MSE News: CONFIRMED - OFT gives up bank charges battle

moo_cow

If you don't want to use the bank account and if you do so solely because your employer refuses to pay you in cash, simply withdraw all of your money after payday and do not use standing orders, direct debits, cheques and debit cards ever again. Better still, withdraw it by cheque 20p at a time .

whilst I think it would be better to do this George, this is unfortunately not always possible. Many companies no longer accept cash payments for things. I have come up against this on many an occasion when purchasing insurances for example. It's direct debits, standing orders or debit/credit card payments only. Also, another thing which should be investigated is the fact that consumers who have pre pay meters or pay in cash when their quaterly bills come in are heavily penalised. BT for example. £4.50 payment processing fee! But that's another subject entirely.

Can I also just point out to the clever jackasses who accuse people of borrowing money that's not theirs.... I do not borrow money on unauthorised overdrafts. My charges were just over £100 for returned direct debits Which actually amount to less than 10% of my £1200 charges the bank have taken. The rest are bank charges on top of bank charges. HOW IS THAT FAIR & LEGAL? And by the way, I ran my finances superbly with no problems at all. A sudden drop in income of over 40% has caused our hardship. In this time of uncertainty it would do to remember that no one is safe!

The_White_Horse

discodave247 wrote: »

First post on the site, but I am amazed to see the comments from some people who are rubbing their hands with glee at the news that the OFT is dropping the bank charges case. Whilst I agree everyone is entitled to there own opinion, the majority of people don’t need to be told that this is great news; surely the sensible approach would be to stop being so short sighted and recognise that the amount charged should be fair and proportionate. I have also noticed with amazement comments such as “people should learn to live within their means” however at the start of the year, the company I worked with went in to administration; I didn’t receive a single penny. I paid what I could but was charged for going over my overdraft, missing payments etc. I would have considered myself as living within my means while I was working, but on the second month of little or no income, I can fully sympathise at being charged £35 for missing a payment due to insufficient funds and a further £28 for going over my overdraft, and all this for the measly 57p over my overdraft limit.

Let’s look at this rationally, we are only looking for a fair and reasonable charge amount, the banks have already changed the cost and structure of their charges which would intimate that they think they are wrong.

I agree there should be a penalty for misuse, but that fee should not be unreasonable.

This happened to me once. Again, you simply cancel every direct debit the day you are made redundant. You then pay each bill on a priority basis - mortgage, council tax, secured loans, and so on.

If you get work, start the dd again. If not, you have to do what you have to do. the bills have to be paid, and you may lose your sky, phone, etc, but if you have no money to pay, you have no money to pay. why incur bank charges as well?????

kittiej

Yes I suppose not everyone went spend crazy, some people just hit upon hard times.

It can also be true that to pay by cash means paying more, but then again like with insurances they charge you to pay by monthly DD, so there's a downfall to both.

Wouldn't it be great if the banks did listen to their customers, oh no didn't the "listening bank" go bust or something lol.

UncleJaysus

Also, the problem here is, some people think this is an argument about how people run their accounts. It's not. People need to stop coming along and saying "tough, you shouldn't have got into debt". This is like saying to a mugging victim, "well, you should've known better than to go down that alleyway" or like saying to someone who's house has been burgled "well, you shouldn't have gone away at Christmas - everyone knows burglaries go up at Christmas".

People seem to think that if people can't look after themselves and their own banking, then it's OK for banks to rip them off. It's not. Even the stupid need protecting. Not that I'm saying people who get into money trouble are stupid, far from it - people get into money trouble for all sorts of valid reasons. The point I'm making, is that even for those who don't, they don't deserve to be taken advanage of because they don't have some sort of instinct for finance.

UncleJaysus

With Rage Against the Machine's recent chart victory fresh in memory, perhaps we could set up something similar for banking. After all, if the little guy can influence the pop charts, then maybe such banding together could be used to create an even more meaningful message?

I'm just thinking off the top of my head here, but maybe we could get anyone who's with one of the big banks (those involved in the test case) to sign up and pledge to leave their bank and take their money, wages, cards etc to a smaller bank on a day or time period to be decided.

If enough people joined this, then the chosen day/week/month where everyone emptied and closed their accounts could mean chaos for the banks.

barry_the_bike

After the recent ruling (22 Dec 09) isn't it about time we moved on.Enough money has been wasted by OFT to try and defend people who are incapable of running their bank accounts correctly.Simple solution KEEP IN THE BLACK = NO CHARGES!!!!!!!

