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Thursday, 22 March 2007
Tuesday, 20 March 2007
Two new forces enter the bank charges fray
BACK in January, Your Money ran a piece about bank charges and how to reclaim them.
Since then, the campaign to stamp out excess bank charges has mushroomed. At one stage in February over 5,000 people a day were calling the financial ombudsman for advice.
As yet there has been no formal advice from the authorities to banks to trim their charges but, as anger grows, two powerful new forces have entered the fray on consumers' behalf.
The Office of Fair Trading (OFT) is due to issue a report shortly in which they are expected to say that bank charges are far too high. It's unclear what ceiling they will attempt to set although when you consider that the actual cost of a bounced cheque or a customer going beyond their overdraft limit is somewhere between £2.50 and £4.50, and charges can be as high as £35, there is some room to manoeuvre. In a situation where city bank Credit Suisse estimates banks make over £1.2bn from charges, few customers will shed tears, particularly when you consider that profits at high street banks have surged to £40 billion - an increase of 40%.
Any changes to charges will not happen retrospectively of course, and if you're still unhappy with the way the bank is responding to your complaints, then a phone call to the Office of the Financial Ombudsman might be in order. They have proved extremely helpful to many consumers not just in claiming back unfair charges, but also interest accrued on those charges
As the number of consumers protesting against these charges has grown, so have the banks' defences. In order to claim back charges, customers need a list of them and banks are allowed to charge up to £10 for six years' worth. However, although the maximum amount payable to obtain this list is covered under the Data Protection Act 1998, statements are not. And according to thisismoney.co.uk, banks have taken to offering customers their old statements instead of the charge list and charging £5 for each one. This can lead to a bill running into hundreds of pounds.
Other ways banks have started to fight back include threatening to close customers' accounts, or even switching accounts away from free banking to accounts which have standing charges even if you stay in credit. So before you embark on trying to reclaim your original charges, it might be worth opening an account elsewhere just in case the worst should happen.
And do check your bank statements for any evidence of new fees.
The OFT report comes hard on the heels of their success in limiting fees for late payment of credit card bills to £12 and is perhaps at last a sign that the financial regulators have teeth.
Away from bank charges, another regulator has been getting busy with mortgage exit fees.
Whether it's repaying a mortgage early or simply switching provider, mortgage companies are allowed to charge a fee for the privilege of you closing your account with them and moving it elsewhere.
Concern has been raised that exit fees or early redemption fees have been raised out of all proportion as lenders try to claw back money they lose when customers switch to another company.
While the practice of making these fees higher than those agreed in the original contract has yet to be tested legally, research from L&C Mortgages shows that the average exit fee has more than doubled from £115 in 2003 to £239 today (Tuesday, 20 March). In many cases, as the exit fee is not normally fixed at the time the mortgage offer is made, many lenders have taken advantage of this to hit borrowers with big increases that they can do nothing about. The fact that switching also triggers arrangement and administrative fees means that taking out a new deal now costs many borrowers more than £500.
Now the FSA has said that some fees must be cut and indicated that borrowers who were unfairly charged should be compensated. Most of the big banks are implicated as are many of the building societies. Any lenders that plan to continue charging high fees will have to justify their actions. And this new rule also applies to past customers, so those who have already paid the charge should be entitled to a refund. If you think you might be one of those entitled, you should contact the FSA
Since then, the campaign to stamp out excess bank charges has mushroomed. At one stage in February over 5,000 people a day were calling the financial ombudsman for advice.
As yet there has been no formal advice from the authorities to banks to trim their charges but, as anger grows, two powerful new forces have entered the fray on consumers' behalf.
The Office of Fair Trading (OFT) is due to issue a report shortly in which they are expected to say that bank charges are far too high. It's unclear what ceiling they will attempt to set although when you consider that the actual cost of a bounced cheque or a customer going beyond their overdraft limit is somewhere between £2.50 and £4.50, and charges can be as high as £35, there is some room to manoeuvre. In a situation where city bank Credit Suisse estimates banks make over £1.2bn from charges, few customers will shed tears, particularly when you consider that profits at high street banks have surged to £40 billion - an increase of 40%.
Any changes to charges will not happen retrospectively of course, and if you're still unhappy with the way the bank is responding to your complaints, then a phone call to the Office of the Financial Ombudsman might be in order. They have proved extremely helpful to many consumers not just in claiming back unfair charges, but also interest accrued on those charges
As the number of consumers protesting against these charges has grown, so have the banks' defences. In order to claim back charges, customers need a list of them and banks are allowed to charge up to £10 for six years' worth. However, although the maximum amount payable to obtain this list is covered under the Data Protection Act 1998, statements are not. And according to thisismoney.co.uk, banks have taken to offering customers their old statements instead of the charge list and charging £5 for each one. This can lead to a bill running into hundreds of pounds.
Other ways banks have started to fight back include threatening to close customers' accounts, or even switching accounts away from free banking to accounts which have standing charges even if you stay in credit. So before you embark on trying to reclaim your original charges, it might be worth opening an account elsewhere just in case the worst should happen.
And do check your bank statements for any evidence of new fees.
The OFT report comes hard on the heels of their success in limiting fees for late payment of credit card bills to £12 and is perhaps at last a sign that the financial regulators have teeth.
Away from bank charges, another regulator has been getting busy with mortgage exit fees.
Whether it's repaying a mortgage early or simply switching provider, mortgage companies are allowed to charge a fee for the privilege of you closing your account with them and moving it elsewhere.
Concern has been raised that exit fees or early redemption fees have been raised out of all proportion as lenders try to claw back money they lose when customers switch to another company.
While the practice of making these fees higher than those agreed in the original contract has yet to be tested legally, research from L&C Mortgages shows that the average exit fee has more than doubled from £115 in 2003 to £239 today (Tuesday, 20 March). In many cases, as the exit fee is not normally fixed at the time the mortgage offer is made, many lenders have taken advantage of this to hit borrowers with big increases that they can do nothing about. The fact that switching also triggers arrangement and administrative fees means that taking out a new deal now costs many borrowers more than £500.
Now the FSA has said that some fees must be cut and indicated that borrowers who were unfairly charged should be compensated. Most of the big banks are implicated as are many of the building societies. Any lenders that plan to continue charging high fees will have to justify their actions. And this new rule also applies to past customers, so those who have already paid the charge should be entitled to a refund. If you think you might be one of those entitled, you should contact the FSA
Victory for bank charge mum
A MUM has won a victory over one of Britain's biggest banks after she was hit with massive charges.Helen Franks, 46, decided to get tough with the Royal Bank of Scotland when they penalised her for exceeding her overdraft limit by just over £27.
Over the following weeks she was charged a total of £321. By going through her bank statements for six years, Helen, of Prestwich, found she had been charged more than £900 interest.
She embarked on a four-month battle against the bank - which announced annual profits of £9.2bn earlier this month - and eventually took it to court to recover her funds.
Helen followed advice from Manchester finance expert Martin Lewis, who has led a crusade against bank charges, and challenged the bank claiming the charges were unlawful because they could not be justified by the costs incurred by the bank.
Bailiffs
Despite winning her case at Manchester County Court, the bank ignored the ruling. Ultimately she had to threaten it with a visit from the bailiffs before the bank caved in and repaid Helen the full amount of her claim.
Mum of three Helen, who works for a dental recruitment firm and has had an account with the Royal Bank of Scotland for 23 years, is now urging all bank customers to follow her example.
Her struggle began last October when she notified the bank she was going to exceed her overdraft limit by less than £30, but she was hit with charges anyway.
She said: "I went to my branch in Manchester on a number of occasions to explain how difficult the problem was for a single mother of three. I was met with no sympathy whatsoever. At times the bank's attitude appeared vindictive."
As the bank imposed a £38 charge for each transaction that went over her overdraft limit, she was driven further into the red and several payments - including her council tax - were refused.
Claim
Helen calculated that she was charged a total of £321 over three months as she struggled to get her account back on course. She also demanded the bank supply her with statements from the past six years and worked out she had been charged £925 in interest. Helen paid £120 to submit a claim to the county court.
"The court wrote several letters to the bank and they were ignored so I won the case because it was uncontested," she said.
The bank eventually sent her a cheque for the full amount of the claim, plus costs.
Helen said: "I have been appalled by the whole experience."
A spokesman for the Royal Bank of Scotland said: "The fees against Ms Franks's account were taken when she failed to ensure that sufficient funds were available to cover her transactions. All fees were refunded as a gesture of goodwill."
HAVE you succeeded in winning back excessive bank charges? Let us know!
Clock is ticking for bank charge claims
Time is ticking for people who want to reclaim bank charges, as the OFT is due to make an announcement about what it considers is a fair charge for dealing with current account defaults.A spokesperson for the OFT told This is Money they still didn't know exactly when an announcement would be made, but it is likely to be made within the next month. The OFT's decision is likely to affect the amount that individuals and businesses can reclaim.
The OFT's announcement will detail the amount that it considers banks can reasonably charge customers to deal with unauthorised overdrafts, cancelled cheques, returned direct debits, and various other defaults.
The charges, which are currently as high as £39, have been deemed to be unlawful because banks are not allowed to profit from dealing with penalty charges. While banks say they stand by their charges, none of them have yet defended them in court for fear of having to justify them.
Instead, they are routinely refunding them in full, but that is very likely to change once the OFT states its opinion on what is a 'fair charge'. It is likely that customers will only be refunded their bank charges, minus the cost of what the OFT says is fair.
For instance, if the OFT says it is fair to charge £10 for going into unauthorised overdraft, and the customer has been charged £25, they might only get the difference of £15 returned to them.
So if customers want to have all their charges refunded, they need to make a claim now to ensure they receive the maximum possible refund.
The OFT announcement is likely to be the catalyst for other changes in the industry as well. This is Money believes it's very unlikely that the banks will simply accept the limits imposed by the OFT without seeking to claw back the losses. So it could also be the time when we see higher rates of interest on credit cards and overdrafts, and possibly the more widespread introduction of monthly fees on current accounts.
Some analysts believe this would be a fairer system, but the prospect has angered people who are sensible and responsible with running their current account and who never run up charges.
Friday, 16 March 2007
'Homeowners could avoid bank charges'
Homeowners could escape having to pay for their banking if the industry introduces charges for previously free services, according to a financial product research company.Defaqto says that offset and current account mortgages could help mortgagees avoid paying banking fees.This is because the products combine a homeowner loan with a bank account and possibly other financial service as well.In its report, Defaqto reveals that providers who do not impose charges will potentially be able to save customers around £120 per year. An assessment of the market reveals 36 providers involved in the offset and current account mortgage market offering a total of 198 products among them. Three providers (Clydesdale, NatWest and Yorkshire Bank). were found to be offering both offset and current account mortgages.David Black of Defaqto said of offset and current account mortgages: "They are now increasingly regarded as mainstream products and we believe that providers will start to target new markets such as buy-to-let investors or those with lumpy income streams.”The head of the British Bankers' Association, Angela Knight, caused controversy recently when she appeared on Radio 4's today programme.She said that the introduction of charges for previously free banking services was "an inevitable consequence" of regulatory action against penalty charges.Thursday, 15 March 2007
Do the banks have a guilty secret?
Transparency may be the fashionable buzzword of the age, but not if you are a bank dealing with thousands of demands to refund overdraft charges.
The Nationwide has been receiving 5,000 claims a week
In the past few weeks, hundreds of thousands of people have been downloading letters from websites such as those of the BBC, Which? and campaign groups, aimed at reclaiming excessive bank overdraft fees.
It has been said that up to two million of these letters have been printed off.
A lot of money is at stake.
Analysts at the bank Credit Suisse recently estimated that the UK's high street banks earn about £1.2bn a year between them by levying penalty charges on customers who go overdrawn without permission.
The Nationwide has been receiving 5,000 claims a week
In the past few weeks, hundreds of thousands of people have been downloading letters from websites such as those of the BBC, Which? and campaign groups, aimed at reclaiming excessive bank overdraft fees.
It has been said that up to two million of these letters have been printed off.
A lot of money is at stake.
Analysts at the bank Credit Suisse recently estimated that the UK's high street banks earn about £1.2bn a year between them by levying penalty charges on customers who go overdrawn without permission.
Commercial confidentiality
How many of these letters have actually been sent to the banks? And how much money have they paid out? We are not providing that data Barclays bank
The banks will not say yet. "We wouldn't like to divulge those sorts of numbers," said a spokeswoman for Barclays, citing "commercial confidentiality".
At Lloyds TSB, the response was very similar. "We wouldn't disclose that number," the spokeswoman said. Guess what the helpful man at the HSBC press office said?
"We are not providing that data. It is a competition issue and is confidential."
However, a hint came last month when Stuart Bernau, an executive director of the Nationwide, said his building society was being sent 5,000 complaints each week about overdraft fees.
