OFT test case

[Castlebest]

Northern Rock are looking good anyone fancy buying some shares and bailing this half witted government out?

[JOSH_IOU]

with what?

[mailmannz]

Im just going to step out of line here for a second BUT I believe the impact on the economy would be far higher if Northern Rock was allowed to fail.

 

In my opinion, NR should be nationalised (and maybe renamed "The Peoples Bank" ) since the Government is dumping in billions of pounds anyway.

 

Mailman

[Justforfun]

Northern Rock are looking good anyone fancy buying some shares and bailing this half witted government out?

 

Mmmm let me think about that... i would rather walk around my street naked with a cactus inserted up my butt wearing a pair of flippers and a snorkel ..

[dave]

Im just going to step out of line here for a second BUT I believe the impact on the economy would be far higher if Northern Rock was allowed to fail.

 

In my opinion, NR should be nationalised (and maybe renamed "The Peoples Bank" ) since the Government is dumping in billions of pounds anyway.

 

Mailman

 

I agree with nationalising it, but I don't understand why it would effect the economy more than dumping huge amounts of tax coffers into it, rather than letting it fail.

 

I'm not being argumentative, I honestly just don't understand why it would have that big an effect on our economy.

[Justforfun]

Treasury Backs Private Rescue For Rock

 

Updated:15:16, Monday January 21, 2008

A private rescue of Northern Rock has been backed by the Government - but it has admitted that taxpayers will be responsible for its debts for years to come.

 

Queue outside Northern Rock branch

 

The Treasury has confirmed plans to sell Government-guaranteed bonds to pay off the £24bn-plus the crisis-hit lender is said to owe.

This is the amount the Bank of England is reported to have lent Northern Rock so far after the bank got into difficulties last autumn and savers queued up to withdraw their cash.

But the Treasury has insisted the funding would depend on a "robust and acceptable" business plan and taxpayer guarantees, it has added.

Northern Rock will be taken into "temporary public ownership" if a private sector solution cannot be agreed, it said.

The new funding plans backing a private sector rescue of the mortgage lender was made in an announcement to the Stock Exchange - Northern Rock's shares gained strongly on the news.

It includes plans for taxpayers to share in any gains made by a private buyer.

Billions of pounds borrowed by Northern Rock will also be converted into bonds backed by the Government under a financing package that increases the prospect of a private sector takeover of the ailing bank.

The announcement came as Chancellor Alistair Darling prepares to make a statement later, amid reports Sir Richard Branson is preparing an improved offer for the bank.

The bond scheme has been drawn up by the Treasury's financial advisers, investment bank Goldman Sachs.

 

The Treasury had originally hoped that private sector bidders would be able to pay off up to £15bn of the lender's Bank of England debts up front, but would-be rescuers have struggled to raise financing following the credit crunch.

The proposals would see the Newcastle-based lender selling a pool of its mortgages to a financing company, which would sell the Government-backed bonds in money markets.

Northern Rock will pay the arrangement fees and expenses for the new funding plans, although the Treasury reserves the right to withdraw and examine other proposals if necessary.

Three private sector teams are vying to salvage Northern Rock - a consortium led by Sir Richard's Virgin, investment group Olivant, and the Newcastle-based firm's own management.

They will have until February 4 to submit their proposals, the Treasury added.

Sir Richard, who is with Gordon Brown on his official visit to China and India, has claimed he is in pole position in the takeover battle.

However, Olivant's plans are widely seen as the shareholder's favourite as they would not involve a takeover or break up of Northern Rock.

Instead, Olivant would parachute in a new management team in return for an equity stake. It has told Sky News it is "confident" of taking control.

Any successful bidder will need the approval of the bank's investors.

Northern Rock said it "welcomed" the Government's preference for a private sector rescue.

It added: "A private sector solution is also the board's objective as being in the best interests of its shareholders and other stakeholders."

 

 

 

( I agree with Dave, and why should we keep footing the bill for their f _ _k ups)

[nobodys fool]

Banks also make cash from current accounts due to what are called "interchange fees" charging the businesses you buy from for processing the transaction.

Therefore they will not want to discourage people from holding accounts, thus reducing this very profitable income stream.

 

However, how banks try to make additional profits to make up for the loss of penalty charges is irrelevant to the illegality of these charges, its scare mongering to try to get those worried about paying account fees to support the illegal position.

 

Given that banks have known that penalty charges were exceptionally questionable legally for a number of years, continuing to take them could actually be construed as theft (not that the police would prosecute).

[mailmannz]

with what?

 

 

All the money you get back from your unlawful fees challenges?

 

Mailman

[JOSH_IOU]

Why would i want to invest it into a bank?

[mailmannz]

So you can make some moolah off the back of us mere mortals!

 

Mailman

[JOSH_IOU]

Then why don't you invest in gold?

[Son of Shoestring]

Then why don't you invest in gold?

 

Try buying some in any quantity...

 

Annual demand outstrips annual supply significantly with the largest bulk going to the jewelry market in India - not to mention the souks of the Gulf region. The shortfall is reduced by the black market. The back market is to all intents and purposes the major gold mining companies who avoid paying tax on the under the table quantities they mine. It is a secret shared by everyone - governments included.

 

Historically, the price of the shiny metal was "fixed" by governments and the gold banks to keep the price pegged to a level that suited them. The fact is that gold is not quite as rare as it is made out. Ditto diamonds. The latter are as common as muck, in fact, but the global market is completely controlled by De Beers. The same people who control the "sparkly" also actually control (through nominees and catspaws) the gold and precious metals markets.

[JOSH_IOU]

I never actually said buy it i said invest in gold.

[Son of Shoestring]

Im just going to step out of line here for a second BUT I believe the impact on the economy would be far higher if Northern Rock was allowed to fail.

Mailman

 

The problem, which the Bank of England Chairman described as a "moral hazard", is the state rescuing a privately owned for profit business because its collapse, through mismanagement, could result in a financial "domino effect".

 

The major banks know that governments will always bail them out in extremis, because the after-effect of not doing so causes the public impression that the international economy is not as robust as it is made out to be (it's very fragile in fact). This impression is problematic as if it becomes generally known that a major bank failure will always have the taxpayer bail it out, then the poor taxpayer will begin to howl about the need for strong state regulation t ensure that management do not act just for the greed of their shareholders and their own greed, but for the public good.

 

Since any sort of regulation - other than the very lightest touch - is anathema to today's political (and business) elite, the result is that you and I will always have our pockets picked to support the truly wealthy and to "pay the starving of the [political] parties" in order to ensure they [the "parties"] pledge their continuing support for big business (who can do no wrong).

 

In any dictionary you can to name such activity is defined as "bribery and corruption".

 

Welcome to the myth of democracy.

[JOSH_IOU]

If Northern Rock is nationalised I am taking my £20 out of my savings account

[car2403]

Anyone have any information on the OFT test case?

[Guest vortex]

Yes, it is still going on and here is some news

BBC NEWS | Business | Overdraft fees 'core' to banking

[Alphageek]

The barrister told the judge hearing the case, