MSE News: Santander to charge for 'free' business accounts

Jaxer

I sent a formal complaint in about 2 weeks ago and I've received what is obviously the standard "form letter" explaining their right to change the T&C's with 60 days notice, and promising how much better their service will be under the new system.

I can't see any appeal/legal action forcing them to maintain a loss-making service so I don't think it's worth the time/effort taking it to the FOS. I will reply to their letter asking for a specific response to the points I made in my original letter - but in reality, I'm going to transfer to a recently opened local Metro Bank branch.

I think the main point of contention is that if it had originally been marketed as a limited offer, then, other things being equal, some people may have gone to other banks that offered more convenience/facilities.

I've had over 6 years of free banking with them, and I only have a few standing order/direct debits to re-arrange, so I'm not too aggrieved by the change.

janusdesign

Susievintage wrote: »

All positions are of course valid (until we get a definitive answer on the legal interpretation), and reiterating them is not getting us anywhere.

If you have the time and the inclination, I think it's worth complaining, as weight of numbers will only help.

Susie is of course right in one respect, we are going round in circles - but in the vacuum of not knowing what is "right" in a legal sense, that was bound to occur.

as I see it, this discussion is in limbo anyway until the FOS make a ruling - it's patently not going to court; their isn't a political storm brewing about it; Santander are playing with a straight bat in their replies... so I don't see any alternative other than finding an alternate banking solution - whether that's HSBC, RBS or wherever.

I know I sound like a pessimist (or realist perhaps) on this, but I can't see numbers affecting anything.. Santander don't want these free accounts, and *if* they're loss-making, why should they? I would guess they've done their projections and the only ones who will stay are those prepared to pay - so from their point of view, it's win-win... plus if enough of us leave, they may need less staff in the business bank department, so they can make further savings there - perhaps to contribute towards the FOS fees.

janusdesign

DruidDonagh wrote: »

There is one downside on the complaints. It is not just bad for Santander, but also for the environment. It is a waste of paper, unless recycled paper is used, or paper from sustainable forests. I do prefer no paper at all. So please if you feel the understandable urge to complain, type an email or phone them. I would even ask for a reply by email.

:rotfl:
they've been sending me monthly statements for dormant accounts for years... and I bet i've got more of them than Santander will receive complaints about this.

DruidDonagh wrote: »

If that is the case, than the FOS will simply dismiss the complaint and you are none the wiser. It will also mean that the FOS will not charge Santander. The best bet will be the FSA. And to be honest, I doubt that it will stand in court as it is a legal act according to the T&C.

i'm sure someone will correct me if i'm wrong, but I think the FOS £500 fee kicks in whether they judge for or against Santander... as soon as they "consider" the complaint, the fee is applied.

DruidDonagh wrote: »

Things like "free forever" or "free for life" is no more or less than marketing speech.

agreed, but in their marketing, I don't remember it being in quotes - they sold this as free forever as a matter of fact.

anyway, i'll stop now - for fear of a telling off from susie!

JuicyJesus

janusdesign wrote: »

i'm sure someone will correct me if i'm wrong, but I think the FOS £500 fee kicks in whether they judge for or against Santander... as soon as they "consider" the complaint, the fee is applied.

Correct AFAIK. Magpiecottage would probably be the best person to say, but if I recall correctly the only way you get the FOS fee waived is if the complaint is frivolous, vexatious, out of the FOS' jurisdiction or is dismissed without considering its merits.

If they take the Santander cases as one of the latter then they will not be charged.

