Bank Charges Charter/Petition Discussion

Newbold

Not a popular view here of course, but all this is achieving is a structure which will involve EVERYONE being charged by the banks for operating current accounts - just as it used to be a few years ago. The banks will make their profits somewhere (some people seem to think they're going to operate as charities) and if they can't make them by charging people who choose to overdraw without authority they'll make them from the vast majority of people who operate their accounts within agreed limits and currently pay no charges.

If you choose to overdraw without the bank's agreement you're effectively stealing their money. Why shouldn't they charge you for it? You have a choice. You know the rules, you know the charges - just don't overdraw.

I'm just waiting for the whingeing to start once the banks start charging everyone £5 per month just to operate the account. First Direct have started already and the rest will follow. Thanks, Martin - this is going to make you very unpopular in the long run.

TANZARELLI

Newbold wrote: »

Not a popular view here of course, but all this is achieving is a structure which will involve EVERYONE being charged by the banks for operating current accounts - just as it used to be a few years ago. The banks will make their profits somewhere (some people seem to think they're going to operate as charities) and if they can't make them by charging people who choose to overdraw without authority they'll make them from the vast majority of people who operate their accounts within agreed limits and currently pay no charges.

If you choose to overdraw without the bank's agreement you're effectively stealing their money. Why shouldn't they charge you for it? You have a choice. You know the rules, you know the charges - just don't overdraw. Sorry but I disagree with this comment, especially if the banks know when regular things happen such as your wages are going into your account (as they do on the same day every month) and the day before they return a payment, because you are short of a couple of pounds. This is purely unreasonable and is designed to allow them to make a profit. Another example which is the opposite of this is when they take out their charges and this takes you overdrawn, causing more charges to be incurred. If they can take you overdrawn for the purposes of their charges then they should have some flexibility to do it prior to a payday which happens every month.

I'm just waiting for the whingeing to start once the banks start charging everyone £5 per month just to operate the account. I don't have a problem with this as they are providing me with a service which I am happy to pay for and I think others should to. What I don't agree with is them using the fact that some people (often on benefits) who have a lot of outgoings and sometimes for whatever reason don't have sufficient funds in their account get fleeced buy the banks getting them into more and more debt.

First Direct have started already and the rest will follow. Good bring it on I say a monthly charge is fine by me, however last month I had the last bit of my wage £280 taken out of my account in charges causing me to then be overdrawn by £5.80 which will incur more charges and you cant tell me that this £280 would ever be the amount a bank would charge me for operating an account. Lets get real here.

Thanks, Martin - this is going to make you very unpopular in the long run.

P.S you don't work for a bank do you?

MSE_Martin

A couple of answers:

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It is a shame that 'the Big Three' chose to overlook the smaller consumer groups when discussing this Charter. Legal Beagles and Consumer credit Support, have members who have been through the grinder with the banks and credit card companies and could have given some valuable input into this Charter.

I'll be honest with you i've not heard of legal beagles or consumer credit support. If they'd like to join in - they'd be more than welcome. This has been up on the site here in various guises asking for consultation for nearly two weeks. Sadly no one from those organisations contacted me to offer their support and help. The aim is to provide an inclusive body of campaigning groups (though not with claims handlers). And they'd be welcome.

As there are a number of posts above from people with them in their sign-off; I can only presume there's been some lobbying posts on those sites. Sadly no one thought to get in touch earlier or we could've sorted it.

On the £5 issue

The phrasing of this is quite deliberate. The £5 estimate is done because when analysed a £2.50 to £4.50 costing was given. £5 is a round simple number; remember on credit card the OFT said £12 - which we all believe is too high.

This certainly isn't a document of appeasement; its the opposite. Yet we can't do this without remembering at the moment the FSA,OFT and Banks have the agenda; we need to bring it back and a deliberately simple document that people can rally behind is very important.

I'm saddened those above who support reclaiming don't feel they can support the charter based on a technicality. As much consultation as possible was done for it and we've done our best to get a charter than covers the main points without seeming unreasonable. I would ask you to look again at the bigger picture.

The 'You'll be unpopular for this in the long run' point

I didn't do this for popularity. I did it because I believe the banks are breaking the law and I've been persuaded of the enormous damage the penalty charges structure does to many people with vulnerable finances.

Yet on the premise of "the end of free banking." I've heard this for a year, the only change has been 'first direct' who introduced a fee based on certain conditions. This wasn't done because of bank charges reclaiming; it was done to bring First Direct a more affluent customer (hence the income threshold) and to get rid of all its dormant accounts caused by it running lots of "sign up and get £25" promotions.

