statistics - so will continue to respond to consultations and complain about stuff we think is wrong - because if we dont, who will? and how will the OFT know whats going on ?

Still flipping angry, yesterday was absolutely furious, but I'm not giving up, so I hope no one else is either.

Well done Ame. I really admire your pluck particularly after being so affectively shafted by the OFT

Well up & at 'em I say

PS that pm I sent you, have just been informed that the cheque has arrived so should have something to cheer folks up very soon when it clears Note sorry folks my pending news has nothing to do with bank charges wish it did

[EXC]

Re: OFT let consumers down AGAIN on Overdraft Charges

Just a couples of points:

''Whilst they might have listened to consumer views (who they are supposed to represent and protect after all) they have not actually taken them onboard.''

It is not really the function of the OFT to 'represent' consumers or anybody. It is principally a competition authority (and as such has to act impartially), it's aim being to make markets work from a consumer perspective, unlike a designated consumer group or industry watchdog - a subtle but important distinction in understanding the constraints they have to work under.

''The Banks did not win the case, the OFT lost it by allowing the Banks to manipulate and control the nature and direction of the test case.''

I disagree. The OFT brought the test case under UTCCR. The campaign WANTED the level of bank charges to be scrutinised under these regulations and that's what they did. But they were in fact very careful not to be seen to challenge the level of the price in order to avoid 6.2 and instead challenged the principle of the charges. Up to the first 2 judgments nobody was saying that the OFT were allowing the banks to manipulate and control it. In the end the case was lost on a point of law.

''The OFT are only limited in what they can do under regulation 6(2) . . . that is not the limit of their given power.''

What IS the limit of their given power?

[Kafka]

Re: OFT let consumers down AGAIN on Overdraft Charges

Just a couples of points:

''Whilst they might have listened to consumer views (who they are supposed to represent and protect after all) they have not actually taken them onboard.''

It is not really the function of the OFT to 'represent' consumers or anybody. It is principally a competition authority (and as such has to act impartially), it's aim being to make markets work from a consumer perspective, unlike a designated consumer group or industry watchdog - a subtle but important distinction in understanding the constraints they have to work under.

''The Banks did not win the case, the OFT lost it by allowing the Banks to manipulate and control the nature and direction of the test case.''

I disagree. The OFT brought the test case under UTCCR. The campaign WANTED the level of bank charges to be scrutinised under these regulations and that's what they did. But they were in fact very careful not to be seen to challenge the level of the price in order to avoid 6.2 and instead challenged the principle of the charges. Up to the first 2 judgments nobody was saying that the OFT were allowing the banks to manipulate and control it. In the end the case was lost on a point of law.

''The OFT are only limited in what they can do under regulation 6(2) . . . that is not the limit of their given power.''

What IS the limit of their given power?

I can't be alone in having always believed that the Test Case was instigated by the banks and controlled for their own agenda.

When the whole thing was cooked up secretly, the BBC reported that it was actually the banks that offered to go to the Test Case, rather than the OFT showing initiative. An immediate concern of all consumer groups was that there was no clear timeframe and that the TC would be allowed to drag on and on indefinitely, because that suited the banks as they were no longer having to settle claims, while being left to carry on charging indiscriminately.

The FSA produced safeguards for consumers that were routinely ignored and don't forget that the T&Cs examined were largely those that were doctored by the banks in defiance of the FSA's reassurance that this would not be allowed while the Test Case continued.

The courts were involved with the strategy here, but no guidance was given to them, resulting in the Test Case being used as an excuse to stay all manner of totally unrelated claims. Had consumer interests been fairly considered in the planning this should never have been allowed to happen.

Finally, soon into the Test Case, we had the staggering public admission by Cavendish Elthorne - a senior OFT figure - that the OFT would rather make an agreement with the banks than see the Test Case through to a proper conclusion. I actually thought this would be the eventual outcome, when the banks realised they could not win in court after dragging it out, and would have given them licence to take a reduced level of profits from penalties, in the same way that the 2006 credit card report failed to bring about the changes to actual costs. No bank reduced its charges below the threshold of £12 and we have had 4 years of shambles that is still not sorted by the OFT, with banks claiming that £12 is 'an OFT approved/recommended rate'.

It always struck me that the entire Test Case was designed to suit the banks' interests and to deny justice to the consumer. There was no evident consideration of the rights or needs of consumers, apart from the FSA's pathetic safeguards that were just a figleaf of decency to cover the regulators (sic.) and allow Government ministers to announce proudly that the FSA was safeguarding consumers' interests.

[EXC]

Re: OFT let consumers down AGAIN on Overdraft Charges

When the whole thing was cooked up secretly,
Are test cases usually cooked up publicly?

the BBC reported that it was actually the banks that offered to go to the Test Case, rather than the OFT showing initiative.
Am I disputing this?

An immediate concern of all consumer groups was that there was no clear timeframe
Are there ANY clear time frames in litigation?

and that the TC would be allowed to drag on and on indefinitely, because that suited the banks as they were no longer having to settle claims, while being left to carry on charging indiscriminately
But it didn't drag on indefinitely did it?

The FSA produced safeguards for consumers that were routinely ignored and don't forget that the T&Cs examined were largely those that were doctored by the banks in defiance of the FSA's reassurance that this would not be allowed while the Test Case continued.
Again I'm not disputing this

The courts were involved with the strategy here, but no guidance was given to them,
Yes it was. Twice.

resulting in the Test Case being used as an excuse to stay all manner of totally unrelated claims. Had consumer interests been fairly considered in the planning this should never have been allowed to happen.
Allowed by who? The OFT have no jurisdiction on the courts staying unrelated cases.

Finally, soon into the Test Case, we had the staggering public admission by Cavendish Elthorne - a senior OFT figure - that the OFT would rather make an agreement with the banks than see the Test Case through to a proper conclusion.
This was prior to the test case, not soon into it.


I actually thought this would be the eventual outcome, when the banks realised they could not win in court after dragging it out, and would have given them licence to take a reduced level of profits from penalties, in the same way that the 2006 credit card report failed to bring about the changes to actual costs.
I don't understand what you're saying. Credit card charges were changed to £12 as a direct result of the OFT's intervention.

Try and look at it a bit more objectively.

[dad]

Re: OFT let consumers down AGAIN on Overdraft Charges

Dear All,

For me the unforgiveable failure of the OFT was their handling and lack of appeal of the penalties issue.

In any normal contract dispute the situation is considered at the time that the contract is made. In virtually every case that means that the historic terms should have been considered the priority.

To allow the banks to present their 'disguised penalty' terms for the main consideration was a strategic blunder, especially without evidence from actual consumers.

Separately, the SC did not go back to look at PIL. Smithy said the terms were PIL based on HIS interpretation of them. However the SC said both he and the CoA got what the charges were wrong. How can it be that they are in PIL as far as a consumer is concerned?

Would anyone say 'You are not to allow your account to become overdrawn' is PIL for 'this is a core part of our charges for providing an account'?

I admire the team's dedication in working with the OFT, but I am totally underwhelmed by the OFT's performance.

Dad