"It is now considerably more at the banks," said a well-informed industry observer.
"It is also operationally a major headache," he added.
Refunds
There is no doubt that money has already been refunded.
Nearly £8.4m has been recovered so far by CAG members
Since this consumer revolt started about a year ago, the website of the Consumer Action Group (CAG) has been logging the repayments of members who tell it of their successful claims.
So far, nearly 6,000 people who have used the CAG web site have received almost £8.4m as a result of challenging their banks' overdraft penalties.
"We are getting a real upsurge in the use of the site," says Marc Gander of the CAG.
With newspapers and the likes of Which? whipping up a big campaign recently to encourage even more claimants, the figures are likely to become even larger, especially as the banks appear to have a policy of always caving in once the case goes to court.
"Loads of ambulance chasers are now springing up. The word is spreading like wildfire," said Mr Gander.
Enquiries
So how many claims are now in the pipeline?
It is not necessary for us to know the numbers of complaints
OFT spokesman
"We would love to know that, but nobody will tell us," said Helen Ainsworth of Which?
Rather surprisingly, the Office of Fair Trading has not asked, even though it is in the middle of an inquiry into the banks' overdraft fees.
Its report will be published in a month or two and may call for these fees to be slashed, just as it did last year with credit card default fees.
"They didn't ask the question," said an OFT spokesman of the inquiry team.
"It is not necessary for us to know the numbers of complaints.
"The OFT has identified a potential problem and that it is serious enough for us to look into - that is what we are doing at this stage," he said.
The Financial Services Authority has also just started a review of the general procedures banks have in place for dealing with complaints, to make sure they are fair, prompt and consistent.
But again, it appears that a straightforward question about how many complaints have been received concerning bank charges may not form part of such an inquiry.
Eventual disclosure
Even so, the true scale of these customer refunds will probably emerge in the next few months.
The number will probably shoot up if the OFT says the current fees for unauthorised overdrafts are too high, thus encouraging many more people to claim.
If that happens, the scale of the refunds could force the banks to disclose the sums involved to investors in their annual profits announcements.
"Much more than £10m for each institution is the order of magnitude at which they would think of disclosing," said one City banking analyst.
"I think this will turn into a bigger issue than it has become so far," he added.
Caught in the penalty area
A teenager has been sucked into a debt trap after falling foul of excessive bank charges and misleading information.Clare Allen was 18 when she started getting into difficulty on her HSBC current account. Now 19 and with take-home pay of just £711 a month, she is facing a £6,000 debt.
Her mistake was to believe that a £50 overdraft limit on her account meant she couldn't go beyond this amount. That mistake led to her running up almost £800 in charges which plunged her into a sea of debt.
On her low wage, she often withdrew small amounts of just £10 or £20 to pay for lunches at work. Once overdrawn, each individual withdrawal incurred charges.
Last week, HSBC announced profits of £11.5bn for 2006 while former boss Sir John Bond walked away with a package worth £8.5m, around a thousand times Miss Allen's annual take-home pay.
Miss Allen, who works as a receptionist at a Southampton-based law firm, accidentally went overdrawn in April last year. She thought if she went more than £50 into the red her card would be declined - she was deceived by the words 'overdraft limit'. But this never happened and payments continued to go through.
Miss Allen assumed she had got her sums wrong and there was money in her account or that her salary had been paid in early. Before she knew it, she was more than £350 in debt.
She went to her HSBC branch because she wanted to tackle the problem and came out with a £2,000 loan. Miss Allen says she asked her bank to remove the overdraft altogether so she could not get into further trouble. Despite this, she went overdrawn again and was hit with more charges.
Miss Allen paid a £25 penalty every time she went over her formal overdraft. She was also charged £25 for bounced direct debits and payments of more than £25 in value. (Items under £25 attract a £10 fee.)
In June 2006, she ended up with another £2,000 loan. But the loans would just pay off the overdraft with a little left over - before the debts started racking up again. She then consolidated all the loans into one £6,000 loan in October which will cost her £142 a month over five years.
Miss Allen says: 'I'm a teenager with little money coming in and I hate this debt hanging over my head. I did ask HSBC to get rid of the overdraft facility but it said I couldn't do this. Next thing I know I had consolidated my debts into a loan.'
Bank staff get incentives for selling financial products to customers - Payment Protection Insurance which is often sold with personal loans gains the most commission and has been heavily criticised by City watchdogs.
But HSBC denies any wrongdoing in its handling of Miss Allen. A spokesman says: 'We credit scored her and checked her affordability for the loans at every step. We even declined her for a fourth loan which proves that checks were made.
'The customer has to take some responsibility for their spending.'
But the bank has agreed to repay £799 of bank charges, which it says will be used to pay back some of her loan.
Wednesday, 14 March 2007
Watch Whistle Blower on BBC1 21st March 9pm
Whistleblower, the BBC's flagship undercover series – fresh from exposing corruption in the world of estate agents and bailiffs – moves on to another controversial target: banks.
During a nine-month investigation, BBC reporters worked undercover in a leading British bank – and what they found will shock their customers.
Working in a huge call centre and then High Street branches, they witnessed customers being misled, lied to and treated with contempt. With bank fraud at unprecedented levels, they expose gaping holes in bank security, along with evidence of widespread fraud and corrupt bank insiders.
As banks announce record profits, Whistleblower exposes senior staff members knowingly enforcing unlawful bank charges on customers. The undercover team also discovers a secret directive to staff to refund charges to wealthy customers who complain, while poorer customers are shown no such mercy. One trainer – teaching new staff how to do their job – confesses to being a "right git" when desperate customers come on the phone complaining about bank charges.
"They will start shouting, being abusive, crying, start blaming you, (saying) my kids are going to starve," he says. 'But my attitude is, I don't know you, I don't care."
This investigation blows the lid on an industry which claims to put the interests of its customers and their money at its heart.
During a nine-month investigation, BBC reporters worked undercover in a leading British bank – and what they found will shock their customers.
Working in a huge call centre and then High Street branches, they witnessed customers being misled, lied to and treated with contempt. With bank fraud at unprecedented levels, they expose gaping holes in bank security, along with evidence of widespread fraud and corrupt bank insiders.
As banks announce record profits, Whistleblower exposes senior staff members knowingly enforcing unlawful bank charges on customers. The undercover team also discovers a secret directive to staff to refund charges to wealthy customers who complain, while poorer customers are shown no such mercy. One trainer – teaching new staff how to do their job – confesses to being a "right git" when desperate customers come on the phone complaining about bank charges.
"They will start shouting, being abusive, crying, start blaming you, (saying) my kids are going to starve," he says. 'But my attitude is, I don't know you, I don't care."
This investigation blows the lid on an industry which claims to put the interests of its customers and their money at its heart.
THE GREAT BANKS REVOLT
Banks are facing open revolt, with the vast majority of customers ready to switch accounts if traditional free banking is ended.Eight in 10 Britons say they are not prepared to pay a fee just for running a normal current account without an overdraft.But it is feared that the big banks are planning such a move because they are being forced to slash – and in many cases repay – other charges.One expert predicted customers could be in line to reclaim more than £2billion they have been made to pay in unfair penalty charges, such as for going overdrawn. Others said the total could be three times that figure.The Office of Fair Trading is expected to cap penalty fees in a ruling later this month.Its move comes as the reputation of high street banks has plummeted because of the way the public has been overcharged for years.However, the cap will lead banks to look elsewhere to boost profits.Campaigners last night warned that abolishing free banking would spark one of the largest backlashes in banking history. Last week it emerged that Britain’s banks made a combined profit of about £40billion last year – a rise of 10 per cent.It is yet another example of the British public fighting back against rip-off fees and willing to throw decades of loyalty out of the window to get a fair deal.Under UK law, banks can only impose fees that reflect their administrative costs in dealing with misdemeanours such as going overdrawn or a bounced cheque. It is estimated to cost only £4.50 to deal with any default charge on a current account but most customers face anything up to £40 a time just for going £1 overdrawn.The OFT last year said such charges are unfair and is to publish its conclusions of an investigation later this month.It is expected to recommend a cap on charges of between £12 and £15, similar to limits the watchdog has already applied to charges on credit cards. Fees are routinely charged on everyday transactions on current accounts around the world, including Europe and the US.But Nick White, director of financial services for uSwitch.com, said: “We are in little doubt that the introduction of banking fees will be one of the biggest triggers for current account switching that we’ve ever seen. “The UK is one of the only places in the world that doesn’t charge for current accounts.” A spokeswoman for Which? said: “If some of the banks do introduce fees we recommend people shop around and change accounts.”uSwitch.com warned that if banks are forced to cut the amount they charge customers for defaults it will serve “as a catalyst for the fast introduction of monthly fees” on accounts in general. It said that would end more than two decades of not charging, effectively just for the management of an account, even if customers stay in credit.A survey by YouGov, for the price comparison website, revealed that a massive 83 per cent of customers would close their account if such fees were introduced. That number includes customers who have been loyal to their bank up to two decades.Mr White added: “The next 12 months, will be decisive in determining the future of ‘free banking’ as the banks are forced to take action.”Martin Lewis, from Moneysavingexpert.com, said there is no such thing as “free banking” considering the various charges customers already face, and predicted no banks would consider it in any event.However a spokesman for the British Bankers’ Association said: “Some banks, like Barclays, have said they are committed to free banking but we do not know what actions other banks are going to take.”
It’s the end of the road for carefree consumption
Do you think of yourself as a consumer? The Scottish Consumer Council (SCC) has just published a booklet telling us why we should. It's not our "business to tell people what to call themselves", say the SCC. Good advice instantly forgotten to give gems such as: "Victims of violent crime may not think of themselves as consumers of police services."
When any organisation has to justify its name something must be wrong. But the SCC's booklet illustrates an important principle - does it matter what we call ourselves? Does thinking of ourselves as consumers, individuals, communities or citizens have an impact on the world we live in?
Personal debt is at an all-time high in the UK. At the end of last year, our personal debt stood at £1.29 trillion, overtaking the US on a pro-rata basis. Most working families are just a couple of wage slips away from financial disaster, having no savings to speak of. Meanwhile, financial institutions offer guilt-free credit while marketing companies fuel a buy-now, pay-later culture. No-one can dispute that consumerism has led to hundreds of thousands of consumers being made bankrupt in the UK over the past decade. There were 107,288 personal insolvencies in England and Wales last year compared with 24,549 in 1998. For the same period in Scotland we had 13,638 personal insolvencies as against 4465.
In stark contrast, UK banks have just declared their best ever profits. The Royal Bank of Scotland had pre-tax profits of £9.2bn, up 16% on the previous year and the highest profit ever made by a Scottish company. How is this possible when bad debts are at an all-time high?
It is no coincidence that as bad debts have increased exponentially over the past decade so have bank charges. The average bank charge for customers in 1998 was £12; by 2006 it had jumped to more than £67 (£39 per item, £28 monthly fee and 30% unauthorised overdraft interest). That's a 558% increase in eight years.
I believe consumerism has become outdated and morally bankrupt.
Banks have been recouping their bad debts from other consumers. In my experience, the one in five customers who pay bank charges are generally low-paid, poor and coping with a relationship breakdown, illness or personal calamity. Calling people consumers in this context is meaningless because "consumers" are not treated like for like.
Consumerism is about choice. Even people on a decent wage have no choice. In Glasgow, you have the right to request that your child goes to Jordanhill School, but for that to happen you need to live nearby. The average house price in Jordanhill is around £200,000. That represents an impossible mortgage of £1300 per month for most working families.
Consumerism promises an egalitarian society which it cannot deliver. More disturbing is the realisation that we have reached a point where consumer principles have endangered more than just debtors. The idea that you as an individual have the right to consume whatever you like - whether you can pay for it or not - is all pervading. The right to own a fleet of Chelsea tractors to drive around urban Scotland, guzzling as much petrol as you like, polluting the air as much as you like. It's your right to consume.
But this thinking is no longer sustainable. Carefree consumption has resulted in an overproduction of CO2, and global warming with its promise of worldwide catastrophe. In response to this threat many people now recycle their rubbish and think about how they can off-set or reduce their carbon footprint.
Concern for the environment is now a top political issue which resonates across all sections of society. We have barely scratched the surface of the work that is needed to tackle climate change, but the starting point on any road to recovery is self-awareness and admission.
If we regard ourselves as consumers we are absolved of any responsibility for our neighbour, community and the wider world. A consumer philosophy justifies financial institutions lending irresponsibly, because they are only meeting market demand. This view of human and corporate relationships is incapable of sustaining the modern world. I believe consumerism has become outdated and morally bankrupt in the 21st century.
In its place we should think of ourselves as citizens.
