Banks-the Mis-sale Of Bank Products

house1_2

yes

If it was mis-selling by only a few (the alcohol analogy) then I would agree, but it isn't. Mis-selling in Banks is a disease.

The PPI product and it's mis-sale is an example of this. (and on this occassion the Govt HAVE decided to ban it).

However, that's not to say that the main features of the product itself are poor. Just it's price and widescale mis-sale via tactics based largely on meeting targets rather than customer needs. In fact on many occassions there is a genuine need for Loan Protector Insurance (just on more equitable terms).

Banks rely on customer complacency and customer trust. In fact they prey on this.

The fact is mis-selling exists and more needs to be done to curb/stop it.

Leaving things as they are is not an option.

Since the Govt got involved in the mis-selling of Loan Insurance they should also now take a close look at 1. the sale of packaged accounts 2. the sale of stock market investments 3. the sale of credit cards (& associated insurances).

Regrettably, the existing system has turned many staff (not all) into little more than spivs. It has created selfishness and promoted division amongst them.

Banks (or more accurately their chief executives) have taken a deserved hiding recently. We need to get back to the values of honesty and genuine helpfulness. Just leaving things as they are will not achieve this. I wonder how many folks out there associate honesty and integrity with Banks. Less than they did 20 years ago I guess.

Sadly, I do not have a definitive solution and yes there are obstacles to overcome (i.e identifying differentials in individual staff performance without targeting) but something should be done.

chambta

no

[QUOTE=house1;18316087]If it was mis-selling by only a few (the alcohol analogy) then I would agree, but it isn't. Mis-selling in Banks is a disease.

The PPI product and it's mis-sale is an example of this. (and on this occassion the Govt HAVE decided to ban it).

However, that's not to say that the main features of the product itself are poor. Just it's price and widescale mis-sale via tactics based largely on meeting targets rather than customer needs. In fact on many occassions there is a genuine need for Loan Protector Insurance (just on more equitable terms).

Banks rely on customer complacency and customer trust. In fact they prey on this.

The fact is mis-selling exists and more needs to be done to curb/stop it.

Leaving things as they are is not an option.

Since the Govt got involved in the mis-selling of Loan Insurance they should also now take a close look at 1. the sale of packaged accounts 2. the sale of stock market investments 3. the sale of credit cards (& associated insurances).

Regrettably, the existing system has turned many staff (not all) into little more than spivs. It has created selfishness and promoted division amongst them.

Banks (or more accurately their chief executives) have taken a deserved hiding recently. We need to get back to the values of honesty and genuine helpfulness. Just leaving things as they are will not achieve this. I wonder how many folks out there associate honesty and integrity with Banks. Less than they did 20 years ago I guess.

Sadly, I do not have a definitive solution and yes there are obstacles to overcome (i.e identifying differentials in individual staff performance without targeting) but something should be done.[/QUOTE]

Alcoholism is also a disease so will you ban alcohol after all?

I agree with a lot of what you say incidentally and am fully aware in my role of the position of trust I find myself. I always treat every customer as if they were a member of my own family. I know though that for every adviser like me there's a dodgy one.

Incidentally I had an 82 year old woman booked in to see me for a loan she wanted for a kitchen. As she had the money in savings with us I pointed out to her how much she'd pay in interest compared to what she'd lose by taking from her savings.

She ended up changing her mind and not doing a loan that would have meant us reaching our loan target for the week. A few minutes later someone else came in to ask for one so we got to target after all. I felt that was deserved good fortune!

Extant

no

house1 wrote: »

If it was mis-selling by only a few (the alcohol analogy) then I would agree, but it isn't. Mis-selling in Banks is a disease.

This is where your argument falls down: you have no actual idea how widespread mis-selling is, all you have to operate on is anecdotal evidence.

You claim it's a disease, but I can also talk from my own experience - I managed three different branches in my time as a branch manager, and I had one mis-selling complaint returned to me - not even about PPI, but about an old Regular Saver product that Barclays offered, and about the interest rate there on.