Justdesserts

cashisking1 wrote: »

Like Lord Denning, I respectfully and gently disagree.
'Consideration' to which you refer, which is an element of a contract, ‘need not be adequate, but must be sufficient’.
In all these cases, the consideration from our end is the promise to deposit funds into the account, which one has done faithfully ever since, month in, month out.
The consideration in return from Abbey, now Santander, before and at the time of the contract was to provide a 'Free Forever' Bank Account.
Even just the promise itself may be enough consideration anyway.
In Dunlop Pneumatic Tyre Co. Ltd v. Selfridge & Co. Ltd [1915] AC 847, Lord Dunedin referred to Sir Frederick Pollock’s definition of consideration. Sir Frederick Pollock defined consideration thus: ‘an act or forbearance of one party, or the promise thereof, is the price for which the promise of the other is bought’. No dough needed.
The terms that changed this promise from FREE came after the inducement was made and the contract was secured. They are all too late as per Thornton v. Shoe Lane Parking Ltd [1971] 2 QB 163.
Many Judges, like Lord Denning and most EU Law usually only requires intention and agreement and the Courts dislike heavy handed entities bullying private consumers.
Yes one can just let 'em screw one and split.
However, if you let this slide, watch out for the next corporate bully 'wallop'.

I agree with you (and like your style!) My letter was waiting for me this weekend when I got back from holiday.

For anyone thinking twice about complaining, here's my letter. Don't give up on this. Banks should not be allowed to break contracts


DearSir

BusinessBank Account
SortCode

I refer to your letter dated July 2012 informing me thatmy free Business current Account would be transferred to a fixed monthly feeaccount.
I opened this account in September 2004. The primary reason I selected this accountwas the promise of free banking forever so long as I stayed within thetransaction limits. This, I thoughtwould free me from having to compare charges and offers in the future. I have never exceeded the proscribedtransaction limits. The term ‘FreeBanking Forever’ was widely used in your advertising and literature and was aclear inducement to open the account.
When Santander acquired Abbey, it took over not only theassets of the company but also its liabilities and commitments. The cost of continuing to provide freebanking, at least for existing business customers, should have been reflectedin any negotiations at the time.
I do appreciate that all financial products include termsand conditions including when and how charges may be imposed or altered. However, these should never negate a materialterm of the original contract, especially one which so clearly defined thenature of the product and its distinctiveness.

I request that you honour the commitment to maintain freebanking for the life my account or make suitable arrangements to compensate mefor my projected losses as a result of these proposed changes.

I await to hear from you.

Justdesserts

janusdesign wrote: »

I was just going through my Abbey National Business "Welcome to direct business banking" manual from 2002 (when I opened my first account)...

It's in the cerise coloured booklet entitled 'The Works' included in the Welcome Pack.

Justdesserts

DruidDonagh wrote: »

There is one downside on the complaints. It is not just bad for Santander, but also for the environment. It is a waste of paper, unless recycled paper is used, or paper from sustainable forests. I do prefer no paper at all. So please if you feel the understandable urge to complain, type an email or phone them. I would even ask for a reply by email.

Having said that.

If that is the case, than the FOS will simply dismiss the complaint and you are none the wiser. It will also mean that the FOS will not charge Santander. The best bet will be the FSA. And to be honest, I doubt that it will stand in court as it is a legal act according to the T&C.

And please do remember that Santander is a different entity from abby and the other banks they took over. And it also stands to reason that therefore Santander is in no way obliged to keep those promises.

Things like "free forever" or "free for life" is no more or less than marketing speech.

It may stand to reason, DruidDonah, but not in law. The acquiring company takes over any existing liabilities.

We need to stand together on this

bundly

Susievintage wrote: »

if you don't, and just want to move on to another bank, then of course that's fine too - although personally I don't know where to start looking for a reliable alternative, if it turns out that any agreement you sign with any bank can be varied by them at any time!

Well isn't HSBC a good start, then if they start charging, move on?

bundly

Justdesserts wrote: »

DearSir

BusinessBank Account
SortCode

I refer to your letter dated July 2012 informing me thatmy free Business current Account would be transferred to a fixed monthly feeaccount.

To whom should we email this letter?

Susievintage

bundly wrote: »

To whom should we email this letter?

Ah, I'm afraid that it's not easy to email - you'll need to do snail mail in order to get the written paper trail. I may be wrong, and perhaps someone has had better luck than I in getting an email response from Santander...?

But I posted my letter to the Santander complaints people - yet to receive what will doubtless be a form reply.