Chancellor Gordon Brown talks about 21st-century citizenship combining individual aspirations and freedom with a supportive and empowered community. We may disagree on what citizenship means, but if we think of ourselves as citizens we can acknowledge that personal freedom comes with a responsibility to ourselves, our community and the environment.
A leading campaigner on the climate is former Vice-President Al Gore. He draws hope from the Chinese expression for "crisis", which consists of two symbols: danger and opportunity. We have an opportunity to think like citizens.
When any organisation has to justify its name something must be wrong. But the SCC's booklet illustrates an important principle - does it matter what we call ourselves? Does thinking of ourselves as consumers, individuals, communities or citizens have an impact on the world we live in?
Personal debt is at an all-time high in the UK. At the end of last year, our personal debt stood at £1.29 trillion, overtaking the US on a pro-rata basis. Most working families are just a couple of wage slips away from financial disaster, having no savings to speak of. Meanwhile, financial institutions offer guilt-free credit while marketing companies fuel a buy-now, pay-later culture. No-one can dispute that consumerism has led to hundreds of thousands of consumers being made bankrupt in the UK over the past decade. There were 107,288 personal insolvencies in England and Wales last year compared with 24,549 in 1998. For the same period in Scotland we had 13,638 personal insolvencies as against 4465.
In stark contrast, UK banks have just declared their best ever profits. The Royal Bank of Scotland had pre-tax profits of £9.2bn, up 16% on the previous year and the highest profit ever made by a Scottish company. How is this possible when bad debts are at an all-time high?
It is no coincidence that as bad debts have increased exponentially over the past decade so have bank charges. The average bank charge for customers in 1998 was £12; by 2006 it had jumped to more than £67 (£39 per item, £28 monthly fee and 30% unauthorised overdraft interest). That's a 558% increase in eight years.
I believe consumerism has become outdated and morally bankrupt.
Banks have been recouping their bad debts from other consumers. In my experience, the one in five customers who pay bank charges are generally low-paid, poor and coping with a relationship breakdown, illness or personal calamity. Calling people consumers in this context is meaningless because "consumers" are not treated like for like.
Consumerism is about choice. Even people on a decent wage have no choice. In Glasgow, you have the right to request that your child goes to Jordanhill School, but for that to happen you need to live nearby. The average house price in Jordanhill is around £200,000. That represents an impossible mortgage of £1300 per month for most working families.
Consumerism promises an egalitarian society which it cannot deliver. More disturbing is the realisation that we have reached a point where consumer principles have endangered more than just debtors. The idea that you as an individual have the right to consume whatever you like - whether you can pay for it or not - is all pervading. The right to own a fleet of Chelsea tractors to drive around urban Scotland, guzzling as much petrol as you like, polluting the air as much as you like. It's your right to consume.
But this thinking is no longer sustainable. Carefree consumption has resulted in an overproduction of CO2, and global warming with its promise of worldwide catastrophe. In response to this threat many people now recycle their rubbish and think about how they can off-set or reduce their carbon footprint.
Concern for the environment is now a top political issue which resonates across all sections of society. We have barely scratched the surface of the work that is needed to tackle climate change, but the starting point on any road to recovery is self-awareness and admission.
If we regard ourselves as consumers we are absolved of any responsibility for our neighbour, community and the wider world. A consumer philosophy justifies financial institutions lending irresponsibly, because they are only meeting market demand. This view of human and corporate relationships is incapable of sustaining the modern world. I believe consumerism has become outdated and morally bankrupt in the 21st century.
In its place we should think of ourselves as citizens.
Chancellor Gordon Brown talks about 21st-century citizenship combining individual aspirations and freedom with a supportive and empowered community. We may disagree on what citizenship means, but if we think of ourselves as citizens we can acknowledge that personal freedom comes with a responsibility to ourselves, our community and the environment.
A leading campaigner on the climate is former Vice-President Al Gore. He draws hope from the Chinese expression for "crisis", which consists of two symbols: danger and opportunity. We have an opportunity to think like citizens.
Tuesday, 13 March 2007
Nationwide caves in over cutting off customers
Nationwide has stopped closing down the current accounts of customers who have successfully reclaimed bank charges, the Guardian reports.Although Nationwide responded to claims for compensation from customers disgruntled by the bank charges imposed when they exceeded their overdraft limits alongside the UK's other big banks in the UK, it was subsequently penalising many such customers by closing down their accounts, the paper found.According to the Guardian, the bank has also redrafted its explanation letters to customers who have claimed compensation for charges.Its previous practice was to send out a first letter promising a full refund followed by a second letter announcing closure of their account.The Financial Ombudsman Service recently found in favour of a customer whose account was closed down after he won a refund from his bank – the watchdog castigated the bank for using closure "as a retaliatory or punitive measure".It is currently looking at 50 more such cases.The battle with the banks heated up over the weekend as it emerged that two million bank customers have now downloaded templates for complaint letters from campaign sites, including consumer body Which?
Who wants to be a billionaire?
QUESTION: Who wants to be a bank charge billionaire?Answer: Our friendly high street banks - at your expense!
Nearly 19 million people have been hit by bank charges totalling a massive £4 billion – and over half have still not claimed the money back.
Despite the furore over the unscrupulous banks gathering pace, customers have been slow to react. Only one in ten appear to know what they are entitled to claim and, despite widespread condemnation, greedy banks are still clinging to £2.12 billion of unfair charges.
But this money is not lost. “The majority of banks are bending over backwards to refund bank charges to consumers that fight back,” says Nick White of uSwitch. “This is because they’d rather settle now than have to appear in court for a damaging test case which would set a dangerous legal precedent.”
For just £10, customers can request copies of previous bank statements and write to their bank to reclaim charges incurred over the last SIX years – with 8% INTEREST.
Act now.Customers looking to claim are perfectly within their rights. Last April, the Office of Fair Trading (OFT) said charges being levied on customers were excessive. Since its announcement it's been inundated with 5,000 complaints a day.
Banks argue it is only the high charges for overdrawn customers that’s allowed them to stick with ‘free banking’. With millions now claiming their money back, monthly or ‘pay as you use’ charges for current accounts appear imminent.
If customers are forced to pay for the 'luxury' of a simple account, four in five said they would look to switch, despite most of them being with their banks for over 20 years.
The unfair charge debate looks set to spark a revolution. Stick with Sun Money to guide you through.
Nearly 19 million people have been hit by bank charges totalling a massive £4 billion – and over half have still not claimed the money back.
Despite the furore over the unscrupulous banks gathering pace, customers have been slow to react. Only one in ten appear to know what they are entitled to claim and, despite widespread condemnation, greedy banks are still clinging to £2.12 billion of unfair charges.
But this money is not lost. “The majority of banks are bending over backwards to refund bank charges to consumers that fight back,” says Nick White of uSwitch. “This is because they’d rather settle now than have to appear in court for a damaging test case which would set a dangerous legal precedent.”
For just £10, customers can request copies of previous bank statements and write to their bank to reclaim charges incurred over the last SIX years – with 8% INTEREST.
Act now.Customers looking to claim are perfectly within their rights. Last April, the Office of Fair Trading (OFT) said charges being levied on customers were excessive. Since its announcement it's been inundated with 5,000 complaints a day.
Banks argue it is only the high charges for overdrawn customers that’s allowed them to stick with ‘free banking’. With millions now claiming their money back, monthly or ‘pay as you use’ charges for current accounts appear imminent.
If customers are forced to pay for the 'luxury' of a simple account, four in five said they would look to switch, despite most of them being with their banks for over 20 years.
The unfair charge debate looks set to spark a revolution. Stick with Sun Money to guide you through.
Bank charges could cause switching upheaval
Up to 83 per cent of consumers would change banks in the event of free accounts ending, according to new research.A YouGov survey on behalf of uSwitch questioned over 4,500 adults in the UK and found that the introduction of fees would lead to a significant shake up of consumer banking habits, with many having already been penalised by previous bank charges.Almost 19 million people have been affected by such levies, according to the YouGov poll, with just over nine million successfully claiming these fees back.However, around three million customers were unsuccessful in their attempts at reimbursement, while just 14 per cent of all consumers knew precisely what they could claim back."The UK is one of the only place in the world that doesn't charge for current accounts," advised uSwitch director of financial services Nick White."Customers have enjoyed free banking on current accounts for the past 23 years but the current backlash against charges for items such as overdrafts and bounced cheques, as well as ongoing investigations into lucrative financial products such as Payment Protection Insurance (PPI) on loans and credit cards, will serve as catalyst for the fast introduction of monthly fees," he added.Hundreds of people are now turning to 'no win, no fee' law firms in order to reclaim charges, the BBC has reported.
Bank charges: Daylight robbery says uSwitch
Around 18.96 million people have been hit by bank charges, totalling £4 billion, and over half (52%) have still not managed to claim the money back, according to research from uSwitch.com.As a result, there is a pot worth £2.12 billion waiting to be reclaimed. For just £10, people can get copies of previous bank statements and write to their banks to reclaim charges incurred over the last six years (plus 8% interest), but only 14% of consumers are aware of exactly what they are entitled to claim.The research also revealed that while 65% of the 18.96 million people that have incurred some form of bank charges have disputed these fees at some point in time, only 48% (9.1 m) have successfully received a refund. Almost one in ten (1.5 million) have written to a regulatory body, such as the Financial Ombudsman, threatened their bank with legal action or taken them to court. Of the few that have taken legal action, 14% claim to have had their current account closed down by their bank as a result. The banks' arguments for the end of ‘free banking’ focuses on the fact that customers who go overdrawn are currently paying for those who don't go overdrawn and that banks face costs in running current accounts for all. It is widely believed that current account charges will be reduced in the very near future and that this will result in customers either having to pay a monthly fee for a current account or facing 'pay as you go' charges based on how much an account is used and what it is used for.The research found that 83% would leave their bank if they decided to introduce a monthly or annual fee for a standard current account. On average, consumers have been with their current bank for 16 years, while a third have stayed put for more than 20 years. The introduction of banking fees will clearly be a catalyst for one of the biggest ever shake-ups in the current account switching market.Some banks have already introduced charges to combat costs incurred on their current accounts. Lloyds TSB recently increased the monthly fee on their Premier Banking account by 70%, from £15 to £25, unless customers keep a monthly balance in excess of £5,000, while Halifax has recently launched an account charging £10 a month. And since 1st February customers who only hold a current account with First Direct have been asked to pay at least £1,500 each month into the account (internal transfers excluded) or maintain an average monthly balance on the account of over £1,500. Customers who do not do so may otherwise be charged a banking fee of £10 a month for the privilege of having a basic bank account.Consumers polled in the uSwitch.com survey also said that a “fair” sum for a bank charge would be on average £4.07 (close to the £4.50 estimated to be the true cost to banks by the BBC’s Money Programme in December). If fees were cut to this level, the average total incurred by consumers who have fallen victim to bank charges would fall from £215 to just £34.07; the revenue banks have generated from fees would fall by 84% from £4 billion to £646 million. Alternatively, if they were capped at £12, as they are now on credit card default fees, the banks’ revenue would drop by 53% to £2.2 billion.Nick White, Director of Financial Services at independent price comparison and switching website uSwitch.com, comments: “While the majority of banks are bending over backwards to refund bank charges to those consumers that take the initiative to fight back, this is not because the banks have gone soft in the last couple of months. They would simply rather settle now than have to appear in court and face a damaging test case which would set a dangerous legal precedent. However, the fact remains that only a court can determine whether a charge is unfair or not, and a test case may be the only way to resolve this issue once and for all.”Key findingsExceeding an authorised overdraft limit is the most popular reason for being stung, affecting 71% of consumers. On average, consumers say that they have been charged between 3 and 4 times for this reason by their current bank, while one in ten say they have been hit more than 10 times Direct debit or standing order payments with insufficient funds in an account have affected more than half of consumers (58%), who have been charged between 2 and 3 times on average for this, while 7% have been charged more than 10 times Debit card payment without sufficient funds to cover the purchase, cheque-bouncing, and cash withdrawals without sufficient funds are also common reasons - affecting 27%, 24% and 16% of people respectively Two-thirds (66%) think there should be a ‘buffer’ zone for people who go less than £10 in the red Nearly a third (30%) think that first time offences should always be refunded immediately and a further 21% think that they should be refunded on request Four out of 10 think that each case should be looked at on its own merits using an appeal process Just over a quarter believe that current accounts should be frozen as soon as they go overdrawn to stop people spending money and incurring more charges White concludes: “Refunding bank charges is thought to be costing the banks at least £50m. The Financial Ombudsman Service has recently claimed that is was receiving 5,000 complaints a day about ‘unlawful’ bank charges with a spokesman saying that the number of complaints was unprecedented and has “even eclipsed mortgage endowment complaints”. When this is combined with the likely outcome of the OFT’s impending investigation, which is set to recommend a cap on fees, the banks’ profit margins are likely to be hit hard hard. “The UK is one of the only place in the world that doesn’t charge for current accounts. Customers have enjoyed free banking on current accounts for the past 23 years but the current backlash against charges for items such as overdrafts and bounced cheques, as well as ongoing investigations into lucrative financial products such as Payment Protection Insurance (PPI) on loans and credit cards, will serve as catalyst for the fast introduction of monthly fees. Barclays, which recently posted record profits of £7.14bn, said that the bank was “determined” to protect free banking, but rival Nationwide believes charging for current accounts is a “fairer proposition”. The next 12 months, will be decisive in determining the future of ‘free banking’ as the debate rages on and the banks are forced to take action. “We are in little doubt that the introduction of banking fees will be one of the biggest triggers for current account switching that we’ve ever seen.”
