BEWARE! THE BANKS ARE OUT TO GET YOU!

[Tizer]

The Government and Bank of England have taken fright over rising house prices and is re-hashing the Funding for Lending scheme. Here is the BoE's news release:
http://www.bankofengland.co.uk/publicat ... 3/177.aspx
...and the BBC's version:
http://www.bbc.co.uk/news/business-25137444

[Stanley]

It would appear that the bankers haven't yet got the message about public indignation caused by high pay and bonuses. (LINK) Contrast their situation with the ordinary people down at the bottom of the pyramid.

[Tardis]

After the hedge fund holding the most equity in the Co-op bailed out and sold up, it looks like the private investors have finally agreed to the terms of the bank's reconstruction.

[Stanley]

Announced yesterday that the bond holders have agreed to the re-structuring plan.
RBS/NatWest/Bank of Ireland customers experienced a failure of credit and debit cards for three hours last night causing mayhem on one of the busiest shopping days of the year. Evidently the system is not yet stable. They are not pleased!

[Stanley]

Customers still complaining about the RBS system, not everyone can get back in.
Watched the film, 'Wall Street. Money never sleeps' last night and it was good, a thinly veiled account of what happened in the Wall Street in 2008. I get the feeling that insiders would make the connections with Lehmans.

[Stanley]

See this LINK for the latest fines on a group of banks including RBS. Other banks, including HSBC are still contesting their cases. Barclays escaped because they blew the whistle!
Look at it how you will, this is appalling conduct and illustrates how widespread manipulation of interest rates was. Is your money safe in their hands!

[PanBiker]

Now here is one that beggars belief.

We bank with the Yorkshire and have a number of different accounts with them, various deposit a current account and a couple of instant access for the hole in the wall.

We have a Co-op credit card but no bank account with them as there is not a local branch anywhere near us. We use the credit card for larger purchases and the weekly shopping and stuff like that. We have always paid off the full balance of anything put on the card at the end of each billing period. Sally normally pays it at the Yorkshire with slip from the bottom of the statement.

For the first time ever we have misplaced the statement, looked in all the usual places to no avail so Sally rang the Co-op Visa folk and asked for a replacement (she likes to cross check the items before payment). She was told that a replacement statement would cost £5.00 so she just asked for the current balance and was given it,along with the account details (ID, number and sort code etc) for her to pass to the Yorkshire for payment of the outstanding balance.

Off to the Yorkshire who tell her that they can't process the payment despite having all the same details as on the remittance advice! We have funds in our accounts to cover the debt but apparently they can't process it on a verbal request. We have the name of the bank and full account details and sort codes, money in our account but the bank can't do what effectively is a simple transfer of funds!

Back onto the Co-op who still insist that the Yorkshire should accept the payment. To save flogging a dead horse further, Sally elects to pay it over the phone with our debit card. Guess what, they can't take payments for accounts over the phone! After pleading her case for about 10 minutes and being passed from pillar to post she eventually ends up with some operator who's desk was authorised to make an exception and process the payment. Honestly, you could not make this up, no wonder the bloody banks are in the state they are in.

[Tizer]

You and Sally have our sympathy, Ian, we're all too familiar with this type of incompetence in the banks and elsewhere. It seems to have become rampant in our organisations and institutions, both public and private. I think a lot of it is the result of trying to rely on computers with the unintended consequence of making staff unable to take responsibility for decisions and errors. They are following scripts written by people in the ivory towers back on Planet Bank who don't understand humans here on Planet Earth.

We've just managed to finally (at least I hope it's final) resolve a problem with UPS couriers. I mentioned some weeks ago that they sent us a red bill accusing us of not paying for a service, yet we haven't used them for years, no longer have a business and cancelled our account with them years ago. Yet the new bill was sent to us on the old account number. We wrote to head office and complained and eventually received what at first we thought was another bill but turned out after careful interpretation to be a credit of the same amount back to our non-existent account. We took this to mean they had effectively cancelled the bill. No letter, no apology, no explanation. Guess what...you know what's coming next! A short while after, we did receive another bill - same amount etc etc. So we wrote again. Now we have received a letter finally confirming that our account is closed, admitting that the amount should have been a charge on someone else's account, and ending with something like "Please note that this in no way detracts from our usual efficient service". What arrogance!