No other banks has introduced fees and any thank do would find they lost huge numbers of customers. The bank account market is ultra competition - just look at the top accounts offering £100 cash if you sign up.

Even if every clause in the charter was enacted; the cost for the banks would be £10 billion (sadly its unlikely to be this); while it sounds right for mere mortals, this is only a quarter of one years collective profits (profits not turnover!). It can be afforded!

Martin

TANZARELLI

Martin could I ask what your thoughts are on the limitation issue?

Newbold

MSE_Martin wrote: »

A couple of answers:

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The 'You'll be unpopular for this in the long run' point

I didn't do this for popularity. I did it because I believe the banks are breaking the law and I've been persuaded of the enormous damage the penalty charges structure does to many people with vulnerable finances.

Yet on the premise of "the end of free banking." I've heard this for a year, the only change has been 'first direct' who introduced a fee based on certain conditions. This wasn't done because of bank charges reclaiming; it was done to bring First Direct a more affluent customer (hence the income threshold) and to get rid of all its dormant accounts caused by it running lots of "sign up and get £25" promotions.

No other banks has introduced fees and any thank do would find they lost huge numbers of customers. The bank account market is ultra competition - just look at the top accounts offering £100 cash if you sign up.

Even if every clause in the charter was enacted; the cost for the banks would be £10 billion (sadly its unlikely to be this); while it sounds right for mere mortals, this is only a quarter of one years collective profits (profits not turnover!). It can be afforded!

Martin

Martin, I applaud your general approach to money saving, but you're wrong on this one, and it will rebound on you once the vast majority of people who currently benefit from free banking realise who was responsible for their losing it.

Banks are there to make profits. No profits - no banks. Charging used to be the norm (unless you had a minimum balance of around £100 - more like £500 in today's terms) some years back, and the only reason it isn't now the norm is that banks have found other ways to charge. Take those other charges away and we'll all have to pay again. Yes, there is competition, but no matter how much competition there is they'll still want to keep up the current level of profits somehow. Life's like that - they can't just report dramatically lower profits to shareholders or the directors' jobs would be on the line. They're not in it for charity, and you're being naive if you think they're not going to find other ways to charge.

You might be a hero to some people, but there are many more of us who see this campaign as something which is going to backfire horribly on all of us - and you too.

TANZARELLI

The fact of the matter is that penalties are irrecoverable under common law but also in equity.

Charges that provide a service yes agreed then banks can make profit from these. However if they have puposely reworded their T&Cs to cloak and veil the charges into something they are not then this to me proves they knew their charges were unlawful and therefore proves to me they have been deliberately concealing their charges for x amount of years. I think the banks underestimated the bank charges debate and now are trying to cling on to this money by coming up with the service arguement.

We should be looking to re-claim all charges not just the recent last 6 years.

20. Lord Denning MR explained the meaning of the expression "concealed by the fraud of [the defendant or his agent]" in King v Victor Parsons & Co [1973] 1 WLR 29, 33-34 as follows:

• "The word 'fraud' here is not used in the common law sense. It is used in the equitable sense to denote conduct by the defendant or his agent such that it would be 'against conscience' for him to avail himself of the lapse of time. The cases show that, if a man knowingly commits a wrong (such as digging underground another man's coal); or a breach of contract (such as putting in bad foundations to a house), in such circumstances that it is unlikely to be found out for many a long day, he cannot rely on the Statute of Limitations as a bar to the claim: see Bulli Coal Mining Co v Osborne [1899] AC 351 and Applegate v Moss [1971] 1 QB 406. In order to show that he 'concealed' the right of action 'by fraud', it is not necessary to show that he took active steps to conceal his wrongdoing or breach of contract. It is sufficient that he knowingly committed it and did not tell the owner anything about it. He did the wrong or committed the breach secretly. By saying nothing he keeps it secret. He conceals the right of action. He conceals it by 'fraud' as those words have been interpreted in the cases. To this word 'knowingly' there must be added recklessly': see Beaman v ARTS Ltd [1949] 1 KB 550, 565-566. Like the man who turns a blind eye. He is aware that what he is doing may well be a wrong, or a breach of contract, but he takes the risk of it being so. He refrains from further inquiry least it should prove to be correct: and says nothing about it. The court will not allow him to get away with conduct of that kind. It may be that he has no dishonest motive: but that does not matter. He has kept the plaintiff out of the knowledge of his right of action: and that is enough: see Kitchen v Royal Air Force Association [1958] 1 WLR 563. If the defendant was, however, quite unaware that he was committing a wrong or a breach of contract, it would be different. So if by an honest blunder he unwittingly commits a wrong (by digging another man's coal), or a breach of contract (by putting in an insufficient foundation) then he could avail himself of the Statute of Limitations" (emphasis added).

• http://www.bailii.org/uk/cases/UKHL/2002/18.html

• Cave v. Robinson Jarvis & Rolf [2002] UKHL 18 (25th April, 2002)

brightonman_2

Newbold wrote: »

Banks are there to make profits. No profits - no banks.

Newbold -- please don't be so patronising. Nobody here imagines that banks aren't in business to make profits. What we find objectionable is the creation of excessive profits based on unlawful penalty charges meted out to people who are often the most vulnerable. We champion Martin because he, and a few others like him, have given a voice to those least able to defend themselves against the vast corporate bodies that banks have become..

I've never deliberately gone overdrawn in my life. I happen to run a business, and the bank charges all my transactions anyway, so the concept of 'free banking' is somewhat foreign to me, and those of us who run businesses have had to carry the cost of free banking for personal accounts for years. Personally, I'd rather see charges on banking that can be itemised and verified, rather than the absurd structure of penalty charges that currently exists. I am one of those who has suffered multiple charges in a single month as a result of the bank's own charges taking me much further into debt than I would have been, and I'm still furious about it.

As for £5, I think that's a realistic compromise., and actually still very generous to the banks. We could argue for years about a lower figure, closer to the actual 'true' cost to the banks, but such wrangling would serve nobody but the banks, who could drag it out forever.

TANZARELLI

brightonman wrote: »

As for £5, I think that's a realistic compromise., and actually still very generous to the banks. We could argue for years about a lower figure, closer to the actual 'true' cost to the banks, but such wrangling would serve nobody but the banks, who could drag it out forever.

I agree that it is still very generous and that is why I disagree with it. If we agree to it then we are still saying they can profit from penalties which they can't. If we accept it then in the future decide to bring an action will we have a leg to stand on?

I_Perseus

Quote:
<TABLE cellSpacing=0 cellPadding=4 width="100%" border=0><TBODY><TR><TD class=alt2 style="BORDER-RIGHT: 1px inset; BORDER-TOP: 1px inset; BORDER-LEFT: 1px inset; BORDER-BOTTOM: 1px inset">It is a shame that 'the Big Three' chose to overlook the smaller consumer groups when discussing this Charter. Legal Beagles and Consumer credit Support, have members who have been through the grinder with the banks and credit card companies and could have given some valuable input into this Charter. </TD></TR></TBODY></TABLE>
I'll be honest with you i've not heard of legal beagles or consumer credit support. If they'd like to join in - they'd be more than welcome. This has been up on the site here in various guises asking for consultation for nearly two weeks. Sadly no one from those organisations contacted me to offer their support and help. The aim is to provide an inclusive body of campaigning groups (though not with claims handlers). And they'd be welcome.

As there are a number of posts above from people with them in their sign-off; I can only presume there's been some lobbying posts on those sites. Sadly no one thought to get in touch earlier or we could've sorted it.

Hi Martin, and thanks for the opportunity to have open discussion about this.
The above quote; One of 'The Big Three' (CAG) were contacted by www.consumercreditsupport.co.uk some time ago, offering support and input to this 'combined' approach. Sadly 'We' never heard anything back! That - is a shame!

...providing a simple solution of £5 compared to the current horrors of £35 has an elegance to it.

Remember this is a 'broad-church' document of three different groups. If we got everything in the charter I'd be whooping for joy; though of course at the edges people will differ.

Two drafts of the charter were here on the site for suggestions and discussions; but there comes a point when you just have to go for it.

Martin

A Charter - presented to the UKs major regulatory bodies and for consideration by the UKs financial institutions, which is hoped to be adopted as a standard is most definitely deserving of absolute clarity and accuracy.
I'm sorry to disagree with your quote, but to offer a 'Near enough' document that has the potential to affect every UK consumer in banking is a huge responsibility.
Which leads me to...

On the £5 issue

The phrasing of this is quite deliberate. The £5 estimate is done because when analysed a £2.50 to £4.50 costing was given. £5 is a round simple number; remember on credit card the OFT said £12 - which we all believe is too high.