Monday, 12 March 2007
£2bn unfair charges still to be claimed
More than £2bn is yet to be claimed back by customers unfairly charged by banks.
Almost 19m customers have been penalised with unfair overdraft charges, bringing in £4bn for the banks, the price comparison site uSwitch.com. found.
But despite a ruling from the Office of Fair Trading, which covers charges imposed on accounts for the past six years, more than half those affected have not taken action. That means a pot worth £2.12bn is still waiting to be claimed.
Last year, the big banks raked in billions from charges on current accounts, including penalties for unauthorised overdrafts and bounced cheques.
Thousands of customers have since demanded their money back after the OFT declared such charges were unfair.
Although many have won back their money, some found the banks hit back by closing their accounts. Forty-three% of customers had faced on average eight charges at £26 each, a total of £215, according to the uSwitch survey.
Of these, 9.1m had received a refund. And of the small number who took their banks to court to reclaim the charges, 14% found their current accounts were closed in retaliation.
But the Financial Ombudsman Service has ruled against this practice as well.
It insists these customers are entitled to compensation for the inconvenience of having to open a new account.
Almost 19m customers have been penalised with unfair overdraft charges, bringing in £4bn for the banks, the price comparison site uSwitch.com. found.
But despite a ruling from the Office of Fair Trading, which covers charges imposed on accounts for the past six years, more than half those affected have not taken action. That means a pot worth £2.12bn is still waiting to be claimed.
Last year, the big banks raked in billions from charges on current accounts, including penalties for unauthorised overdrafts and bounced cheques.
Thousands of customers have since demanded their money back after the OFT declared such charges were unfair.
Although many have won back their money, some found the banks hit back by closing their accounts. Forty-three% of customers had faced on average eight charges at £26 each, a total of £215, according to the uSwitch survey.
Of these, 9.1m had received a refund. And of the small number who took their banks to court to reclaim the charges, 14% found their current accounts were closed in retaliation.
But the Financial Ombudsman Service has ruled against this practice as well.
It insists these customers are entitled to compensation for the inconvenience of having to open a new account.
Bank customers 'due £2bn refund'
The campaign against high bank charges has been given a boost by research that disclosed that there was more than £2 billion in charges that could be reclaimed.
Thousands of people have already forced their banks to hand back hundreds of pounds charged in overdraft fees. Research from Uswitch, the finance website, suggests that about 19 million people have been hit by bank charges totalling £4 billion, and more than half have still not claimed back money they are due.
About two million people have downloaded pro-forma letters from internet sites, helping them to claim back the charges. Nick White, head of financial services at -USwitch, said that the revolt against bank fees is believed to be costing the banks at least £50 million, although this could be much higher if more people were aware of how to apply to have the charges -refunded. "The majority of banks are bending over backwards to -refund bank charges to those consumers that fight back," he said.
High street banks are -refunding most contested charges because they do not wish to risk a damaging test case in court that could set a legal precedent.
Campaigners argue that the charges of up to £39 levied when customers go overdrawn are unlawful but the banks have not allowed a single case to come to court.
The penalties imposed for unauthorised overdrafts are supposed to cover administration costs. However, campaigners claim the real cost is less than £5.
A pending report by the -Office of Fair Trading is likely to agree that charges are -excessive. It is expected to name a fair level of fees -between £12 and £20.
However, some experts have warned that the introduction of a cap on bank fees could lead to all customers being charged for using their current accounts because the fees currently made large profits for the banks. City bank Credit Suisse says the banking sector could lose £500 million a year if regulators declared fees unlawful.
"The UK is one of the only places in the world that doesn't charge for current accounts. Customers have enjoyed free banking on current accounts for the past 23 years but the current backlash against charges for items such as overdrafts and bounced cheques, as well as ongoing investigations into lucrative financial products such as Payment Protection Insurance (PPI) on loans and credit cards, will serve as a catalyst for the fast introduction of monthly fees," said Mr White, at Uswitch.
The website survey suggested that more than 80 per cent of people would consider switching banks if they were charged for operating a current account.
This research was carried on behalf of Uswitch.com by YouGov among 4,540 British adults.
Thousands of people have already forced their banks to hand back hundreds of pounds charged in overdraft fees. Research from Uswitch, the finance website, suggests that about 19 million people have been hit by bank charges totalling £4 billion, and more than half have still not claimed back money they are due.
About two million people have downloaded pro-forma letters from internet sites, helping them to claim back the charges. Nick White, head of financial services at -USwitch, said that the revolt against bank fees is believed to be costing the banks at least £50 million, although this could be much higher if more people were aware of how to apply to have the charges -refunded. "The majority of banks are bending over backwards to -refund bank charges to those consumers that fight back," he said.
High street banks are -refunding most contested charges because they do not wish to risk a damaging test case in court that could set a legal precedent.
Campaigners argue that the charges of up to £39 levied when customers go overdrawn are unlawful but the banks have not allowed a single case to come to court.
The penalties imposed for unauthorised overdrafts are supposed to cover administration costs. However, campaigners claim the real cost is less than £5.
A pending report by the -Office of Fair Trading is likely to agree that charges are -excessive. It is expected to name a fair level of fees -between £12 and £20.
However, some experts have warned that the introduction of a cap on bank fees could lead to all customers being charged for using their current accounts because the fees currently made large profits for the banks. City bank Credit Suisse says the banking sector could lose £500 million a year if regulators declared fees unlawful.
"The UK is one of the only places in the world that doesn't charge for current accounts. Customers have enjoyed free banking on current accounts for the past 23 years but the current backlash against charges for items such as overdrafts and bounced cheques, as well as ongoing investigations into lucrative financial products such as Payment Protection Insurance (PPI) on loans and credit cards, will serve as a catalyst for the fast introduction of monthly fees," said Mr White, at Uswitch.
The website survey suggested that more than 80 per cent of people would consider switching banks if they were charged for operating a current account.
This research was carried on behalf of Uswitch.com by YouGov among 4,540 British adults.
Bank charges 'daylight robbery'
Some 18.96 million British consumers have been charged bank fees totalling £4 billion, according to a new survey from price comparison site uSwitch.Over half of those who have been charged, 52 per cent, have not claimed their money back, which means that there is over £2 billion waiting to be claimed.And as banks reportedly mull over instituting an annual fee for standard current accounts, the survey found that 83 per cent of customers would leave their bank if it took such a course of action.Nick White, director of financial services at uSwitch, comments: "While the majority of banks are bending over backwards to refund bank charges to those consumers that take the initiative to fight back, this is not because the banks have gone soft in the last couple of months."Banks would rather settle right away rather than go through a court case which could result in setting a legal precedent, Mr White added.Exceeding one's overdraft limit is the most common cause of charges, the uSwitch survey found, affecting 71 per cent of customers.Last year the big five high street banks in the UK made an overall profit of over £40 billion.
Friday, 9 March 2007
New figures out today show that more and more people are using Which? to help claw back unfair bank charges.
People fighting for refunds of bank charges have been urged not to accept the most common response from the banks an offer of only half the money. Campaigners say banks and building societies are offering partial settlement to try to limit their losses.
Experts estimate the banks may have been levying £1.2bn of penalty charges a year and hundreds of thousands of customers are thought to be demanding refunds.
Martin Lewis, of moneysavingexpert.com, said offering half the claim was a more common tactic to forestall a full refund, rather than making illegal charges for information, delaying or suddenly closing accounts.
He warned customers could lose thousands of pounds by accepting such offers and urged court action if necessary. No bank has yet challenged in court customers' cases. Under the 1999 Unfair Terms in Consumer Contracts Regulations, the charges should not exceed the bank's costs.
Mr Lewis, whose site has now received 1.6 million requests for template letters, said: "What the banks are doing is coming out with opening salvos of half the money and many people simply accept. Claiming is a hassle and people are out of their comfort zones and the banks know this and know people are scared."
He suggested people seek no less than seven eighths of their charges. For instance someone claiming £4,000 might be offered £1,800 but they should seek and probably get £3,750.
Customers are also urged to demand refunds now before the Office of Fair Trading publishes its opinion on what constitutes a fair bank charge in the next few weeks. Banks may then fight court cases brought by customers demanding full refunds. That may stem some of the future liabilities of banks and building societies, who have already paid out an estimated £50m.
However, there was some bad news for the banks this week when the Treasury Select Committee announced that it was to investigate the sector aday after the leading nine banks reported record annual profits of £40bn a rise of 33 per cent.
The cross-party committee, chaired by Labour MP John McFall, pointed out that its inquiry would take place seven years after the publication of Don Cruickshank's review of bank competition.
The committee is likely to interview banks, consumer groups and campaigners.
Banks' dubious tactics
Illegal Overdraft Charges:
Banks are not allowed to profit from charges. Unauthorised overdraft fees should cost £4.50, but banks charge up to £39
Data Charges:
Banks are not allowed to charge more than £10 for supplying information about charges. But some banks charge their customers an hourly rate
Inadequate Settlement:
Instead of providing information about charges, banks have made low settlement offers
Delays:
Banks have been accused of delaying beyond the 40-day limit for information
Closing Accounts:
Customers have had their accounts closed
Experts estimate the banks may have been levying £1.2bn of penalty charges a year and hundreds of thousands of customers are thought to be demanding refunds.
Martin Lewis, of moneysavingexpert.com, said offering half the claim was a more common tactic to forestall a full refund, rather than making illegal charges for information, delaying or suddenly closing accounts.
He warned customers could lose thousands of pounds by accepting such offers and urged court action if necessary. No bank has yet challenged in court customers' cases. Under the 1999 Unfair Terms in Consumer Contracts Regulations, the charges should not exceed the bank's costs.
Mr Lewis, whose site has now received 1.6 million requests for template letters, said: "What the banks are doing is coming out with opening salvos of half the money and many people simply accept. Claiming is a hassle and people are out of their comfort zones and the banks know this and know people are scared."
He suggested people seek no less than seven eighths of their charges. For instance someone claiming £4,000 might be offered £1,800 but they should seek and probably get £3,750.
Customers are also urged to demand refunds now before the Office of Fair Trading publishes its opinion on what constitutes a fair bank charge in the next few weeks. Banks may then fight court cases brought by customers demanding full refunds. That may stem some of the future liabilities of banks and building societies, who have already paid out an estimated £50m.
However, there was some bad news for the banks this week when the Treasury Select Committee announced that it was to investigate the sector aday after the leading nine banks reported record annual profits of £40bn a rise of 33 per cent.
The cross-party committee, chaired by Labour MP John McFall, pointed out that its inquiry would take place seven years after the publication of Don Cruickshank's review of bank competition.
The committee is likely to interview banks, consumer groups and campaigners.
Banks' dubious tactics
Illegal Overdraft Charges:
Banks are not allowed to profit from charges. Unauthorised overdraft fees should cost £4.50, but banks charge up to £39
Data Charges:
Banks are not allowed to charge more than £10 for supplying information about charges. But some banks charge their customers an hourly rate
Inadequate Settlement:
Instead of providing information about charges, banks have made low settlement offers
Delays:
Banks have been accused of delaying beyond the 40-day limit for information
Closing Accounts:
Customers have had their accounts closed
Which? helps thousands take on banks
New figures out today show that more and more people are using Which? to help claw back unfair bank charges.
A total of 262,400 template letters and factsheets on reclaiming bank charges have now been downloaded from our bank charges site.
The penalty fees are charged by banks if you bust your overdraft limit, or if they bounce a cheque, for example.
‘Simple process’
Which? personal finance campaigner Emma Bandey said: ‘This figure is testament that the bank charges campaign has struck a real chord with the public and we are delighted to see so many people taking on their bank.
‘We hear, almost on a daily basis, from people who have successfully claimed back hundreds, or even thousands, of pounds from the banks.
‘Claiming back bank charges is a simple and straightforward process. Don't be put off from reclaiming your charges, get back the money you're owed.’
