MSE News: Bank charges fighting on: a new legal argument

Edinburghlass_2

Despite my request to keep this particular thread on topic it has rather gone off the subject so I'll take some time to move some posts over to this thread.

http://forums.moneysavingexpert.com/showthread.html?t=2103589&page=38

No matter where you are posting please can you try and be polite and avoid name calling no matter which "side" you perceive yourself to be on, thanks.

yarowcabra

It seems to me that most arguments in favour of the recent ruling are ignoring the obvious.

The issue is not whether bank accounts are kept in credit etc but whether the banks acted wrongfull or unfairly or possible illegally.

On this basis alone the OFT has no other obligation but to pursue the matter further on another point of law.

Perhaps by some twisted logic there are those who believe that illegal/unfair/immoral activity should be allowed with no fair of recourse so long as their satus quo is not affected.

A sad commentary.

pseeker_2

everyone knows banks will have to charge someone at some point, they are businesses not charities! ATMs don't run for free, money don't run through the system for free. So what do YOU prefer paying for?

(Note 1 - this is especially interesting if you are aware of the discussion whether high-street and investment banks should be separate entities, following the credit crisis)
(Note 2 - in some countries, you can get charged for just sending money or even recieiving money!)


below, from my favourite column, daily editorial on the second page of CityAM from Allister Heath (often the only thing i read from cityam):

"Banks and consumer groups are both wrong. It would be much more rational for banks to charge for everything explicitly and transparently– all bank accounts and credit cards would come with an annual fee, for example, injecting comparability and hence greater competition into the market."

I am not allowed to post links, so for the full text google> "There is no such thing as a free lunch in banking"

PS> I'd just like to bring in a broader, albeit out-of-consumer-circle perspective.

DaveF327

Penalty_charges wrote: »

www.Penaltycharges.co.uk Is very pleased to confirm that we have joined forces with Money Saving Expert, Legal Beagles and the Consumer Action Group.
In a joint campaign against unlawful bank charges, Money Saving Expert has paid for Ray Cox 'QC' to draft the new Particulars of claim (POC) for all forums,

While he's on the payroll, can you get him to look at private parking charges as well? A supreme court judgement would be welcome on that one too.

natweststaffmember

pseeker wrote: »

everyone knows banks will have to charge someone at some point, they are businesses not charities! ATMs don't run for free, money don't run through the system for free. So what do YOU prefer paying for?
Wha has stated that the bank CANNOT charge for returning a DD, or returning a cheque or for an extended overdaft without first asking the bank to do that?
No one is arguing that charges should be FREE or should incur NO CHARGES.
(Note 1 - this is especially interesting if you are aware of the discussion whether high-street and investment banks should be separate entities, following the credit crisis)
(Note 2 - in some countries, you can get charged for just sending money or even recieiving money!)
On Note 2, it's the same on overseas payments

below, from my favourite column, daily editorial on the second page of CityAM from Allister Heath (often the only thing i read from cityam):

"Banks and consumer groups are both wrong. It would be much more rational for banks to charge for everything explicitly and transparently– all bank accounts and credit cards would come with an annual fee, for example, injecting comparability and hence greater competition into the market."

I am not allowed to post links, so for the full text google> "There is no such thing as a free lunch in banking"

PS> I'd just like to bring in a broader, albeit out-of-consumer-circle perspective.

I can post links so here it is:
http://www.cityam.com/news-and-analysis/Allister-Heath/jgkhgx22kf.html

Chrysalis

mramra wrote: »

I sincerely hope not. The majority of bank account holders who manage their money carefully, budget within their means, and therefore manage to avoid going into unauthorised arrears would quite like to continue with free banking thank you very much. :beer:

just to point something out to you.

if no one got these fees, do you think you would have a fee? has it not crossed your mind you only don't get fees because the fees been applied to others are excessive enough in that it subsidises your account.

your reply is very selfish in which you are basically saying you dont care for others as long as you are better off.

Chrysalis

mramra wrote: »

I wish everyone the best with their personal financial situations. I also hold no grudge with those who have genuinely been treated unfairly by banks, I'm sure there are a few genuine cases for reclaim of charges. What I object to very strongly are the people who are trying to claim back charges which they incurred fair and square due to poor management of their money, lack of budgeting etc. and now see the opportunity for a quick buck by jumping on this bandwagon.

please answer my question.

you think its fair if someone gets a returned item charge or unauthorised overdraft charge they pay for your bank account as punishment?

Chrysalis

NeilW wrote: »

You've fallen for the Bank's FUD. The bank makes its money from those in credit by lending out their deposits again using the fractional system. For that it charges an interest rate.

The difference between the rate lent and the rate paid to the current account holder, less costs is how a bank makes its money. Moreover it is precisely how a bank should make its money.

Banks make much more money from credit customers than overdraft customers - something like £4 billion pounds of revenue from credit customers and £2 billion from overdraft charges. And that neatly finishes off Martin's 'new' argument, because in reality it is the credit customers that are subsidising the overdraft customers...

NeilW

Not quite.

30% of revenue from 20% of customers, 50% of revenue from the other 80%. So the richer customers only make more revenue because there is more of them, but the bank makes less revenue on average per customer in that 90%.

edwace

Banks by their very nature have more than enough information to know when a customer is in financial crisis, some years ago the customer would have been called in and told the situation was unacceptable and something done to halt the situation before it got out of hand.
Recently the bank is more likely to have the same customer in for a monthly review, which will be used as a sales gambit where the customer is encouraged to buy financial products that will make their situation worse.

Ok maybe you think that charges that drive some people into extreme hardship are fair enough because you imagine that’s the reason you get free banking, but every time you put forward your somewhat selfish argument, try to remember it was that disregard for the financial well being of customers that caused the present crisis, those same customers en masse decided not to bother paying the banks back, the resulting mess without the tax payer bailout would have resulted in your not caring in the least about free banking because your money and your bank would be gone.
Not possible? That’s what people thought in the 1930`s.
And remember every time the people you couldn’t care less about have a house repossessed your property value goes down that little bit more ,so now you have a reason to care how the banks are treating others and still retain your uncaring self-interests.
Banks used to and still can make enough profit from interest and reasonable charges for out of the ordinary services, but this trend, to suck as much money from customers simply for providing nothing is not only a bad long term business strategy it has already proved to be a dangerous financial risk.
Carry on running the financial services in this country in this unfair and irresponsible way and the Grapes of Wrath will be as relevant to the UK in the 21`st century as it was to America in the 1930`s. Good business does not need to be unethical to be profitable.

[FONT=&quot]The bank is something more than men, I tell you. It's the monster. Men made it, but they can't control it."
[/FONT][FONT=&quot]- John Steinbeck, The Grapes of Wrath, Chapter 5[/FONT]

Centium5000

Fantastic post edwace, it's all too easy to forget the historical perspective.

Thanks for reminding us.