Something everyone should consider

crazyworld_2

Hi all, I posted this over at the CAG forum. I think everyone should consider the following seriously:

Consumer Protection Act 1987:

"2.1.1 The Consumer Protection Act 1987 makes it an offence to indicate a price for goods or services which is lower than the one that actually applies. You should not therefore show one price in an advertisement, website, window display, shelf marking or on the item itself, and then charge a higher price at the point of sale or checkout. In addition, specific regulations apply to particular types of sales and ways of selling—eg retail sales (including the Internet), sales of food and drink which involve service, distance contracts, resale of tickets, package travel, etc. Your local Trading Standards Services or Home Authority will be pleased to advise you on the current regulations that are relevant to your business and of any good practice guidance which is also relevant.

2.2 Incomplete information and non-optional extras

2.2.1 Make clear in your price indication the full price consumers will have to pay for the product. The consumer should always be fully aware of the total cost including eg postage, packing, delivery charges, insurance, etc. before they commit themselves to the purchase. Some examples of how to provide this information in particular circumstances are set out below."

The Trade Descriptions Act 1968 - Guidance Note from Department of Trade and Industry Consumer and Competition Policy Directorate:

Definition and Marking Orders

Powers are available under the 1968 Act by which definitions of the words traders use to describe their goods or services could be laid down. Orders could also be made requiring goods to be marked with or accompanied by information necessary for consumers of the goods, or for such information to appear in any advertisement for the goods.

I have a couple of suggestions relating to bank charges and use of unauthorised overdraft facilities, what do you think?

A possible true description of charges:


Customers should be aware that where a charge is applied, customers will experience an additional loss of funds. Customers depositing by cash, cheque or other methods will not only lose a certain proportion of that deposit due to the charge being applied, but will also need to make an additional deposit to bring their balance up to where it would have been had the charge not been applied.

eg.

I may have had an account balance of +£10 on day one, on day 2 a penalty charge of £30 is debited from my account (with no authorised overdraft) taking me £20 overdrawn. On day 3, I was unaware of the penalty charge, and deposited £50, instead of having a balance of +£60, I now have a balance of +£30. I would need to make a further deposit of £30 to bring my balance up to where it should have been, had the bank not debited the £30 charge from my account.

You will therefore in this instance effectively lose double the amount of the charge.

A possible true description of Unauthorised overdraft facilities.

An unauthorised overdraft may only be used to recover our penalty charges from delinquent customers. Cheques, and direct debits will not be covered by the unauthorised overdraft facility, it is for our use only, and intended to allow us to add extra interest and charges on what could otherwise possibly be a balance in positive territory. This is a non optional extra provided at our convenience, for our convenience.

LozBingley

crazyworld wrote: »

Hi all, I posted this over at the CAG forum. I think everyone should consider the following seriously:

Consumer Protection Act 1987:

A possible true description of charges:

Customers should be aware that where a charge is applied, customers will experience an additional loss of funds. Customers depositing by cash, cheque or other methods will not only lose a certain proportion of that deposit due to the charge being applied, but will also need to make an additional deposit to bring their balance up to where it would have been had the charge not been applied.

eg.
I may have had an account balance of +£10 on day one, on day 2 a penalty charge of £30 is debited from my account (with no authorised overdraft) taking me £20 overdrawn. On day 3, I was unaware of the penalty charge, and deposited £50, instead of having a balance of +£60, I now have a balance of +£30. I would need to make a further deposit of £30 to bring my balance up to where it should have been, had the bank not debited the £30 charge from my account.

You will therefore in this instance effectively lose double the amount of the charge.

The charge is £30 - you have lost £30! If you add £30 to your account to bring it back to where it should have been thats still only £30 that you are down not £60 because the £30 you add was yours! If the bank gives you the £30 back the account now has £30 more in it because you put it there.

Where did you learn maths? :rotfl: Down the pub? :beer:

Beate

The same questionnable maths was put forward in this thread by the OP:
http://forums.moneysavingexpert.com/showthread.html?p=5488334#post5488334

Saying it twice still doesn't make it correct, I am afraid.

crazyworld_2

It seems it isn't my maths which is flawed.

Ok, i'll use the same example.

At a balance of -£20 following the deduction from your balance of the £30 charge you deposit £50.

You have effectively lost £30 of that £50 deposit. In effect, you've only actually deposited £20 from what your balance should have been (+£10)

So, would you not agree here that you've already lost £30? That seems like pretty basic maths to me.