UncleJaysus

alexjohnson wrote: »

With respect, if this argument were about banks taking advantage of the poor and unsophisticated I would have a lot more time for it. That there may be poor and unsophisticated people wrapped up in it may be true but the people who post on this board are frequently obviously neither. They come up with elborate legal arguments to justify their point of view. There's frequently an admission that they just didn't pay attention. And, elements of these boards have functioned as a mutual support network allowing people to feel that they are a victim, and "deserve" to reclaim. The obviousness of this is precisely what is annoying to many of us. I really have no beef with someone (someone with a PC at home or an office job!), wanting to fire off a letter in the hope of getting a big payout. That seems almost to go to the ehart of the MSE ethos! I just think for many of these people to cloak themselves in moral outrage on behalf of some imagined group of people - whom they also constantly patronise, assuming that to have a lower income means you can't be expected to manage your own finances - is a bit rich.

Irrelevant.

The point remains: banks shouldn't be able to rip off the poor, regardless of the attitudes of people on here.

nickmack

I must say this news doesn't come as much of a surprise as the Supreme Court decision. It appears the OFT sees little merit in launching more expensive action on another specific legal point and would rather go down the route of discussions with the banks.

Hopefully, the banks will be more willing to talk now, as their previous arrogant attitude seems have been melted a little since the court case and campaign. However, progress has already been made as many banks have already reduced charges and made charges clearer, although maybe not quite fair in the eyes of some.

I'm not fully confident in the OFT to be able to negotiate effectively going forward. They have made previous concessions and some poor decisions in relation to this issue already, but they do believe there is still work to be done to bring banks into line, so let's see them follow this through.

For those who find this news music to their ears because they believe they've been 'saved' from having to pay monthly fees, don't assume the two are mutually exclusive. There's every chance there will still be more restructuring of charges which could include account charges.

taxiphil

LordLee wrote: »

I just cannot help thinking that some dodgy deals were done between government, courts and banks. The government is helping the banks with handouts and cutting bonuses... they would not want to see banks having to shed out millions in reclaimed bank charges. I reckon there's more to this than meets the eye.

I think you've got it in a nutshell there.

This was never really about the legal technicalities of reclaiming unfair bank charges; this was the establishment closing ranks in the face of a peoples revolution which threatened to put too much power into the hands of men of straw. They were rattled by the sudden empowerment of the masses, thanks to the internet and the likes of Martin Lewis. The little man isn't supposed to unite en masse and use the legal system to his advantage. It would cause too much of a socio-political revolution. They wanted to resurrect barriers between the little man and the language of law and big business.

Be in no doubt that government ministers, the Law Lords and the banks (whether nationalised or not) are all part of the establishment. They're all part of a cosy club and live in each others' pockets. You only have to pick up any copy of Private Eye to see the favours, back scratching and corruption that goes on, day in day out.

Underneath it all, they firmly believe that the role of the little man is to keep the banks awash with profit. That's what it’s all about, and that’s what it's always been about. The poor must protect the wealthy. They weren't suddenly about to let that change. As the events of 2009 have shown, the establishment view us with utter contempt – they feel fully entitled to help themselves to limitless sums of our cash (in a time of recession), whether it be to bail out the bankers and preserve their bonuses and pensions, or to furnish MPs' houses into palaces fit for a King.

The OFT are just a toothless excuse for a regulator, like OFGEM, OFCOM, the FSA and all the rest of them, set up by the government to create the illusion that there’s someone looking out for the consumer. But they deliberately haven’t been given the necessary statutory powers, or the funding, to enable them to do a half-decent job of regulation.

moo_cow

With Rage Against the Machine's recent chart victory fresh in memory, perhaps we could set up something similar for banking. After all, if the little guy can influence the pop charts, then maybe such banding together could be used to create an even more meaningful message?

I'm just thinking off the top of my head here, but maybe we could get anyone who's with one of the big banks (those involved in the test case) to sign up and pledge to leave their bank and take their money, wages, cards etc to a smaller bank on a day or time period to be decided.

If enough people joined this, then the chosen day/week/month where everyone emptied and closed their accounts could mean chaos for the banks.



See now, that's the spirit!!!! Exactly what we should do. Remember the poll tax uproar? It's the only way to get the message across. If we don't stick up for us then who else is going to do it. And it's certainly a peaceful demonstration. No one could say otherwise. I'm with Unclejaysus on this one.