FSA Figures Reveal Huge Surge in Bank Complaints
Consumer Protection, Other
The Guardian reports that according to the Financial Services Authority (FSA), Barclays was the bank with the greatest number of complaints in the second half of 2011. Reportedly, the 281,000 complaints made by Barclays customers was an increase of 30,000 from the first half of the year. However, Barclays chief executive of retail and business and banking Antony Jenkins opined that the bank is moving in the right direction after reducing complaints by 30 per cent from 2010 to 2011. According to The Guardian, other banks experienced similar surges in complaints, with Lloyds TSB receiving 241,000 complaints (up from 182,000 in the first half of the year) and MBNA receiving 121,000 complaints (up from 71,000 in the first half of 2011). MBNA reportedly attributed the rise in consumer dissatisfaction to payment protection insurance (PPI), stating that “[t]he primary driver is PPI and we find that that is being inflated by aggressive claims management companies”. The Guardian also reports that “[t]he overall figures show that complaints about “advising, selling and arranging” increased by 69 [per cent] to 1,093,684, with 92 [per cent] of these about general insurance and pure protection products”.
The Guardian: Barclays tops FSA complaints list (28 March 2012)
(Source: The Guardian)
Competition Act Consultation
The United Kingdom Office of Fair Trading (OFT) has made available Consultation Document: Review of the OFT’s investigation procedures in competition cases (March 2012) for public comment. The consultation document seeks views on the OFT’s proposal to introduce a new structure for the way it makes decisions during investigations under the Competition Act 1998 (the Competition Act) and to publish revised guidance on the conduct of investigations.
The OFT also announced that the “trial of a Procedural Adjudicator role … with an expanded remit, and a number of other significant enhancements it is making to its [Competition Act] investigation processes”, has been extended for a further year.
Comments on the consultation document should be sent to the OFT by 19 June 2012.
Further information from the OFT
OFT’s media release (28 March 2012)
(Source: OFT; Legislation UK)
EC Takes Action on Roaming Charges
Competition, Consumer Protection
The European Commission (EC) has announced that it will introduce new rules to limit mobile telephone companies’ roaming charges. The EC stated that the rules “will create more competition in the roaming market” and will provide “safeguard limits on consumer prices”. EC Vice-President for the digital agenda Neelie Kroes stated that “[c]onsumers are fed up with being ripped off by high roaming charges. The new roaming deal gives us a long-term structural solution, with lower prices, more choice and a new smart approach for data and Internet browsing”.
Further information from the EC
EC’s media release (28 March 2012)
Related news item:
BBC News: EU acts to end ‘rip off’ roaming charges (28 March 2012)
(Source: EC; BBC News)
Police Payments Charitable, Company Claims
Anti-Bribery and Anti-Corruption, Business Ethics and Corporate Culture, Confidentiality and Intellectual Property
The Age reports that satellite television encryption technology company News Datacom System (NDS), a former subsidiary of News Corp, has had to defend itself from claims that payments to Surrey Police for “unspecified work” were in exchange for assistance in accessing rival companies’ encryption codes. Reportedly, a NDS statement confirmed that the company had made a “one-off charitable donation of £2,000 to Surrey police in August 2000″. However, according to The Australian, the NDS statement also clarified that “[t]hese allegations, instigated by our competitors, [have] been investigated by the United States Department of Justice, a federal court jury, a federal trial court, and a federal appellate court who have all rejected allegations that NDS was responsible for TV piracy or that NDS distributed codes that facilitated that piracy”.
The Australian: NDS slams ‘piracy’ claims (29 March 2012)
The Age: News Corp subsidiary paid British police for ‘assistance’ (30 March 2012)
(Source: The Age; The Australian)
OFT’s Mental Capacity Guidance for Creditors
Business Ethics and Corporate Culture, Consumer Protection
The UK Office of Fair Trading (OFT) has made available Summary of responses to the consultation on ‘Mental Capacity – OFT guidance for creditors’ (March 2012), which aims to provide clarity to creditors on borrowers’ mental capacity in relation to responsible lending and borrowing decisions.
The guidance outlines the steps for creditors to:
- “[identify] borrowers who might have mental capacity limitations”;
- “[assist] … customers to be able to understand explanations of credit agreements to enable them to make informed borrowing decisions”;
- “[reduce] the risk of such consumers being granted unaffordable or clearly unsuitable credit”;
- “[provide] borrowers with clear information and explanations about credit agreements and any associated risks”;
- “[give customers] adequate time to weigh up the information and explanations provided in order to better enable them to reach responsible lending decisions”; and
- “[carry] out sufficiently stringent assessments of their ability to afford to meet repayments in a sustainable manner”.
Further information from the OFT