Mortgage exit fees
People who feel they have been unfairly charged for paying off their mortgage or for switching providers can now also access easy-to-use resources in our money section including a step-by-step guide to reclaiming and downloadable template letters to send to lenders.
A total of 262,400 template letters and factsheets on reclaiming bank charges have now been downloaded from our bank charges site.
The penalty fees are charged by banks if you bust your overdraft limit, or if they bounce a cheque, for example.
‘Simple process’
Which? personal finance campaigner Emma Bandey said: ‘This figure is testament that the bank charges campaign has struck a real chord with the public and we are delighted to see so many people taking on their bank.
‘We hear, almost on a daily basis, from people who have successfully claimed back hundreds, or even thousands, of pounds from the banks.
‘Claiming back bank charges is a simple and straightforward process. Don't be put off from reclaiming your charges, get back the money you're owed.’
Mortgage exit fees
People who feel they have been unfairly charged for paying off their mortgage or for switching providers can now also access easy-to-use resources in our money section including a step-by-step guide to reclaiming and downloadable template letters to send to lenders.
Which? sees growing numbers stand up to bank charges
Consumers are determined to retrieve the funds extracted from them by banks, Which? has revealed, as over a quarter of a million people download template letters to help them reclaim bank charges.The total number of downloads of template complaint letters and factsheets explaining how to recoup bank charges is now over 262,400, Which? reported.Bank customers' decision to take action to reclaim fees is "testament that the bank charges campaign has struck a real chord with the public", personal finance campaigner Emma Bandey said.It also suggests that publicity surrounding the ongoing Office of Fair Trading preliminary inquiry into charges on unauthorised overdrafts has alerted many customers to their rights.Customers should move now to "get back the money you're owed", Ms Bandey urged, emphasising that reclaiming bank charges is "simple and straightforward". The pressure on banks to rethink charging mechanisms is increasing, with the announcement this week that MPs on the Treasury Select Committee will conduct an inquiry including public hearings in which banks will be called on to account for their charges.
Thursday, 8 March 2007
Bank charges of £8,000 wanted back by licensee
A Devon licensee is attempting to reclaim almost £8,000 in penalty bank charges.
Tracy Bond of the Duke of York in Crediton, Devon is one of around 2m people nationwide who have joined the revolt against fees imposed for unauthorised overdrafts. The fees are meant to cover administration costs, estimated at about £4.50 rather than the £35 some banks charge.
The law currently allows claims to be made for the previous six years.
"I have given my bank, NatWest, two weeks to respond to my claim for £7,930 in penalty charges over five years," she said.
Bond claims that at times during the early years at the freehouse she was having to swallow £500 a week in penalty charges.
"The bank didn't seem to care if I was over my limit - they just carried on charging me fees," she said.
Ali Wittwer of the Royal Oak in Exminster, Devon, said she would definitely follow up on reclaiming bank charges.
"It's so hard in the first year of trading and I guess we were charged about £1,000.
"We have a good rapport with our bank manager and will be making an appointment to go and see him."
Joan Henderson of the Woodmine Inn, Ashton-under-Lyme, Lancashire said: "I plan to reclaim £1,300."
The Office of Fair Trading, due to report on this issue in April, is expected to set a maximum fee somewhere between £12 and £20.
Tracy Bond of the Duke of York in Crediton, Devon is one of around 2m people nationwide who have joined the revolt against fees imposed for unauthorised overdrafts. The fees are meant to cover administration costs, estimated at about £4.50 rather than the £35 some banks charge.
The law currently allows claims to be made for the previous six years.
"I have given my bank, NatWest, two weeks to respond to my claim for £7,930 in penalty charges over five years," she said.
Bond claims that at times during the early years at the freehouse she was having to swallow £500 a week in penalty charges.
"The bank didn't seem to care if I was over my limit - they just carried on charging me fees," she said.
Ali Wittwer of the Royal Oak in Exminster, Devon, said she would definitely follow up on reclaiming bank charges.
"It's so hard in the first year of trading and I guess we were charged about £1,000.
"We have a good rapport with our bank manager and will be making an appointment to go and see him."
Joan Henderson of the Woodmine Inn, Ashton-under-Lyme, Lancashire said: "I plan to reclaim £1,300."
The Office of Fair Trading, due to report on this issue in April, is expected to set a maximum fee somewhere between £12 and £20.
Breaking the bank
A customer who took on his bank after it refused to supply details of illegal charges on his account is celebrating victory.
Andrew Banner, 37, fought back after he became a victim of bully-boy tactics increasingly being used by the banks to avoid refunding millions of pounds of penalty fees.
He first won an order for legal costs against Abbey, then threatened to send in the bailiffs if it did not pay up and eventually forced the bank to hand over more than £1,000.
Hundreds of thousands of customers are demanding refunds after the Office of Fair Trading ruled that charges of up to £39 for busting an overdraft limit or bouncing a cheque were unfair and illegal.
Mr Banner, a married father of three from Martham, Norfolk, asked Abbey to supply statements dating back 18 months so he could total up the charges made on his account and make a claim. However, the bank refused on the grounds that it did not have to provide information held in its archives.
Initially, Mr Banner accepted the rebuff, but then he discovered the tactic was illegal after consulting the website consumeractiongroup.co.uk. The Data Protection Act states that banks must supply all statements in return for a £10 fee.
'I realised the bank's claim it did not have to supply the statements was hogwash,' said Mr Banner. 'I started to get angry and then decided to do something about it. My concern is that we are not valued customers, we're people to take advantage of.'
Mr Banner, a website developer, launched a case at Lowestoft County Court to force Abbey to provide the information. The bank caved in before the case went before a judge but Mr Banner was awarded £30 costs, which Abbey failed to pay within a deadline.
He therefore instructed bailiffs to collect the money on his behalf and, after they contacted Abbey, the bank paid up. Mr Banner then launched a second legal claim for a refund of the penalty charges imposed on his account during the 18 months covered by the statements, plus costs.
The bank defended the case initially, drawing out the process yet further, before paying the claim for £1,050 in full.
Mr Banner said: 'I haven't got a problem with these banks charging for a breach of the contract but the charges are arbitrary amounts and are not just covering the costs of a breach. Therefore these charges are unlawful.'
The bank defended its approach to charges, saying: 'Abbey is up front and transparent about all its banking charges as set out in its Tariff of Charges. Any complaint that we receive is treated on a case by case basis.'
The Daily Mail has campaigned against the rip- off penalty fees, which the OFT ruled were far in excess of administrative costs and simply a way of boosting profits.
Customers can reclaim charges dating back six years. Failing to hand over statements is one of a raft of tactics being used by the banks to make it difficult to obtain refunds.
Under the terms of the Data Protection Act, statements should be supplied within 40 days. But some banks are taking far longer. Others have taken revenge on customers seeking refunds by shutting their accounts at short notice. HSBC wrote to some customers closing their account and advising there was no point in complaining to the Financial Ombudsman because he had no jurisdiction in this area.
That is not true, with the result that the bank has been reported to the City watchdog, the Financial Services Authority.
Nationwide recently said it would halt settling any more claims for refunds until the OFT has issued a final decision on the issue. However, it was forced into a Uturn because this did not comply with the banking code
Andrew Banner, 37, fought back after he became a victim of bully-boy tactics increasingly being used by the banks to avoid refunding millions of pounds of penalty fees.
He first won an order for legal costs against Abbey, then threatened to send in the bailiffs if it did not pay up and eventually forced the bank to hand over more than £1,000.
Hundreds of thousands of customers are demanding refunds after the Office of Fair Trading ruled that charges of up to £39 for busting an overdraft limit or bouncing a cheque were unfair and illegal.
Mr Banner, a married father of three from Martham, Norfolk, asked Abbey to supply statements dating back 18 months so he could total up the charges made on his account and make a claim. However, the bank refused on the grounds that it did not have to provide information held in its archives.
Initially, Mr Banner accepted the rebuff, but then he discovered the tactic was illegal after consulting the website consumeractiongroup.co.uk. The Data Protection Act states that banks must supply all statements in return for a £10 fee.
'I realised the bank's claim it did not have to supply the statements was hogwash,' said Mr Banner. 'I started to get angry and then decided to do something about it. My concern is that we are not valued customers, we're people to take advantage of.'
Mr Banner, a website developer, launched a case at Lowestoft County Court to force Abbey to provide the information. The bank caved in before the case went before a judge but Mr Banner was awarded £30 costs, which Abbey failed to pay within a deadline.
He therefore instructed bailiffs to collect the money on his behalf and, after they contacted Abbey, the bank paid up. Mr Banner then launched a second legal claim for a refund of the penalty charges imposed on his account during the 18 months covered by the statements, plus costs.
The bank defended the case initially, drawing out the process yet further, before paying the claim for £1,050 in full.
Mr Banner said: 'I haven't got a problem with these banks charging for a breach of the contract but the charges are arbitrary amounts and are not just covering the costs of a breach. Therefore these charges are unlawful.'
The bank defended its approach to charges, saying: 'Abbey is up front and transparent about all its banking charges as set out in its Tariff of Charges. Any complaint that we receive is treated on a case by case basis.'
The Daily Mail has campaigned against the rip- off penalty fees, which the OFT ruled were far in excess of administrative costs and simply a way of boosting profits.
Customers can reclaim charges dating back six years. Failing to hand over statements is one of a raft of tactics being used by the banks to make it difficult to obtain refunds.
Under the terms of the Data Protection Act, statements should be supplied within 40 days. But some banks are taking far longer. Others have taken revenge on customers seeking refunds by shutting their accounts at short notice. HSBC wrote to some customers closing their account and advising there was no point in complaining to the Financial Ombudsman because he had no jurisdiction in this area.
That is not true, with the result that the bank has been reported to the City watchdog, the Financial Services Authority.
Nationwide recently said it would halt settling any more claims for refunds until the OFT has issued a final decision on the issue. However, it was forced into a Uturn because this did not comply with the banking code
Paying off bank charge victims
Banks are trying to pay off customers who they believe might be about to complain about their overdraft charges to stop them trying to reclaim even greater sums.
In one case, mum Rebecca Bill was offered a cheque for £2,400 before she had even complained about her bank charges. When she later added up her overdraft charges it came to a whopping £13,000. It is the latest ploy by banks as they try to cut the amount of charges customers are being forced to pay.
Rebecca, from Wadhurst, in East Sussex, knew she had paid charges when she had gone overdrawn on her Abbey account in the past six years. She used a template letter to ask for a list of all those she had paid.
She made no mention of her plans to reclaim the charges at a later date. However, Abbey wrote back offering to repay £2,400 as a goodwill gesture.
Rebecca - pictured with her three children - Lucy, 13, Fay, three, and Freddie, one - says: 'I became suspicious when they did this. I guessed that I was owed more than this but still did not have the statements to prove it.'
Rebecca declined the refund and again demanded her statements. The bank offered her the refund again, but after turning it down for a second time she was eventually sent her charges. When she totalled them up, they came to £13,000 in the past six years.
She is now taking Abbey to court. And Rebecca is not alone. Money Mail's postbag and online consumer groups have received similar stories of banks offering to settle for a paltry sum before any complaint is made. Abbey says that its initial offer was a goodwill gesture and believes in dealing with customers fairly and openly.
For the past year Money Mail's Fair Play On Charges campaign has helped tens of thousands of bank current account customers get a refund on charges incurred for payments that are bounced or authorised when they have slipped a few pounds in to the red.
In response to this consumer backlash, some banks have refused to assist customers in getting their statements or list of charges; others have threatened to cancel customers' accounts if they complain
In one case, mum Rebecca Bill was offered a cheque for £2,400 before she had even complained about her bank charges. When she later added up her overdraft charges it came to a whopping £13,000. It is the latest ploy by banks as they try to cut the amount of charges customers are being forced to pay.
Rebecca, from Wadhurst, in East Sussex, knew she had paid charges when she had gone overdrawn on her Abbey account in the past six years. She used a template letter to ask for a list of all those she had paid.
She made no mention of her plans to reclaim the charges at a later date. However, Abbey wrote back offering to repay £2,400 as a goodwill gesture.
Rebecca - pictured with her three children - Lucy, 13, Fay, three, and Freddie, one - says: 'I became suspicious when they did this. I guessed that I was owed more than this but still did not have the statements to prove it.'
Rebecca declined the refund and again demanded her statements. The bank offered her the refund again, but after turning it down for a second time she was eventually sent her charges. When she totalled them up, they came to £13,000 in the past six years.
She is now taking Abbey to court. And Rebecca is not alone. Money Mail's postbag and online consumer groups have received similar stories of banks offering to settle for a paltry sum before any complaint is made. Abbey says that its initial offer was a goodwill gesture and believes in dealing with customers fairly and openly.