[Stanley]

These evidences of incompetence are so common now they have very little impact. This in itself is a measure of how bad what is laughingly called 'Customer Service' has become.
Ian and Sally's experience reminds me of the time when eldest daughter Margaret in Perth, WA found that she had been charged monthly for a service charge on a redundant account at Barclays and owed over £300. I went round with a letter from her asking that I should be allowed to pay off the balance and that the account should be closed. They refused both options saying she had to go to a branch personally and sign 'official' forms. After a long and heated argument I persuaded them that a written instruction from a client 10,000 miles away was a legal document and that anyone could pay money into her account if they had the correct details. The next line of defence was that they couldn't disclose details of her account to me so I could write a cheque. So eventually I gave them a blank signed cheque and told them to insert the amount. They agreed to this and when they had filled in the amount I asked them what it was for my counterfoil. Surprisingly they immediately told me. It took six weeks for them to confirm in writing that the balance was paid and the account terminated. The last part of the argument took place at the counter in front of a queue of waiting customers who were being held up by all this. I apologised to them all and told them to take note that this was what their bank could do to them. I think they thought I was deranged but at least I had warned them!

[Tizer]

One major and lasting effect of the incompetence is the image stored in the customer's memory. I still remember my first bad treatment by a bank, TSB, which was in the 1960s and it's still etched in my memory. I'd just started my first term as an undergraduate and was lucky enough to have a grant from the local council (because I'd worked for about 5 years and therefore qualified for one). It was to be paid at the beginning of each term into a bank account and this is when I started my first account. It was critical because I had to pay my rent weekly, as well needing money for food, books, equipment etc and I had no other source of cash - my parents couldn't afford to fund me and I hadn't earned enough to save any money. But each time I went into the TSB they said they hadn't received any money for me. I contacted the council and they insisted they'd sent the money to the bank. This went on and on and I was having to borrow money from my new friends to get by. After much argument and many visits to the bank, the TSB finally admitted that it had found the money - they had been directing it into a `holding account' by mistake. But it took them about 6 weeks to discover this!

[plaques]

Another unbelievable episode. A close friend called in the Yorkshire Bank to set up a new bond for himself and his wife.
No problem they transferred the money from his current account into the bond which they both signed.
Asked for any further business. "Yes I would like to cash an existing bond into my account".
"We can't do that without some identity from both of you". They don't have a passport. driving licence or paper utility bills.
After much ranting, expletives, and arm waving, it took the intervention of the MP to get their money.

[Stanley]

My handicap is that I can remember the church-like atmosphere in Lloyd’s Bank, Underbank, Stockport in the 1940s. It was in a half-timbered building and everything was of course done with pen and paper and entries made in enormous ledgers. It was impossible to imagine mistakes being made. If I remember right, all the cheques paid out by you were returned to you each month duly cancelled with a statement which was in black for credit and red for debit. Of course it would never work today but I really do believe that in the effort to reduce the number of employees and take maximum advantage of computers the complicated systems they have set up demand rigid adherence to rules which often clash with the personal needs of the client. The only defence I have found with all automated accounts is to keep the transactions simple, don't do anything to attract attention and give them no opportunity of applying esoteric transaction rules. I know, that doesn't help....

News this morning that the 'Volcker Rule' has been applied to the banks in the US. (LINK) In effect this stops the banks from gambling with customer’s funds. What a good idea! Is Ossie listening?

[PanBiker]

You can't pay a guaranteed building society cheque into the Yorkshire without ID. The fact that you have a cheque and paying in book in your name and the corresponding guarantee card and are known by the teller makes no difference. Fell foul of this earlier in the year when trying a simple movement of funds.

[Tardis]

Lloyds fined £28million for creating a culture of mis-selling by rewarding staff to sell thousands of products to customers regardless of whether they needed them

[Tizer]

Here's another historical one, this time with Barclay's being the culprit. As we've trawled through decades of Mrs Tiz's father's stuff to see what could be thrown away (he kept everything!), in among a lot of unrelated documents we found correspondence from 1998 with the Salford branch of Barclay's and Salford council. Her dad's aunt in Salford had become unable to manage her affairs. Dad intervened and did his best to set up assistance for her, there being no other relatives to help - her daughter had broken off all contact with her years before ( we know not why). The council had had access to her Barclays account to pay for various services rendered. When she died (intestate) the council handed over some left over money to dad; no problem and it helped with the funeral etc. Barclays still held a few thousand pounds in her account and would it part with the money - no way! Dad paid the Salvation Army to trace the daughter, which they did successfully but she didn't want to have any contact with dad and so he still didn't know where the daughter had gone. Barclays didn't want to try and contact the daughter so dad argued that at the very least the bank should give the money to charity which is what the aunt would have wanted. But they hung on to it and his last letter to them accused the bank of wishing to hold the money in perpetuity. As far as we know they've still got it.