Since then I have also worked in Customer Relations for Barclays, and I can tell you that significantly more complaints regarding PPI were received around the time taken to make a claim than mis-selling.

So... anecdotal evidence versus anecdotal evidence.

The PPI product and it's mis-sale is an example of this. (and on this occassion the Govt HAVE decided to ban it).

No, they haven't - the Competition Commission have banned point of sale PPI, meaning it can no longer be packaged with loans at the time of opening.

The fact is mis-selling exists and more needs to be done to curb/stop it.

Leaving things as they are is not an option.

So long as you live in a free market based economy with sellers, there will always be mis-selling. It's the human condition, greed.

That said, it can be minimized, yes - but there are already tools and processes in place to do so. These should be pursued and used more vigorously in the way they were intended to be. The FSA exists for a reason.

Since the Govt got involved in the mis-selling of Loan Insurance they should also now take a close look at 1. the sale of packaged accounts 2. the sale of stock market investments 3. the sale of credit cards (& associated insurances).

Again, all of these things are either incredibly tightly regulated already, or the tools exist but aren't being used.

Sadly, I do not have a definitive solution and yes there are obstacles to overcome (i.e identifying differentials in individual staff performance without targeting) but something should be done.

Changing the law isn't the answer to everything. And it certainly isn't the answer when you can't even think of the real alternative.

The FSA is, in theory, a wonderful thing - but it falls down by being reactive; it needs to be significantly more fluid and pro-active.

house1_2

yes

1. We agree the FSA should do more.

2. Our views differ (but I stand to be corrected) in that you accept greed as being inevitable. Yep, you are right it is part of the Human Condition-and will thrive where it goes unfettered. Also part of the human condition are things such as helpfulness, friendliness, compassion etc...none of which are measured/targeted by the Banks. It is my hope that either a change in the law or a tightening/enforcement of existing laws/regulations prevents greed thriving. The existing use of Management by Objectives does nothing to stop greed and thus the mis-selling that ensues -it merely promotes it! In this respect an active FSA would merely provide short term cures. They would not deal with the causes. I think we should ask our politicians to look at the causes of greed in the workplace by investigating the methods used by Banks (and other industries) in assessing individual performance and evaluate whether they benefit society or not. It is my opinion that they do not.

3. This change can happen if a groundswell of opinion puts politicians under pressure. So those people who have had either good or bad experiences with the sale of 1. packaged accounts 2. stock-market related products 3. credit cards (and related insurances) please feel free to add your comments.

4. I don't have an alternative solution (measuring individual performance) but through discusion/debate maybe one will emerge

5. The Competition Commission is part of the Office of Fair Trading which in turn is a department of the Government.

6. I like a drink so less talk about banning that, please. We'll leave that for another day (well into the future).

Extant

no

house1 wrote: »

2. Our views differ (but I stand to be corrected) in that you accept greed as being inevitable. Yep, you are right it is part of the Human Condition-and will thrive where it goes unfettered. Also part of the human condition are things such as helpfulness, friendliness, compassion etc...none of which are measured/targeted by the Banks.

I can tell you at length about Barclays service standards, where in helpfulness and friendliness are measured and targeted.

I am sure that other users of these forums (ShelfStacker for HSBC, Kavanne for RBS Group) can tell you about theirs, as well.

It is my hope that either a change in the law or a tightening/enforcement of existing laws/regulations prevents greed thriving. The existing use of Management by Objectives does nothing to stop greed and thus the mis-selling that ensues -it merely promotes it! In this respect an active FSA would merely provide short term cures. They would not deal with the causes. I think we should ask our politicians to look at the causes of greed in the workplace by investigating the methods used by Banks (and other industries) in assessing individual performance and evaluate whether they benefit society or not. It is my opinion that they do not.

This is becoming very much "big government" and "nanny state" sounding.