I'll give you an even better example, I challenge you to go through all your statements, work out exactly what your balance would have been had the charges not been imposed in the first place.

Now, after you've done that you'll discover the account balance you should have now.

An example for you from a real case, without charges, a balance should be +£500, instead your balance is at -£500.

The difference there is £1000 agree?

However, when you add up all your charges, they only work out at £800.

How did that additional £200 get there??

If my maths is wrong, how do you account for that?

chipbeck

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If only we could work out how you arrive at your destinations we would all be quids in.

crazyworld_2

As I said above Chipbeck, go through all the statements you have available.

use the figures provided in your statements, and ignore all the charge amounts (this will take some time, but it will shock you!)

By the time you have reached today's date you should have the figure for an account balance you would have had, if the charges had not been applied in the first place.

Now you can work out the difference between the balance you should have now, and the balance you actually have. (This calculation however does not take into account a certain percentage of the charges which are hidden due to deposits made) which is why the difference between the balances looks so strange in comparison to the actual charges.

scottjack

I really don't see where you are getting this from.

If I have £25 took from my account, then I want £25 back. If my account is -£10 and I have £25 taken off, then that leaves me £35 down which I have to replace but the original £10 of that is still my own responsibility!

crazyworld_2

Yes, Scottjack, I agree, the original £10 is your responsibility.

However, say you deposited £50 into the account when your balance was at -£10, that would mean your balance should be at +£40, right?

What's the difference between having a balance of -£35 and +£40? £75 right?
However, as the charge was taken before you made the £50 deposit, then you realise that £25 of that deposit will be eaten up by the charge amount, don't you?

You've then got to make an additional deposit of £25 to cover the difference. In effect, although your statement will show you're only £25 down, you've already lost £50, and after depositing £75 in total to take account of this, your balance now stands at +£40.

If you'd deposited £75 to the original balance of -£10, your balance should be +£65, right? No matter how much you deposit, you will always be making a loss, and when further charges are applied, the cumulative effects of that are that you'd notice by going through your statements that no matter how much you deposit, if further charges are applied, the difference between what your balance should be, and what it actually is increases, therefore, your losses also increase. At least that's what i've found in my own case.


I hope that helps you to understand what i'm saying better.

Beate

No it doesn't because it just does not make any sense.

LozBingley

crazyworld wrote: »

Yes, Scottjack, I agree, the original £10 is your responsibility.

However, say you deposited £50 into the account when your balance was at -£10, that would mean your balance should be at +£40, right?

What's the difference between having a balance of -£35 and +£40? £75 right?
However, as the charge was taken before you made the £50 deposit, then you realise that £25 of that deposit will be eaten up by the charge amount, don't you?

You've then got to make an additional deposit of £25 to cover the difference. In effect, although your statement will show you're only £25 down, you've already lost £50, and after depositing £75 in total to take account of this, you're balance now stands at +£40.

If you'd deposited £75 to the original balance of -£10, your balance should be +£65, right? No matter how much you deposit, you will always be making a loss, and when further charges are applied, the cumulative effects of that are that you'd notice by going through your statements that no matter how much you deposit, if further charges are applied, the difference between what your balance should be, and what it actually is increases, therefore, your losses also increase. At least that's what i've found in my own case.


I hope that helps you to understand what i'm saying better.

Where are you getting this -£35 from :rotfl:

OK Here goes

I have £20 in my account
I take out £30 (oops) I'm now at -£10
The bank charges me £30. I'm now at -£40
I put in £50 and I'm at +£10 which is down by £30 that the bank took

You are saying the bank owe me £70 because the difference between +£40 (what my balance should be) and plus the charge of £30 = £70!

Lets change the order now

I have £20 in my account
I take out £30 (oops) I'm now at -£10
I put in £50 and I'm at +£40
The bank charges me £30. a day later and I'm now at +£10, the same place which is down by £30 that the bank took

OK now lets say I did it all right!

I have £20 in my account
I put in £50 and I'm at +£70
I take out £30 and I'm now at +£40

The bank don't charge me or owe me £40! The balance on the account is £40 and should not have figured in your calculation at all! :rotfl:

LozBingley

Beate wrote: »

The same questionnable maths was put forward in this thread by the OP:
http://forums.moneysavingexpert.com/showthread.html?p=5488334#post5488334

Saying it twice still doesn't make it correct, I am afraid.

Its the same question as its the same person asking it - Mr Crazyworld :rotfl: