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MSE News: OFT 'to drop' bank charges case
Comments
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Correct me if I'm wrong but weren't the banks paying out well before OFT even became involved... from where I'm sitting we're just back the stage were the consumer takes it forward themselves via new templates which will be winging their way soon I hope and banks have the option of expensive and difficult defenses in court or pay off settlements as we still have no clarity like at the start of it all.0
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It's not over yet. That is not what the OFT said.
The OFT said this.....Why isn't the OFT taking an unfair relationships case?
The OFT has considered the possibility of pursuing a case under the Enterprise Act based on the unfair relationship provisions of the Consumer Credit Act (CCA) 1974 (a collective challenge).
The OFT’s initial assessment is that there are not good grounds for concluding that a collective challenge alleging breach of these provisions arising from the use of the Relevant Terms generally would have good prospects of success. This partly reflects an assessment of the wider repercussions of reasoning underlying the Judgment. This reasoning will inevitably be influential in guiding the deliberations of any UK court before which the OFT might bring enforcement action based on the concept of fairness.
An individual challenge might succeed where a collective challenge would not since a case would need to focus on the individual circumstances of each creditor-debtor relationship – including matters relating to the individual debtor.
As such, the OFT has no current intention to start an unfair relationships investigation.Free/impartial debt advice: National Debtline | StepChange Debt Charity | Find your local CAB
IVA & fee charging DMP companies: Profits from misery, motivated ONLY by greed0 -
I would have assumed that there would be fairly strict conditions with regards to disclosing information within the OFT. How then can Sky TV come up with the OFT's decision hours before the 7 o'clock statement.
No doubt they will be frantically trying to find the leak and also if they got any reward for their wrong doing.0 -
Direct from the horses mouthIt's not over yet. That is not what the OFT said.
http://www.oft.gov.uk/news/press/2009/144-09...After detailed consideration of the judgment and of the various options available to it, the OFT has concluded that any investigation it were to continue into the fairness of current unarranged overdraft charging terms under the UTCCRs would have a very limited scope and low prospects of success. Given this, it has decided against taking forward such an investigation...
John Fingleton, OFT Chief Executive, said:...
'Having now considered in detail all the options available to us in light of the judgment, we have decided not to continue what would be a narrow investigation with limited prospects of success..."Now to trolling as a concept. .... Personally, I've always found it a little sad that people choose to spend such a large proportion of their lives in this way but they do, and we have to deal with it." - MSE Forum Manager 6th July 20100 -
Thanks Premier, but you have only focussed on one part of the OFT press statement, presumably because that suited your argument.
The full release follows: (the relevant parts have been highlighted FYI.
OFT announces decision and next steps on bank charges
144/09 22 December 2009
Following the Supreme Court's judgment last month, the OFT has today announced its next steps in securing changes to unarranged overdraft charges and the wider personal current account market.
The Supreme Court found that unarranged overdraft charging terms in the contracts considered are not assessable in full under the Unfair Terms in Consumer Contract Regulations 1999 ('UTCCRs').
After detailed consideration of the judgment and of the various options available to it, the OFT has concluded that any investigation it were to continue into the fairness of current unarranged overdraft charging terms under the UTCCRs would have a very limited scope and low prospects of success. Given this, it has decided against taking forward such an investigation.
The OFT nevertheless continues to have significant concerns about the operation of the market for personal current accounts. Despite some recent and planned improvements by banks, particularly around transparency and customer switching, it believes fundamental changes are still required for the market to work in the best interests of bank customers. Banks earn around a third of their personal current account revenues from unarranged overdraft charges that are difficult to understand, not transparent and not subject to effective consumer control.
A number of options are available to secure the changes that the OFT wants to see, ranging from voluntary action to legislative change. The OFT will now discuss these issues intensively with banks, consumer groups and other organisations, with the aim of reporting on progress by the end of March 2010.
The OFT's decision not to continue its investigation into banks' unarranged overdraft charging terms under the UTCCRs as a result of the Supreme Court judgment followed extensive consideration of the issues including discussions with consumer groups, campaigners, banks, the Government, the Financial Services Authority and Financial Ombudsman Service.
Consumers with complaints about bank charges should look at advice available from the FSA and FOS on their websites.
John Fingleton, OFT Chief Executive, said:
'The Supreme Court judgment was not the outcome we had hoped for and was disappointing for many bank customers.
'Having now considered in detail all the options available to us in light of the judgment, we have decided not to continue what would be a narrow investigation with limited prospects of success.
'But we remain deeply concerned that the market for personal current accounts is not working well for consumers and does not give banks sufficient incentives to compete.
'We are committed to securing significant changes to unarranged overdraft charges going forward, whether through voluntary agreement with the banks or by other means. Customers can play their part by looking for value for money and switching accounts if necessary.'