Mis-selling exists because sellers are rewarded based on what they sell: the more profitable products will naturally be paid more.

If you wish to change this, you are advocating a complete step away from the traditional business model not only of banks, but of virtually all retail establishments. The government has no mandate to do this.

3. This change can happen if a groundswell of opinion puts politicians under pressure. So those people who have had either good or bad experiences with the sale of 1. packaged accounts 2. stock-market related products 3. credit cards (and related insurances) please feel free to add your comments.

4. I don't have an alternative solution (measuring individual performance) but through discusion/debate maybe one will emerge

You are advocating change but have nothing to change to. You have not given any clear reason why you believe the existing measures to be inappropriate (assuming they were implemented correctly).

5. The Competition Commission is part of the Office of Fair Trading which in turn is a department of the Government.

The Competition Commission is a "non-departmental public body" funded by the Department of Trade and Industry. It, along with the FOS and FSA, are designed to be independent of the government and operate on the basis of law - hence none of them having a Minister in charge of them.

To say that because the CC banned point of sale PPI the Government banned it is incorrect; no elected official was involved in this decision, nor was an Act of Parliament passed.[/quote]

house1_2

yes

1. The CC uses Parliamentary delegated powers. If you think that the Government had nothing to do with the banning of PPI then we will agree to disagree on this one.

2. What brought about the withdrawal from sale (banning) of PPI? Answer-mis-selling. What caused this mis-selling? Answer- individual sales targets via the use of Management by Objectives. It isn't just the cash reward (the carrot)that drives dysfunctional behaviour but also fear (of disciplinary action-the stick) if targets are not met. That's why I want the Govt (or CC, or FSA, or whoever) to ban the use of Management by Objectives in it's present format.

3. Perhaps the CC can now move onto the other products that I mentioned earlier.

4. What's wrong with Government getting involved for the protection of the consumer?

5. Change from individual sales targets to no individual sales targets. Simply meet the customer need as/when it arises-whats wrong with this idea? But as long as Management by Objectives continues (in it's present format) as a measurement tool then mis-selling will continue and the poor consumer will continue to be ripped-off. Lets just stop it at the outset.

6. The Government has every right (mandate via Gen Election) to intervene (on behalf of consumers) if the business model is deemed to be flawed. What's wrong with radically changing the way in which goods/services are presently sold/bought if elements of the existing model promote unacceptable greedy/selfish behaviour? Do we do something to stop mis-selling or do we do nothing? Do we accept that consumers being conned is merely a by-product of the way in which things are done at the moment-or, do we look to protect the consumer by changing things?

Kavanne

I wish I didn't have sales targets in my job, but I do. and in this job you would have to unless our function was something COMPLETELY different. Ie: we were all moneysense advisors. But we're not. I can assure you, if anyone comes through to me when they phone the bank, they will not be missold anything!!

PROLIANT

comment

Not really sure how to answer the question.

Mrs_Ryan

I think it is rife, tbh. Its totally morally wrong to sell someone a product that they obviously do not need or in some cases cannot afford and where can that land people?

My mum is quite financially savvy and she was mis-sold a savings account with A&L, as they claimed it was one rate and it turned out to be another quite significantly lower, and they mis-sold me my current account by incorrectly telling me that my card can be used to buy tickets at train stations when I told them I didnt want it if it couldnt be used at train stations. Which I had to find out myself - the hard way.
And when I asked to upgrade my Step account at Natwest, I was told I could only upgrade ot Advantage Gold. I definitely wasnt allowed Current Plus and if I didnt upgrade to AG I wouldnt be allowed to try again and I would always be stuck with Step account. Now if that isnt blatant mis-selling then what is????? I got all my money back after I complained - and it was changed to Current Plus, no problem.
I realise banks have sales targets but maybe they should start thinking about whether the customer needs it rather than just the pound signs in their eyes...!!!

Kavanne

Mrs_ Ryan I am so sorry to hear about your experience it sounds awful. Did you apply in branch, by chance?