OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

[Kafka]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

For credit cards, as its a proven penalty for breach of contract, the banks did disclose their costs etc to the OFT (we have the redacted info on here) and CitiCards have given defences in court consisting of a very vague breakfown of figures (remarkably making the COST to be just over the OFT's £12 threshold for intervention (£13.46) )

In my recent court hearing with Citi, they stated that using the OFT's prescribed methodology following the 2006 report, the 'true cost' is £13.47 based on the 'most recent calculations'.

Even more amazingly, they state that their methodology before the 2006 report showed that their 'actual default fees' were £27.42 when they were charging £25.

This suggests that Citi have a policy of setting default fees that always represent a loss to them, suggesting an act of philanthropy perhaps unique in the history of British banking?

If they are prepared to go to court to argue the figure of £13.47, then its unclear why they haven't charged more than the £12 threshold. I think Egg are the only bank that have pushed this and have got away with charging £16, suspecting correctly that the OFT would not take action to enforce the threshold.

[EXC]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Even more amazingly, they state that their methodology before the 2006 report showed that their 'actual default fees' were £27.42 when they were charging £25.

This suggests that Citi have a policy of setting default fees that always represent a loss to them, suggesting an act of philanthropy perhaps unique in the history of British banking?

pmsl you couldn't make it up could you? Except if you're Citibank that is.

[PocketTheDifference]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Wheres the sanity of this country!! Up in smoke! is there anywhere else in the world as crazy as our guys! Its a joke really. would you say £13.47 is close to what it would cost each bank then?

[Kafka]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Wheres the sanity of this country!! Up in smoke! is there anywhere else in the world as crazy as our guys! Its a joke really. would you say £13.47 is close to what it would cost each bank then?

Well the judge was happy with it, because I could not supply proof that it actually cost them less.

[Tools]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

if citi were claiming "a loss" on the charge they could argue cross subsidy from interest earned on "other accounts"

[PocketTheDifference]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Why is it your job to proove that it costs less rather than their more seemingly easier task to just show why it costs that I don't understand why the judges see it as your duty not the banks thats why im frustrated because its soo dam obvious!!

[Tools]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Because it is you bringing the claim to say that it doesn't cost that.

[EXC]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

The House of Commons have published this research briefing - 'Bank and Credit Card Charges'.

It ''Sets out the background and chronology to challenges mounted by both the public and the OFT against credit card companies and high street banks over their charging policies''.

A very interesting read. It's quite long but stick with it.

http://www.parliament.uk/commons/lib...snbt-03941.pdf

[charitynjw]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Wheres the sanity of this country!! Up in smoke! is there anywhere else in the world as crazy as our guys! Its a joke really. would you say £13.47 is close to what it would cost each bank then?

Yep, we definitely could do with a Sanity Clause :27:

[Smasher]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

As Ame says now that the Supreme Court has ruled that fairness rules cannot be applied to 'price' it's irrelevant what the banks charge costs are now.

We all know the cost is minimal but whether it's a couple of pence or a couple of quid it simply doesn't matter.

But that still only applies to existing terms. Given that most claims have charges under hisoric terms, it is still an important issue no?

[EXC]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

But that still only applies to existing terms. Given that most claims have charges under hisoric terms, it is still an important issue no?

I would say that the test case, as a principle, has established that the level of all insufficient funds charges - current or otherwise - cannot be challenged by virtue of UTCCR 6.2 and because they are not penal which means they can charge what they like relative to the cost.

[Smasher]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Yeh, the 'fee for a service' route, but as most of us are challenging under the 'to cover our costs' terms, 6.2 won't even come into it.

For claims under historics, costs are still a point of contention, so there is a valid cause to have them examined for the purpose of the case no?
We're not asking for the operating business costs, just the costs relating to specific events relating to an individual.
Can they still hide behind competition legislation when the very lawfulness is in question?

To parody it, if I run a courier firm and debit £300 from one of my customer's account for a returned parcel and just say it was to cover costs, could I just hide behind competition regs and just say "that's what it is"?

Of course, my courier service would be out of business in no time, a bank has the comfort of knowing the rest of the cartel operate the in the same way.

[catinahat]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

errrm... y'know insanity takes its toll... please be sure to have the exact change

[catinahat]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

Just a thought Ame, and maybe its not such an original thought but here goes.. As evryone probably heard, just before Christmas there was this daft campaign waged against Simon Cowell and X Factor song getting to Number one spot (again). Seemingly, a couple of blokes started it on facebook and offered 'Rage Against The Machine's, Killing in the name of..' as an alternative to the 'Cowell Machine'. For a campaign started by 2 blokes on facebook, they succeeded and RATM got the Christmas number one slot for 2009!! (Apparently, Mr Cowell has since invited the guys to join his employ... lol) My point being, if we could get some kind of 'charter' drafted up in succinct, brief, layman's terms; ie a list of what we as consumers agree are a reasonable set of demands/wish list, whatever, give it a name (Not Dick Turpin Treaty- LB's Banking Draft', (Scaatchi and Scaatchi feel free to input at this juncture...lol) but you get the idea; then post it on the FB petitions (which is free of charge to do) and start spreading the word...?? We know there's power in numbers, and its a click of a button for people to add their name to the petition and post it on... (simples:bump2: like I said, probably not an original idea but if 2 blokes on FB can succeed against the mighty Cowell on something as inane as a blooming X-Factor song, why can't we on an important issue that has affected millions severely and affects many more millions who need that apathy shaking up a tad;-) .... just a thought.. CatXXX

[Not_Watson]

Re: OFT v Banks Judgment 25th November 2009 - 9.45am- Supreme Court - Test case

I'd certainly add my name.

Off topic slightly - Rage Against the Machine's record label is owned by Simon Cowell ..... just as with banks - there is no escape !

I hope everyone's enjoying the snow.
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I'd certainly add my name.

Off topic slightly - Rage Against the Machine's record label is owned by Simon Cowell ..... just as with banks - there is no escape !
I think that is known as a "win-win" !

I hope everyone's enjoying the snow.