The OFT and FSA/FOS will be arguing their case using sections 5, 8, 13 and Schedule 2 of the UTCCR1999.
To propose a 'nominal' figure of anything other than genuine pre-estimated or
liquidated costs whilst arguing points of law in a High Court is absurd in my opinion.
'We' the consumer, proffering a 'Charter' advocating the use of an estimated or nominal charge figure is contradictory in the least, and undermines the test case principles, and the argument of every single penalty charge case.
This is an opportunity to ask/plead/persuade the regulatory bodies to enforce and sanction, rather than 'appease' - yes appease the financial institutions.

I'm saddened those above who support reclaiming don't feel they can support the charter based on a technicality. As much consultation as possible was done for it and we've done our best to get a charter than covers the main points without seeming unreasonable. I would ask you to look again at the bigger picture.

Please see above - the bigger picture is what the reclaim era has relied on throughout. Technicalities are what the court consider in every claim that has been processed, and won.
Why change a working method?

Tanzarelli's post regarding concealment, statute of limitations and 'cloaking/disguising penalties by virtue of another name' are extremely relevant points to be considered, else we should sell out the opportunity of using section 32 of Limititations Act!

There is no mention of vulnerable, hardship or benefit claimants what-so-ever - that's a big miss!

Fiinally, as many others have said, you are a loud voice in support of the consumers rights, and credit where it is due, but please consider further the impact of the Charter as is, and the need to 'get it right from the start'.

Regards
Perseus

Moderator Consumer Credit Support, member CAG, MSE, Penalty Charges Forum.

Dragonlady_2

MSE_Martin wrote: »

A couple of answers:

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I'll be honest with you i've not heard of legal beagles or consumer credit support. If they'd like to join in - they'd be more than welcome. This has been up on the site here in various guises asking for consultation for nearly two weeks. Sadly no one from those organisations contacted me to offer their support and help. The aim is to provide an inclusive body of campaigning groups (though not with claims handlers). And they'd be welcome.

As there are a number of posts above from people with them in their sign-off; I can only presume there's been some lobbying posts on those sites. Sadly no one thought to get in touch earlier or we could've sorted it.

On the £5 issue

The phrasing of this is quite deliberate. The £5 estimate is done because when analysed a £2.50 to £4.50 costing was given. £5 is a round simple number; remember on credit card the OFT said £12 - which we all believe is too high.

This certainly isn't a document of appeasement; its the opposite. Yet we can't do this without remembering at the moment the FSA,OFT and Banks have the agenda; we need to bring it back and a deliberately simple document that people can rally behind is very important.

I'm saddened those above who support reclaiming don't feel they can support the charter based on a technicality. As much consultation as possible was done for it and we've done our best to get a charter than covers the main points without seeming unreasonable. I would ask you to look again at the bigger picture.


Martin

Martin,

We did offer our input via CAG regarding the Charter and they ignored our offer. When we founded Consumer Credit Support, (we were originally with CAG and were the main contributors of the CCA thread), we decided we wanted to take the Consumer Credit Act regulations a bit further and this we have done.

We have now been live for seven weeks, only number 200 so far.

Legal Beagles are the another group which wnet live about a week before we did.

The Charter is generating considerable discussion on out site and the majority of members do not agree with the Charter, as we have dicovered we can claim further back than six years, some claims are far more complex than others and each claim is looked at before being submitted so the banks, credit card companies and finance house have no wriggle room.

If this means that the so called 'free banking' comes to an end, think of it this way banking was never 'free'. it was subsidised by the consumer who had not control over the bankis taking their charges before any other debits happened. I was appalled by this practise. The banks state that they don't have to process in any particular order, and it has been noticed that they process to maximise their profits first. I am trying to be circumspect with this, but the banks do no consumer a favour.

I am so glad I was able to prove I had corresponded with the bank in the very early days 1998 querying the so called charges and I kept their 'laisefair' 'reply. It came back and bit them on the backside big time.

The banks also never considered some of us have para legal training and can work our way through legislation and what was meant at the time these Acts, were written. We are now educating the DJ's.

Section 85 is very interesting and every credit company is breach of the Section of the Act. If they think the bank charges opened the floodgates wait until this one hits full force. People are getting all their interest back because of non-compliance. This is not the place for this discussion. If anyone is interested, you can come and have look and see what is happening.

Martin, I appreciate you saying that you asked for input, but sadly for us at CCS we missed the boat for several reasons.


Thank you for allowing forum space.