NOTES TO EDITORS:
1. A document setting out the reasons for the OFT's decision is available here.
2. The OFT announced an investigation under the UTCCRs into the fairness of terms for unarranged overdraft charges in March 2007. It agreed to bring a test case with seven banks and one building society - Abbey National plc, Barclays Bank plc, Clydesdale Bank plc, HSBC Bank plc, Lloyds Banking Group plc (including HBOS), Royal Bank of Scotland Group plc and Nationwide Building Society - on whether the terms of unarranged overdraft charges are exempt from an assessment of fairness under the UTCCRs, with a litigation agreement requiring each side to bear their own costs. The High Court and Court of Appeal found in favour of the OFT and found that the terms did not fall within the exemption. The Supreme Court on 27 November overturned these previous judgments. For more information on the investigation see Personal banking - current accounts.
3. The OFT published its market study into Personal Current Accounts in July 2008 and published a follow-up report in October 2009. For more information see Personal banking - current accounts.
4. Consumers with complaints about bank charges should visit the FSA website and FOS website for more information.
5. On 9 December 2009, in its Pre-Budget Report, the government noted that it "will take action to deliver change if a voluntary approach does not result in a fair outcome for consumers." (p.57). HM Treasury website.
It is far from over.;)Please ignore those people who post on this forum who deliberately try to misinform you. Don't be bullied by them, don't be blamed by them. You know who I mean.
You come here for advice, help and support- thats what I and like minded others will try to do.0 -
... the OFT has today announced its next steps in securing changes...
It's next steps are not to bother, to give up, to accept defeat gracefully.
It may be concerned, but knows there's no prospect of success.
That's not to say it won't express these concerns to the banks (or anyone else that will listen), but three months of flapping of the gums is not going to get any result.
We all know the only way to get a result is via the courts...and the OFT knows there is no chance of success there under current legislation.
Edit:
Btw, the reason I didn't quote the whole article is I read and try to abide by the rules of the service providerTake care over copyright. Use excerpts and links rather than copying long text.
http://forums.moneysavingexpert.com/showpost.html?p=3477005&postcount=9MSE_Martin wrote:COPYRIGHT
Do not copy long text from other publications/websites. This may breach copyright. Instead use short quotes and a link. MoneySavingExpert.com asserts copyright on all comments posted on the boards."Now to trolling as a concept. .... Personally, I've always found it a little sad that people choose to spend such a large proportion of their lives in this way but they do, and we have to deal with it." - MSE Forum Manager 6th July 20100 -
It's next steps are not to bother, to give up, to accept defeat gracefully.
It may be concerned, but knows there's no prospect of success.
That's not to say it won't express these concerns to the banks (or anyone else that will listen), but three months of flapping of the gums is not going to get any result.
We all know the only way to get a result is via the courts...and the OFT knows there is no chance of success there under current legislation.
So I was correct then, Premier.;)
The OFT took that decision based on their ability to assess under UTTCR, fairness, which is what the SC decision was about.
The real problem was that the test case advanced by the OFT and the arguments they used were over such a narrow issue. Many of the other issues can however, probably still be utilised.
No-one, sorry- no regulator or court, has said that bank charges are not unfair. They remain so, the OFT is on record as saying that after the SC result. The judge alluded to the fact they were surprised that other arguments had not been used.
Several options are still very much open:
Utilising new POC's, claims submitted indivdually to banks
Utilising new POC's, claims submitted individually to courts
Class action claim- recent bill facilitates this.
Claims to Financial Ombudsman Service- hardship and revised POC's
Investigation by FSA, assisted by OFT.
New legislation
Joint working between OFT FSA, banks and government.
I would suspect that the banks will be very wary of claims under new POCs actually going to court and we may see the return to what happened previously, with claims being paid as goodwill, to prevent a court decision going against them.Please ignore those people who post on this forum who deliberately try to misinform you. Don't be bullied by them, don't be blamed by them. You know who I mean.
You come here for advice, help and support- thats what I and like minded others will try to do.0 -
It's not over yet. That is not what the OFT said.So I was correct then, Premier.;)
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If you like to think so :rolleyes:"Now to trolling as a concept. .... Personally, I've always found it a little sad that people choose to spend such a large proportion of their lives in this way but they do, and we have to deal with it." - MSE Forum Manager 6th July 20100 -
If you like to think so :rolleyes:
Yep, always different point of views. Lifes rich tapestry and all that.
But, having accepted the OFT has not said that reclaiming is over &
I was therefore correct.
By implication, you were wrong.Please ignore those people who post on this forum who deliberately try to misinform you. Don't be bullied by them, don't be blamed by them. You know who I mean.
You come here for advice, help and support- thats what I and like minded others will try to do.0 -
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But, having accepted the OFT has not said that reclaiming is over &
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By implication, you were wrong.
You appear to have even forgotten what you are arguing over
No one even suggested the OFT should decide what others should do.
I asked:Premier wrote:...If, as they do, the OFT and their huge legal team believe they have no chance of making a legal claim stick, what chance have you?
Or do you have some breaking news suggesting that the challenger is indeed coming off the stool to fight round 2? :rolleyes:"Now to trolling as a concept. .... Personally, I've always found it a little sad that people choose to spend such a large proportion of their lives in this way but they do, and we have to deal with it." - MSE Forum Manager 6th July 20100
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