For the past year Money Mail's Fair Play On Charges campaign has helped tens of thousands of bank current account customers get a refund on charges incurred for payments that are bounced or authorised when they have slipped a few pounds in to the red.
In response to this consumer backlash, some banks have refused to assist customers in getting their statements or list of charges; others have threatened to cancel customers' accounts if they complain
'Banks and building societies are ripping off customers'
Banks and building societies have been accused of ripping off customers by hiking mortgage fees by nearly 20 per cent since last summer.
Over the last seven months, the average "arrangement fee" to take out a fixed-rate home loan has soared to nearly £600.
The research, published Thursday, accuses firms of boosting their profits by penalising homeowners who take out a fixed-rate mortgage.
The highest arrangement fee - a charge simply for taking out a mortgage - is nearly £2,000.
Thousands of homeowners have rushed to fix their mortgage because interest rates have been raised three times since August by the Bank of England.
The Bank of England kept rates on hold yesterday at 5.25 per cent but a fourth rise is expected soon, possibly next month.
Nearly two-thirds of homeowners are currently taking out a fixed rate mortgage which protects them from any further rate rises.
But such security comes at a price, according to the research from the financial website MoneyExpert.com.
Before the first of the three rate rises, just 13 fixed rate mortgages had an arrangement fee of more than £750. Today, there are nearly 100.
And the number which charge less than £500 has dropped from about 350 to about 250.
On Thursday experts accused banks and building societies of taking advantage of hard-pressed homeowners who are struggling with the extra cost.
James Cotton, mortgage specialist at the advisers London & Country Mortgages, said: "There is a difference between charging a high fee in return for a low interest rate, and simply charging high fees for the sake of it."
A spokesman for Moneyfacts, the financial information firm, said it fears some lenders are "profiteering".
She said: "There could be a bit of profiteering out there. Some lenders have kept their interest rates low but pushed up the fees."
Sean Gardner, chief executive of MoneyExpert.com, said: "Homeowners are desperate to fix their mortgage rates to avoid incurring further costs caused by rising interest rates.
"It is the sensible option as further rises are not out of the question. But banks aren't stupid."
One of the biggest culprits is Northern Rock, Britain's fifth largest lender, which has an arrangement fee of £1,995 on some of its fixed rate deals.
Britain's biggest lender, Halifax, also charges a steep £1,499 fee for some of its fixed rate deals.
One lender, Bank of Scotland, charges £2,499, but this is only on mortgages of £500,000 or more.
For people with such large loans, a high arrangement fee can still be a good deal as a low interest rate makes their monthly payments so much cheaper.
Mr Cotton said: "For some people with a mortgage of over £150,000, they could actually be better off paying a big fee to get a lower interest rate."
To add insult to injury, many banks and building societies are short-changing savers at the same time as charging high fees to homeowners.
While the Bank of England base rate has risen 0.75 percentage points, the rate on some savings accounts has been increased by less than 0.25 per cent.
They have not been so slow at passing on interest rate rises to their mortgage borrowers.
For example, the Royal Bank of Scotland has increased its standard variable rate mortgage by 0.85 percentage points since last August.
It comes as the Halifax said Thursday there are strong signals that the booming housing market is finally beginning to slow down.
The bank expects house prices will rise just four per cent this year, which is below inflation, currently 4.4 per cent.
Prices rose 1.3 per cent in January to an average price of £188,623, but they fell by 0.9 per cent in December, which is typical of a "slowing market".
Chief economist Martin Ellis said the interest rate rises will cause "more caution" among potential homebuyers worried about the cost of a home loan.
Over the last seven months, the average "arrangement fee" to take out a fixed-rate home loan has soared to nearly £600.
The research, published Thursday, accuses firms of boosting their profits by penalising homeowners who take out a fixed-rate mortgage.
The highest arrangement fee - a charge simply for taking out a mortgage - is nearly £2,000.
Thousands of homeowners have rushed to fix their mortgage because interest rates have been raised three times since August by the Bank of England.
The Bank of England kept rates on hold yesterday at 5.25 per cent but a fourth rise is expected soon, possibly next month.
Nearly two-thirds of homeowners are currently taking out a fixed rate mortgage which protects them from any further rate rises.
But such security comes at a price, according to the research from the financial website MoneyExpert.com.
Before the first of the three rate rises, just 13 fixed rate mortgages had an arrangement fee of more than £750. Today, there are nearly 100.
And the number which charge less than £500 has dropped from about 350 to about 250.
On Thursday experts accused banks and building societies of taking advantage of hard-pressed homeowners who are struggling with the extra cost.
James Cotton, mortgage specialist at the advisers London & Country Mortgages, said: "There is a difference between charging a high fee in return for a low interest rate, and simply charging high fees for the sake of it."
A spokesman for Moneyfacts, the financial information firm, said it fears some lenders are "profiteering".
She said: "There could be a bit of profiteering out there. Some lenders have kept their interest rates low but pushed up the fees."
Sean Gardner, chief executive of MoneyExpert.com, said: "Homeowners are desperate to fix their mortgage rates to avoid incurring further costs caused by rising interest rates.
"It is the sensible option as further rises are not out of the question. But banks aren't stupid."
One of the biggest culprits is Northern Rock, Britain's fifth largest lender, which has an arrangement fee of £1,995 on some of its fixed rate deals.
Britain's biggest lender, Halifax, also charges a steep £1,499 fee for some of its fixed rate deals.
One lender, Bank of Scotland, charges £2,499, but this is only on mortgages of £500,000 or more.
For people with such large loans, a high arrangement fee can still be a good deal as a low interest rate makes their monthly payments so much cheaper.
Mr Cotton said: "For some people with a mortgage of over £150,000, they could actually be better off paying a big fee to get a lower interest rate."
To add insult to injury, many banks and building societies are short-changing savers at the same time as charging high fees to homeowners.
While the Bank of England base rate has risen 0.75 percentage points, the rate on some savings accounts has been increased by less than 0.25 per cent.
They have not been so slow at passing on interest rate rises to their mortgage borrowers.
For example, the Royal Bank of Scotland has increased its standard variable rate mortgage by 0.85 percentage points since last August.
It comes as the Halifax said Thursday there are strong signals that the booming housing market is finally beginning to slow down.
The bank expects house prices will rise just four per cent this year, which is below inflation, currently 4.4 per cent.
Prices rose 1.3 per cent in January to an average price of £188,623, but they fell by 0.9 per cent in December, which is typical of a "slowing market".
Chief economist Martin Ellis said the interest rate rises will cause "more caution" among potential homebuyers worried about the cost of a home loan.
Bank charge campaign 'strikes a chord with customers'
A campaign against bank charges by consumer group Which? has "struck a real chord with the public", according to the organisation's personal finance campaigner Emma Bandey.Ms Bandey also suggests that Which? is delighted to see that so many people have decided to take on their bank to reclaim charges that they deem unfair.Her comments follow news from the company that there has now been over a quarter of a million templates for reclaiming bank charges downloaded from its website.In total, it is revealed that 262,400 templates and factsheets have been accessed, which indicates that many people in the UK are beginning to address their finances and take on their bank."We hear, almost on a daily basis, from people who have successfully claimed back hundreds, or even thousands of pounds from the banks" said Ms Bandey."Claiming back bank charges is a simple and straightforward process. Don't be put off from reclaiming your charges, get back the money you're owed." Last month, the Liberal Democrats' shadow chancellor Vincent Cable said that bank's profits were often based on the exploitation of "vulnerable customers" through unfair and illegal charges.
Consumers urged to pay attention to new bank charges
Consumers are being urged to do their research in the light of new charges being levied by banks. The warning was voiced by price comparison website uSwitch.com after a number of banks reported that large proportions of their profits for 2006 were written off as people fell victim to insolvency. Nick White, director of financial services at uSwitch.com, said: "We shouldn't lose sight of how important banks are to the economy, but at the same time individual consumers need to be very aware of their own bank, their own products and any new charges being introduced." He added that consumers must try to be "on their guard" this year as banks continue to roll out new charges. One form of charging that has come under scrutiny recently is mortgage exit charges. Comparing banks' total profits with the amount they wrote off last year due to failed loan repayments, uSwitch.com found HSBC was top with 46 per cent of its profits written off. Lloyds and Barclays were second and third at 37 and 30 per cent respectively.
Bureau's advice over shock bank charges
NORTH Somerset Citizens Advice Bureau (CAB) is helping an increasing number of clients in the area to challenge their banks after being hit by unexpected charges.One disabled client on a low income was charged £35 for a £4.20 transaction on his overdraft and a young couple were charged over £400 in 24 hours in bank charges.Creditors such as banks, credit card and store companies can apply reasonable charges for breaches of an agreement, such as going into an unauthorised overdraft. However, the charge should just cover the administrative cost to the creditor of dealing with the breach and some banks' charges have been successfully challenged as excessive.CAB manager, Anne Richards, said: "Excessive bank charges can dramatically increase clients' debt, making it even more difficult to get themselves out of financial difficulty. We are seeing an increasing number of people who have got into debt through bank charges."The CAB has a few tips to help people reclaim their money:* You can claim a refund of charges paid during the past six years. You can write to the bank to ask for the information, which it must provide under the Data Protection Act. If it charges you for it, it cannot be more than £10.* Write to your bank and ask it to waive or reduce the charges as a goodwill gesture, explaining the reasons for your default.* If that is not successful write a stronger letter pointing out the legal arguments for refunding or reducing the charges. * If the bank still does not agree to a refund it can be taken to the small claims court. There is a small fee, but it will be refunded if the case is successful.* A complaint can also be made to the Financial Ombudsman Service (FOS).For more information, draft letters to write to the bank, or an advice leaflet contact the CAB on 01934 836201.
Wednesday, 7 March 2007
Bumper £8.5m payday for HSBC boss - for only five months work
A fat cat row has erupted after it emerged that a boss at HSBC collected more than £5.3 million for just five months' work.
The size of the windfall for Sir John Bond, the bank's former chairman, provoked fury among consumers.
For HSBC, together with the rest of the big banks, is in the dock amid allegations of ripping off customers through illegal penalty charges and rigged interest rates. Sir John, aged 66, has described himself in the past as "just an ordinary bloke who has been very lucky". HSBC figures show he received a salary of £602,000 and bonuses of £1.458 million for the January to May period. This was boosted by some £6.6 million in share awards, half of which related to his service in 2006 and half for 2005. Sir John, who was with the bank for 45 years, also amassed a vast pension pot of £11.4 million which generates an income of £494,000 a year. If that were not enough, he has walked into another top job as chairman of the mobile phone giant, Vodafone, which pays another £475,000. The huge payments are remarkable, particularly when set against a relatively disappointing five per cent increase in the bank's profits for 2006. The increase was modest compared to Britain's other big banks, however the final profits total was still a mammoth £12 billion. The bank's profits would have been higher but for massive bad debts of some £5.7 billion, which were largely generated from failures in its home loan business in the United States. In February HSBC dismissed two senior executives in its US arm, but not before the men had collected bonuses of more than £20 million. The notion of rewards for failure have brought City institutions into disrepute both with shareholders and customers. They are particularly controversial given an explosion of customer fury over current account penalty charges and a poor deals on interest rates. The Office of Fair Trading has ruled that bank penalty charges for bouncing payments of up to £35 a time are both unfair and illegal. As a result, HSBC, together with other banks, is currently receiving thousands of refund claims from angry customers who have been overcharged in the past. Evidence has also emerged that HSBC and others have taken advantage of recent increases in the Bank of England base rate to boost their profit margins. HSBC has lifted its mortgage rate by 1.76 points to 6.25per cent over the last three years, however the rates paid to savers have gone up by only 0.66 per cent. This means the bank has increased its profit margin by 1.1 per cent, according to analysts Moneyfacts. The HSBC figures mean the total profits amassed by Britain's biggest banks for 2006 topped a record £40 billion for the first time. Eddy Weatherill, of the Independent Banking Advisory Services, said: "The banks are a licence to print money and it is clear that rule extends right the way through to the directors and executives. "Payments running into millions of pounds for just a few months work will stick in the throat of customers who have been unfairly treated. "By any measure, the banks's top executives are picking up huge rewards for failure, the failure to offer customers fair charges and good value financial products." The Lib-Dem shadow chancellor, Vincent Cable MP, complained: "Big pay days for a few directors sadly still means customers are being hit by excessive charges. "Bank profits are being boosted not only by unfair and in some cases illegal charges but also by giving customers a raw deal on interest rates. "It is simply unacceptable that banks are treating customers in this fashion and I urge customers to complain if they believe they are being cheated." The finance union Amicus complained the pay rise for ordinary HSBC staff has been pegged below inflation. Union official, John Nolan, said: "It is outrageous that an organisation which reports these profits insists on a below inflation pay rise."
