Prime time - Banks Overcharging

S

SteelBlue05

Guest
Is there no thread on the findings of the Prime Time Investigates program from last night?

I just logged in hoping to find some good debate about it and havnt found any thread, am I missing it or are we all just used to over charging these days and kind of apathetic to it all?
 
AIB in particular seemed to have been overcharging customers with "Management Fees". The program showed anonymous interviews with ex AIB managers who claimed the culture in AIB forced managers to over charge customers so as to keep profits high.

They suggested that the "management fees" were arbitrarily increased on some customer accounts whom they thought "were under pressue" and wouldnt notice the increase and if the increase was questioned they would just pay back the money and put it down to a computer error.

They also showed some letters written by AIB employees claiming they were being bullied into selling the wrong products to customers just to get the sales.

It also showed some leaked internal reports listing AIB braches that had the most surcharges, showing a culture where high profits is the king, customer needs come second.
 
I saw the Prime Time program last night...it made me soooo mad! Plus the AIB Bank Managers attitude was an absolute disgrace, not a bit apologetic...That Bank Check company will do great out of the program, did anyone hear if they check personal accounts to, or is it just business accounts they deal with? As we know from the overcharges on the foreign exchange, it's the ordinary joe soap being ripped off as well!
 
I saw this and was totally enraged by the condescending attitude of the two bank officials (AIB & BOI) on the .... ' we will investigate anything brought to our attention' stance.

I wonder what the next steps are though... does the regulator have enough to go on here to investigate or are they going to wait until the former managers or whistleblowers come forward in confidence?

ninsaga
 
I have to say I'm not terribly surprised, having dealt with a number of cases of fraudulent over charging by financial institutions. I would think the most common over charging in the 80s and 90s was by hiking interest rates and then adding penalty interest when payments were missed. I have checked my bank statements fairly thoroughly since the first such case I encountered. As a private individual, I rarely found anything amiss. Since I opened my own practice I am regularly being overcharged, point it out, get a refund, happens again next month. In my case there is nothing sinister going on, just a bank levering charges automatically even when there is an agreement not to do so. A computer/human error. But for many people in the 80s and early 90s, especially people in trouble financially, they were being systematically defrauded by their banks. It was interesting to hear one of the witnesses indicating that say for eg where an interest rate of 10% was agreed, the bank would actually charge 11 or 12% and get away with it. I do sympathise with the officials involved who felt under pressure to do this, I have heard of more than one bank employee having a nervous breakdown due to the pressures involved. Obviously it doesnt excuse it, but ultimately I hope that they do not carry the entire responsibility as the orders came from the top, not the branch levels.
 
I found it very sinister. Some of the antics they described left me in no doubt that there was a sinister corporate culture of overcharging which was based on pure greed. It's probably still the case. The statistics shocked me - nearly half of people who have reason to query their accounts are refunded. Think about all the people who don't query their charges and you have a very high number of people. That suggests systematic overcharging to me. There are *no penalities* there at the moment for this sort of ongoing 'error'.

Bank people definitely need to go to jail over this but I imagine it's difficult to prove who pulled the strings.
 
Vanilla said
...many people in the 80s and early 90s...were being systematically defrauded by their banks...
Click to expand...
...Since I opened my own practice I am regularly being overcharged, point it out, get a refund, happens again next month...
Click to expand...
...In my case there is nothing sinister going on...
Click to expand...

Not to put too fine a point on it, but...

Eh! Hello?

What would you call systematic?
What would you call sinister?
Do you really think that it is normal to have to "point it out"?
Do you pay (the bank) for this service?
:eek:
 
Recently Mr Mac (my other half) received a current account statement from AIB with a debit of euro 25.39 re.facility fee. The account is in joint names but the correspondence was addressed to him.

We could not figure out what the fee was for as we have money on deposit with the bank so he rang them and asked what's the reason.

He was told that he took out an overdraft facility years ago on the account and although it was never availed of there was a charge for it.

He was asked to put in writing that he wished to cancel the facility so he asked for an email address so he could cancel immediately and there was quite a long pause before the bank personnell came back to him with a contact address.

My point is if we had not noticed it they would be just taking the money out of the account.
 
Overdraft facility fees are standard charges. You were only overcharged in this case if (a) you didn't request the facility (whether you used it or not is irrelevant); or (b) the bank continued to charge you after you had requested to cancel the overdraft; or (c) the bank charged you more than the agreed rate (I don't see any evidence of this).

Your point that that they would have continued taking the money.......so what? Go back and read the original overdraft agreement that you signed.