[Tizer]

Lloyds fined £28million for creating a culture of mis-selling by rewarding staff to sell thousands of products to customers regardless of whether they needed them

http://www.bbc.co.uk/news/business-25330366

[Stanley]

I heard an 'industry spokesman' say on Today this morning that the £28million fine on Lloyd's was 'peanuts'. He was objecting to Evan Davies saying it was a 'whopping fine'. I have news for that bloke! £28million is a whopping amount. The only reason these reports have been devalued of late is the massive scale of the other fines and penalties imposed recently. Two reports of British banks being penalised in 24 hours. How much worse can it get? Remember that investigations are ongoing into other matters and these will result in even more adverse reports. Consider what would happen to say and aero space company if they were caught out like this, or any other business for that matter. Am I alone in thinking that a climate of fear and dependency by government on the financial sector is protecting them from what, in any other case, would be the natural consequences of being caught like this. Note also that in the case of Lloyd's it was judged that this was a fault of the system do no individuals are named or penalised. Who instigated the system and what were their motives and ethics? That is the root of the problem and I will say again, people in handcuffs being led out of their offices will have much more effect than fines.

[Tizer]

Two reports of British banks being penalised in 24 hours. How much worse can it get?

RBS fined $100m by US for Iran sanctions violations (BBC)
Royal Bank of Scotland has been fined $100m (£61m, 73m euros) by US regulators for violating US sanctions against Iran, Sudan, Burma, and Cuba. The settlement follows from a 2010 internal investigation by RBS into its historical US dollar payment processes and controls. The violations took place between 2005-09, the US Treasury said. In a statement, RBS said it "acknowledges and deeply regrets these failings". RBS found that bank procedures removed location information on payments made to US financial institutions from countries such as Iran and Cuba. Bank procedures "instructed employees to list the actual name of the Iranian financial institution rather than the Bank Identifier Code in the beneficiary bank field of the payment instructions," according to regulators. This prevented information about the banks from being included in cover letters and forms sent to US clearing banks. Those institutions then processed the payments, in violation of US sanctions. Furthermore, according to the New York Division of Financial Services, RBS employees in the UK "received written instructions containing a step-by-step guide on how to create and route US dollar payment messages involving sanctioned entities through the United States to avoid detection". In total, more than 3,500 transactions, totalling approximately $523m, were routed through New York banks in violation of US sanctions.
http://www.bbc.co.uk/news/business-25341882

[plaques]

I like the comment by Robert Peston BBC last night. "Given a new set of guide lines or rules the bank's first thought is 'how do I get round them'" I think this sums up the banks mind set completely.

[Tardis]

The ex-finacial ceo of Bradford and Bingley was today fined £30k according to the FT

[Stanley]

I read my Private Eye yesterday and despair when I note the number of 'usual suspects' from the banks who are now 'advising' the government or even in charge of bank regulation. The revolving door has a lot to answer for. You get the impression that the higher echelons are a sink of incestuous back scratching where they are all looking after each other.
On MPs pay, the chairman of the independent committee, pedalling hard on yet another TV interview said that MP's pay had fallen behind and needed to be brought back into line. You could say the same thing about household incomes....
That egregious woman Angela Knight is back in my life again. It was bad enough when she was fire walling for the bankers but now she has another indefensible row to hoe, defending the major energy suppliers as Chair of Energy UK, the trade association for the energy companies. Does she actually believe that what she is doing is ethical? Or is it just another highly paid firewall role....

[Tripps]

I share your fascination for this woman. There was talk of a life peerage for her last year, but mercifully it didn't happen. I am quite sure she would work for Greenpeace if the remuneration package was right.

[Stanley]

Quite David! There has been another example of this. I had a lot of time for Stephanie Flanders when she was economic correspondent for the BBC but now I see that she has left the Beeb and taken the post of chief market strategist at J P Morgan Asset Management where her new role is to big up the 'economic revival' and encourage investors. Remember that last month JPM were fined £13billion for selling toxic mortgage debt during the boom years. Could it be that they need some serious boosting of optimism? She is reported to have a salary of £400,000 in her new role. Good to have a well-lubricated scale of values when an offer like that comes up! Ethics? Forget it, go for the money!

[Stanley]

An advert on TV caught my eye last night. The 'Provident' dates back 135 years and there are many instances in the LTP of people using the services of the Provident Man to enable them to buy clothing for the family. The advert was for the 'One Card' issued by Provident, pre-loaded with £200 and an APR of about 400%. It flags up yet one more aspect of the 'Two Nations', Credit for the poor is far more expensive than for the rich. Never included but definitely part of the cost of living.

[Stanley]

Heard a lady from the Small Business Federation bigging up the prospects for the Xmas shopping spend this year. She said one of the main reasons was cheap credit. Tell that to the people trapped in high interest alternative cards and pay day loans. The whole world seems to be running on unsustainable credit!