The multi-millionaire, Sir John Bond, who is originally from Bristol, is described in profiles as "thoroughly modest and unassuming". Among his guiding philosophies is said to be the Chinese proverb: "Today, you're a rooster, tomorrow you're a feather duster". Critics will argue that £5.3 million buys quite a few feather dusters. An HSBC spokesman said: "Look at the growth of the company since Sir John became chairman in 1998 to 2006 when he retired. "We are substantially larger company and a substantially more profitable company."
HSBC is in the vanguard of controversial moves to introduce fees on current accounts in this country, so killing so-called free banking.
Executives at the bank have described the introduction of charging, on the model that exists in North America, Europe and Australia, as "inevitable".
The bank's telephone and internet subsidiary, First Direct, became the first mainstream bank to force charges on up to 200,000 customers last year. First Direct is charging £10 a month, while other finance giants are expected to follow suit.
On Monday the bank's chief executive, Michael Geoghegan, refused to rule out extending such charges.
He said: "We offer free banking today and we will offer it tomorrow, but I am not making a commitment for time immemorial. We will have to see how the market develops over time."
The size of the windfall for Sir John Bond, the bank's former chairman, provoked fury among consumers.
For HSBC, together with the rest of the big banks, is in the dock amid allegations of ripping off customers through illegal penalty charges and rigged interest rates. Sir John, aged 66, has described himself in the past as "just an ordinary bloke who has been very lucky". HSBC figures show he received a salary of £602,000 and bonuses of £1.458 million for the January to May period. This was boosted by some £6.6 million in share awards, half of which related to his service in 2006 and half for 2005. Sir John, who was with the bank for 45 years, also amassed a vast pension pot of £11.4 million which generates an income of £494,000 a year. If that were not enough, he has walked into another top job as chairman of the mobile phone giant, Vodafone, which pays another £475,000. The huge payments are remarkable, particularly when set against a relatively disappointing five per cent increase in the bank's profits for 2006. The increase was modest compared to Britain's other big banks, however the final profits total was still a mammoth £12 billion. The bank's profits would have been higher but for massive bad debts of some £5.7 billion, which were largely generated from failures in its home loan business in the United States. In February HSBC dismissed two senior executives in its US arm, but not before the men had collected bonuses of more than £20 million. The notion of rewards for failure have brought City institutions into disrepute both with shareholders and customers. They are particularly controversial given an explosion of customer fury over current account penalty charges and a poor deals on interest rates. The Office of Fair Trading has ruled that bank penalty charges for bouncing payments of up to £35 a time are both unfair and illegal. As a result, HSBC, together with other banks, is currently receiving thousands of refund claims from angry customers who have been overcharged in the past. Evidence has also emerged that HSBC and others have taken advantage of recent increases in the Bank of England base rate to boost their profit margins. HSBC has lifted its mortgage rate by 1.76 points to 6.25per cent over the last three years, however the rates paid to savers have gone up by only 0.66 per cent. This means the bank has increased its profit margin by 1.1 per cent, according to analysts Moneyfacts. The HSBC figures mean the total profits amassed by Britain's biggest banks for 2006 topped a record £40 billion for the first time. Eddy Weatherill, of the Independent Banking Advisory Services, said: "The banks are a licence to print money and it is clear that rule extends right the way through to the directors and executives. "Payments running into millions of pounds for just a few months work will stick in the throat of customers who have been unfairly treated. "By any measure, the banks's top executives are picking up huge rewards for failure, the failure to offer customers fair charges and good value financial products." The Lib-Dem shadow chancellor, Vincent Cable MP, complained: "Big pay days for a few directors sadly still means customers are being hit by excessive charges. "Bank profits are being boosted not only by unfair and in some cases illegal charges but also by giving customers a raw deal on interest rates. "It is simply unacceptable that banks are treating customers in this fashion and I urge customers to complain if they believe they are being cheated." The finance union Amicus complained the pay rise for ordinary HSBC staff has been pegged below inflation. Union official, John Nolan, said: "It is outrageous that an organisation which reports these profits insists on a below inflation pay rise."
The multi-millionaire, Sir John Bond, who is originally from Bristol, is described in profiles as "thoroughly modest and unassuming". Among his guiding philosophies is said to be the Chinese proverb: "Today, you're a rooster, tomorrow you're a feather duster". Critics will argue that £5.3 million buys quite a few feather dusters. An HSBC spokesman said: "Look at the growth of the company since Sir John became chairman in 1998 to 2006 when he retired. "We are substantially larger company and a substantially more profitable company."
HSBC is in the vanguard of controversial moves to introduce fees on current accounts in this country, so killing so-called free banking.
Executives at the bank have described the introduction of charging, on the model that exists in North America, Europe and Australia, as "inevitable".
The bank's telephone and internet subsidiary, First Direct, became the first mainstream bank to force charges on up to 200,000 customers last year. First Direct is charging £10 a month, while other finance giants are expected to follow suit.
On Monday the bank's chief executive, Michael Geoghegan, refused to rule out extending such charges.
He said: "We offer free banking today and we will offer it tomorrow, but I am not making a commitment for time immemorial. We will have to see how the market develops over time."
Fury at £40bn bank profit
A new bank row exploded today as HSBC announced record profits, bringing the total for High Street institutions to just under £40 billion.
HSBC - Europe's biggest bank - said it was £11.9 billion in the black last year. Critics accused it and major rivals of profiteering through high charges and irresponsible lending.
It is estimated that in total, the banks made an average £112.20 profit per customer last year through charges, fees and the clearing system - up 12 per cent on 2005.
Vince Cable, the Liberal Democrats' Treasury spokesman, said: "Banks are still enjoying excessive profits, based all too often on the exploitation of vulnerable customers through unfair, and in some cases illegal, bank charges."
He called on Chancellor Gordon Brown to order a full review of the banking sector. But HSBC's chairman Stephen Green said the figures were "a testament to HSBC's strength and diversity".
Today's statistics round off the most controversial season of bank results on record, and come amid a breakdown in relations between the companies and huge numbers of customers.
There has been resentment over the cost of banking, poor service, and vast profits made by the "big five": HSBC, NatWest owner Royal Bank of Scotland, Barclays, HBoS, and Lloyds TSB.
Charges on current accounts are said to make £4.7 billion in revenue for the banks. They deny it is this high, but will not disclose the real figures.
Up to one million customers are preparing to sue their banks in an attempt to reclaim charges for unauthorised overdrafts and bounced cheques.
The Office of Fair Trading is due to rule later this month whether the banks have acted illegally in hitting customers with charges of £30 or more. The OFT is expected to say that figure is far too high. Meanwhile the City's watchdog, the Financial Services Authority is investigating how the banks have handled customer complaints.
Today there were calls for bank customers to abandon the high street giants. James Alexander, co-founder of Zopa - an online "marketplace" where people can borrow and lend money - said: "The truth is that banks in the UK have let down their customers, despite the promises implied by big-budget advertising, and against a backdrop of what any objective analysis would say is excessive profitmaking."
The banking industry has defended its profits, saying they are essential for the health of the economy and pension funds that will support millions of people.
They also point out that Britain's provision of "free" incredit current accounts is unique in the developed world, and warn this could be under threat if regulators are too heavy handed in their approach.
They also argue that a diminishing share of their profits are made from the high street
HSBC - Europe's biggest bank - said it was £11.9 billion in the black last year. Critics accused it and major rivals of profiteering through high charges and irresponsible lending.
It is estimated that in total, the banks made an average £112.20 profit per customer last year through charges, fees and the clearing system - up 12 per cent on 2005.
Vince Cable, the Liberal Democrats' Treasury spokesman, said: "Banks are still enjoying excessive profits, based all too often on the exploitation of vulnerable customers through unfair, and in some cases illegal, bank charges."
He called on Chancellor Gordon Brown to order a full review of the banking sector. But HSBC's chairman Stephen Green said the figures were "a testament to HSBC's strength and diversity".
Today's statistics round off the most controversial season of bank results on record, and come amid a breakdown in relations between the companies and huge numbers of customers.
There has been resentment over the cost of banking, poor service, and vast profits made by the "big five": HSBC, NatWest owner Royal Bank of Scotland, Barclays, HBoS, and Lloyds TSB.
Charges on current accounts are said to make £4.7 billion in revenue for the banks. They deny it is this high, but will not disclose the real figures.
Up to one million customers are preparing to sue their banks in an attempt to reclaim charges for unauthorised overdrafts and bounced cheques.
The Office of Fair Trading is due to rule later this month whether the banks have acted illegally in hitting customers with charges of £30 or more. The OFT is expected to say that figure is far too high. Meanwhile the City's watchdog, the Financial Services Authority is investigating how the banks have handled customer complaints.
Today there were calls for bank customers to abandon the high street giants. James Alexander, co-founder of Zopa - an online "marketplace" where people can borrow and lend money - said: "The truth is that banks in the UK have let down their customers, despite the promises implied by big-budget advertising, and against a backdrop of what any objective analysis would say is excessive profitmaking."
The banking industry has defended its profits, saying they are essential for the health of the economy and pension funds that will support millions of people.
They also point out that Britain's provision of "free" incredit current accounts is unique in the developed world, and warn this could be under threat if regulators are too heavy handed in their approach.
They also argue that a diminishing share of their profits are made from the high street
Bank Charges Reclaiming. Payouts may be cut. Act now!
From Martin Lewis the money saving expert
(Get your facts straight Lewis)
In April, the Office of Fair Trading will give its opinion on the appropriate amount for bank charges. My guess is it'll be £12, though the banks predict higher and I think it should be lower. The banks will be under huge pressure to drop charges across the board, and will probably fall into line. This won't stop people reclaiming past charges, however banks may only offer the difference between £12 and the amount you were originally charged (e.g. £35 - £12 = £23). If you don't accept it, the risk they may defend in court for the first time, citing the OFT ruling, is a tiny bit higher. To avoid all this, reclaim now!
(Get your facts straight Lewis)
In April, the Office of Fair Trading will give its opinion on the appropriate amount for bank charges. My guess is it'll be £12, though the banks predict higher and I think it should be lower. The banks will be under huge pressure to drop charges across the board, and will probably fall into line. This won't stop people reclaiming past charges, however banks may only offer the difference between £12 and the amount you were originally charged (e.g. £35 - £12 = £23). If you don't accept it, the risk they may defend in court for the first time, citing the OFT ruling, is a tiny bit higher. To avoid all this, reclaim now!
MoneyExpert.com - FOS concerned at complaints
The Financial Ombudsman Service (FOS) is reportedly concerned at an increasing number of complaints it is receiving about banks and building societies.FOS spokesman David Cresswell raised the issue on BBC Two programme Working Lunch .One viewer complained that her bank had closed her current account in the wake of her successful claim for a refund of excessive charges.Mr Cresswell said that any case where there was an "obvious" link between consumer action and the closing of an account would "most concern the ombudsman".And he added that customers have a legal right to complain that should not be undermined by bank action that makes them feel "intimidated".However, he did qualify that statement by saying that in some circumstances, the bank may feel that the relationship with the customer has entirely broken down. Bank and building society charges came under inspection from the Office of Fair Trading last year amid mounting consumer complaints. A increasing number of mediums are urging customers to reclaim any bank charges they have paid in the past six years, with several websites offering step-by-step instructions.
'Minimal reaction' to bank charges
FIRST DIRECT reported a reduction in bad debts yesterday and said it had seen little damage to business following its decision to end free banking for current account customers who pay in less than £1,500 a month.
Leeds-based First Direct, the UK telephone and internet banking division of HSBC, will become the first bank to introduce charges. Consumer campaigners have described the move as the first step towards the end of free banking in the UK. But First Direct claims that 85 per cent of its customers will be unaffected by the £10 a month charge and the move is aimed at dormant or rarely used accounts. Speaking at parent company HSBC's annual results yesterday, First Direct chief executive Chris Pilling said a very small percentage of customers had closed their accounts. "It's really aimed at people who weren't using us as their main bank or whose account was dormant. We've lost less than 5 per cent of our customers, yet we have seen a very encouraging move towards customers taking out other products such as savings accounts, credit cards, mortgages, loans and ISAs because they want to stay with us," he said.
Customers who get paid or keep a balance of less than £1,500 a month won't be charged as long as they take on another First Direct service such as a savings account or a loan. Yesterday HSBC's UK banking operation reported a 3 per cent reduction in bad debts to £796m in 2006 and Mr Pilling said that First Direct's bad debts were at a similar level. "That's thanks to better systems and more analytical data. "We are blessed with a more affluent customer base and while we're not immune to trends we have seen a good performance in challenging markets," he said. In the UK, HSBC saw a 13 per cent increase in pre-tax profits to £1.87bn. The bank is to tighten lending requirements and expects to increase its refusal rates from 20 per cent to 30 per cent, although First Direct has no plans to follow suit. Mr Pilling said the recent interest rate increases had affected the business. "People are sensitive to rate hikes, there is a sense of conservatism – people are taking more care of their money. We expect our ISA product to do very well," he said. HSBC, Europe's biggest bank, reported a 5 per cent increase in profits to £11.48bn yesterday, but was hit by an increase in bad debts at its US mortgages operation. The bank took a £5.49bn hit for bad debts as a result of rising numbers of US borrowers defaulting on their mortgages. The head of HSBC's US division, Bobby Mehta, resigned two weeks ago. The group said it was confident the problems would not spread to other parts of the world. First Direct, which employs 2,700 people at Stourton, Leeds, hired 500 people last year and it intends to take on a further 300 staff this year. "We've got one of the lowest levels of colleague churn in Yorkshire call centres. It's about 10 per cent whereas most companies are seeing a loss of around 30-35 per cent. The culture is exceptionally good, for example we have the largest work creche in Britain. "We have a lot of young working mums and it means a lot to them to know their children are close by," said Mr Pilling.
Leeds-based First Direct, the UK telephone and internet banking division of HSBC, will become the first bank to introduce charges. Consumer campaigners have described the move as the first step towards the end of free banking in the UK. But First Direct claims that 85 per cent of its customers will be unaffected by the £10 a month charge and the move is aimed at dormant or rarely used accounts. Speaking at parent company HSBC's annual results yesterday, First Direct chief executive Chris Pilling said a very small percentage of customers had closed their accounts. "It's really aimed at people who weren't using us as their main bank or whose account was dormant. We've lost less than 5 per cent of our customers, yet we have seen a very encouraging move towards customers taking out other products such as savings accounts, credit cards, mortgages, loans and ISAs because they want to stay with us," he said.
Customers who get paid or keep a balance of less than £1,500 a month won't be charged as long as they take on another First Direct service such as a savings account or a loan. Yesterday HSBC's UK banking operation reported a 3 per cent reduction in bad debts to £796m in 2006 and Mr Pilling said that First Direct's bad debts were at a similar level. "That's thanks to better systems and more analytical data. "We are blessed with a more affluent customer base and while we're not immune to trends we have seen a good performance in challenging markets," he said. In the UK, HSBC saw a 13 per cent increase in pre-tax profits to £1.87bn. The bank is to tighten lending requirements and expects to increase its refusal rates from 20 per cent to 30 per cent, although First Direct has no plans to follow suit. Mr Pilling said the recent interest rate increases had affected the business. "People are sensitive to rate hikes, there is a sense of conservatism – people are taking more care of their money. We expect our ISA product to do very well," he said. HSBC, Europe's biggest bank, reported a 5 per cent increase in profits to £11.48bn yesterday, but was hit by an increase in bad debts at its US mortgages operation. The bank took a £5.49bn hit for bad debts as a result of rising numbers of US borrowers defaulting on their mortgages. The head of HSBC's US division, Bobby Mehta, resigned two weeks ago. The group said it was confident the problems would not spread to other parts of the world. First Direct, which employs 2,700 people at Stourton, Leeds, hired 500 people last year and it intends to take on a further 300 staff this year. "We've got one of the lowest levels of colleague churn in Yorkshire call centres. It's about 10 per cent whereas most companies are seeing a loss of around 30-35 per cent. The culture is exceptionally good, for example we have the largest work creche in Britain. "We have a lot of young working mums and it means a lot to them to know their children are close by," said Mr Pilling.
Grieving family hit with charges
A grieving family was forced to fight for a refund of overdraft fees after Lloyds TSB charged £250 to the account of a dead relative.
GRIEVING FAMILY: Lloyds continued to send statements with accruing charges months after Mrs Stevenson had died
Gillian Stevenson, 71, died of a heart attack on November 15 last year and her partner's daughter, Lorraine Liston, set about winding up Mrs Stevenson's affairs.
She visited the bank on November 20 and informed them of Mrs Stevenson's death, and was told there was an unpaid overdraft of £149 on the account.
Three months later, that debt has snowballed to £393.69 because of charges of £105 in cancelled direct debits, £35 for an unpaid cheque and overdraft interest.
But Lorraine had received a letter from the bank in November confirming that the account had been frozen.
Lorraine, from the Wirral in Merseyside, says: 'I'm shocked that Lloyds could handle the affairs of an elderly lady so badly. I've told them this account is closed so I don't know why these letters keep arriving. The man at the branch told me just to disregard them. I don't know why it's taking them so long to sort it out.'
Mrs Stevenson had lived with Lorraine's father, George Brown, also 71, in Wallasey, Merseyside. As they struggled on the state pension, they were hit with around £1,000 in bank charges in one year.
Since Mrs Stevenson's death, the bank has sent two letters saying that interest continued to accrue on a daily basis asking whether Lorraine would settle the debts.
Lorraine received a statement on January 8 highlighting the charges, and a second letter arrived on January 23 stating that the new charges for unpaid direct debits and other charges had been applied to the account. The letter said that Lorraine was not obliged to settle the debt personally but suggested she 'seek legal advice on the matter'.
Another statement dated February 2 said another £4.87 in interest had been added to the overdraft debt.
After This is Money intervened, Lloyds TSB, which last week announced annual profits of more than £3.71bn, agreed to refund all the charges Mrs Stevenson had accrued over the past year.
A spokesman said: 'It is always our aim to handle our customers' financial matters with sensitivity and we handle cases such as this on an individual basis.'
GRIEVING FAMILY: Lloyds continued to send statements with accruing charges months after Mrs Stevenson had died
Gillian Stevenson, 71, died of a heart attack on November 15 last year and her partner's daughter, Lorraine Liston, set about winding up Mrs Stevenson's affairs.
She visited the bank on November 20 and informed them of Mrs Stevenson's death, and was told there was an unpaid overdraft of £149 on the account.
Three months later, that debt has snowballed to £393.69 because of charges of £105 in cancelled direct debits, £35 for an unpaid cheque and overdraft interest.
But Lorraine had received a letter from the bank in November confirming that the account had been frozen.
Lorraine, from the Wirral in Merseyside, says: 'I'm shocked that Lloyds could handle the affairs of an elderly lady so badly. I've told them this account is closed so I don't know why these letters keep arriving. The man at the branch told me just to disregard them. I don't know why it's taking them so long to sort it out.'
Mrs Stevenson had lived with Lorraine's father, George Brown, also 71, in Wallasey, Merseyside. As they struggled on the state pension, they were hit with around £1,000 in bank charges in one year.
Since Mrs Stevenson's death, the bank has sent two letters saying that interest continued to accrue on a daily basis asking whether Lorraine would settle the debts.
Lorraine received a statement on January 8 highlighting the charges, and a second letter arrived on January 23 stating that the new charges for unpaid direct debits and other charges had been applied to the account. The letter said that Lorraine was not obliged to settle the debt personally but suggested she 'seek legal advice on the matter'.
Another statement dated February 2 said another £4.87 in interest had been added to the overdraft debt.
After This is Money intervened, Lloyds TSB, which last week announced annual profits of more than £3.71bn, agreed to refund all the charges Mrs Stevenson had accrued over the past year.
A spokesman said: 'It is always our aim to handle our customers' financial matters with sensitivity and we handle cases such as this on an individual basis.'
Banks to be ordered to give unfair charges back
Rip-off bank charges imposed on customers for going overdrawn or bouncing a cheque are to be outlawed.
The move follows a campaign by The Argus against unfair penalties charged by greedy banks for unauthorised borrowing.
The Office of Fair Trading will declare the fees are "unlawful" and "excessive" and order banks to refund what they have overcharged in the last six years.
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The ruling means banks will have to cut the current penalty fee of up to £38 to around £5 - or the real administrative cost of dealing with the problem - so they do not make a profit.
Angry customers from Sussex have already claimed thousands of pounds back following a landmark case where a student won £5,000 against Abbey, who charged him to £32 fees for going overdrawn by 5p.
A spokesman for the OFT said: "We think it is unlawful for banks to make money out of these charges.
"We also believe it is a breach of the banking code to close the accounts of people who do get their charges repaid."
The OFT's report is due to be published in the next three weeks and says the fines are "extravagant" and breach the law.
It will advise banks to set more realistic charges, reflecting the cost of producing a computer-generated letter.
After the report, banks will have to refund the full amount overcharged.
However, customers will probably have to write and ask for their money back rather than banks returning it automatically.
The OFT report will be the first official confirmation that banks have been acting unlawfully.
The Argus has highlighted the backlash against overcharging in a special series, showing readers how to reclaim their money.
Jack Hornsby, of Beaconsfield Villas, Brighton, followed our step-by-step guide on getting money back and received a full refund.
The 19 year old had been charged for going overdrawn using cash machines when travelling in South America.
The Co-operative Bank refunded him £200.
Graham James, 27, of Crawley, said banks were making a profit out of customers' misery and said they should not be allowed to get away with it.
He won back £4,500 from Smile and said: "Banks are taking the mickey because they are charging that kind of money for letters that cost pennies to send.
"They will charge you for going overdrawn and then charge you some more for telling you about it.
"People need to be pointed in the right direction for getting their money back."
Keith Jones, of Brede, near Hastings, is trying to get £4,500 back in charges over six years from Abbey.
The 57 year old said: "I think it is a complete farce. They charge about £35 for a computer to generate and post a letter and they are sending hundreds of these letters out each day. That amounts to a lot of profit for them."
Watchdogs like Which? and The Consumer Action Group have condemned bank charges as extortionate.
The move follows a campaign by The Argus against unfair penalties charged by greedy banks for unauthorised borrowing.
The Office of Fair Trading will declare the fees are "unlawful" and "excessive" and order banks to refund what they have overcharged in the last six years.
advertisement
do_dp_ad();
The ruling means banks will have to cut the current penalty fee of up to £38 to around £5 - or the real administrative cost of dealing with the problem - so they do not make a profit.
Angry customers from Sussex have already claimed thousands of pounds back following a landmark case where a student won £5,000 against Abbey, who charged him to £32 fees for going overdrawn by 5p.
A spokesman for the OFT said: "We think it is unlawful for banks to make money out of these charges.
"We also believe it is a breach of the banking code to close the accounts of people who do get their charges repaid."
The OFT's report is due to be published in the next three weeks and says the fines are "extravagant" and breach the law.
It will advise banks to set more realistic charges, reflecting the cost of producing a computer-generated letter.
After the report, banks will have to refund the full amount overcharged.
However, customers will probably have to write and ask for their money back rather than banks returning it automatically.
The OFT report will be the first official confirmation that banks have been acting unlawfully.
The Argus has highlighted the backlash against overcharging in a special series, showing readers how to reclaim their money.
Jack Hornsby, of Beaconsfield Villas, Brighton, followed our step-by-step guide on getting money back and received a full refund.
The 19 year old had been charged for going overdrawn using cash machines when travelling in South America.
The Co-operative Bank refunded him £200.
Graham James, 27, of Crawley, said banks were making a profit out of customers' misery and said they should not be allowed to get away with it.
He won back £4,500 from Smile and said: "Banks are taking the mickey because they are charging that kind of money for letters that cost pennies to send.
"They will charge you for going overdrawn and then charge you some more for telling you about it.
"People need to be pointed in the right direction for getting their money back."
Keith Jones, of Brede, near Hastings, is trying to get £4,500 back in charges over six years from Abbey.
The 57 year old said: "I think it is a complete farce. They charge about £35 for a computer to generate and post a letter and they are sending hundreds of these letters out each day. That amounts to a lot of profit for them."
Watchdogs like Which? and The Consumer Action Group have condemned bank charges as extortionate.
1st Post on Bank Charge Blog
Ok dont know where to start as this is my first blog, but i guess i will tell you what this blog is all about.
It isnt another one of those free consumer guides on how to reclaim charges, or a no win no fee company trying to get some business. I have set up this blog to record all the latest news on bank charges in the media, and hopefully give some usefull advice for those trying to get their charges back.
The reason i have set this up is there is alot of diferent conflicting information consumer advice sites and even by Mr Moneysaving himself on The Tonight Program. This will be a completely non biased blog which will try and give you guys the most up to date information on bank charges and getting them back.
Ok thats enough for now.
just got to decide what the next post will be
It isnt another one of those free consumer guides on how to reclaim charges, or a no win no fee company trying to get some business. I have set up this blog to record all the latest news on bank charges in the media, and hopefully give some usefull advice for those trying to get their charges back.
The reason i have set this up is there is alot of diferent conflicting information consumer advice sites and even by Mr Moneysaving himself on The Tonight Program. This will be a completely non biased blog which will try and give you guys the most up to date information on bank charges and getting them back.
Ok thats enough for now.
just got to decide what the next post will be
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