This has nothing to do with the instances of overcharging/rip-offs/misselling that previous posters have mentioned. In those cases the banks most definitely appear to have done soemthing wrong. In the case of charging the correct fee for something that was requested, they most definitely have not.
 
What I said is that in my case there is nothing sinister going on, and that is the case. I have an agreement that I am not to be charged bank charges at all by my bank. This agreement is with the local branch. Unfortunately bank charges regularly appear on the accounts in instances such as electronic transfers of funds etc. This is because it is automated.
 
Vanilla said:
This is because it is automated
Click to expand...
I'm not getting at you but surely if they can automate charges, they should be able to automate refunds or "un-automate" the charges if the first place.
From what you said it seems that they only refund if and when YOU bring it to their attention.
You are not overcharged because you take action but if you didn't act the systematic overcharging would happen.:confused:
 
While I don't like banks myself I feel it necessary to remind everyone that banks are... at the end of the day.... businesses... AIB is Allied Irish Banks Plc. Their primary goal is profit.
 
CCOVICH said:
Overdraft facility fees are standard charges. You were only overcharged in this case if (a) you didn't request the facility (whether you used it or not is irrelevant); or (b) the bank continued to charge you after you had requested to cancel the overdraft; or (c) the bank charged you more than the agreed rate (I don't see any evidence of this).

Your point that that they would have continued taking the money.......so what? Go back and read the original overdraft agreement that you signed.

This has nothing to do with the instances of overcharging/rip-offs/misselling that previous posters have mentioned. In those cases the banks most definitely appear to have done soemthing wrong. In the case of charging the correct fee for something that was requested, they most definitely have not.
Click to expand...


Sorry I spoke.
 
While I don't like banks myself I feel it necessary to remind everyone that banks are... at the end of the day.... businesses... AIB is Allied Irish Banks Plc. Their primary goal is profit.
Click to expand...

Agreed, however that does not entitle them to defraud their customers. If the fees and interest rate is agreed upfront, that's fine, however the Prime Time programme exposed practices of charging over and above agreed fees and interest rates.
 
The woman who kept getting over charged and when she pointed it out they would say it was a computer error and pay her back had a great quote "How come the computer only errored in favour of the bank!"

If these computers were so badly programmed we should all be millionaires!!!
 
AIB and the Moral Hazard of Corporate Greed

Are we seeing the further unmasking of what amounts to rampant corporate greed where standards of corporate social responsibility have plummeted to a new low ?

Banks are a protected sector in the economy. They are protected because of their importance. Yet this very protection gives rise to risks of moral hazard behaviours.

Are we not seeing in the AIB case this at work ? Is the hazard in play a culture of greed that has intimidated stakeholders over the past 30 years of sagas beginning with the ICC collapse, DIRT, Rusnak, Feldor, Foreign Exchange and lately manifesting itself in the Prime Time revelations of systemic fees and interest rip off practices...which according to AIB are forgiveable because they were "technical issues" and anyway happened in the past.

At what stage does the Government step in and what responsibilities has it got to protect it’s citizens (bank customers) from such behaviour ? IFSRA has been largely silent …or has it within a short time become captive of the very forces it is trying to manage? Could it be that the cultural bias of prudential supervision is winning out ? Can the IFSRA Consumer Panel ensure a consumer counterbalance ?

Being too big to fail begets a higher potential for corporate misbehaviour. Perhaps it is a fact of life that until the share price reflects a measure of corporate responsibility then such behaviour will continue. The one thing that could effect investor sentiment is the potential for loss of business as customers vote with their feet and leave in disgust at the way in which they are being treated. What chance of this if they believe that "they are all the same" ?

Riddler
[/quote]__________________

Ever hear of the practice of shadow permissioning...this is where the bank agreed with their customer an overdraft of say 10,000 and also provided a shadow limit of an additional say 5,000 without telling the customer ...so there you are with cheques being willingly paid in excess of your agreed overdraft and all the while the bank was charging cheque payment fees and overdraft surcharge interest on what were termed unauthorised overdrafts...this practice went on for years as did the practice of delayed renewals on overdrafts where the overdraft would revert to nil and the poor customer would incur surcharge interest until the bank arranged to renew the overdraft for a further year...

Riddler
 
In fairness, you should monitor your account so that you don't exceed the agreed limit, this is something that I am always very cautious about (as far as I am concerned, this is my responsibility and not the bank's), as I'm pretty sure that the consequences would be fairly severe (surcharges, penalty interest etc).
 
i didn't know you could get an overdraft at 10,000 euro. it does seem a bit high. i guess that would be for business customers though?

Alex.
 
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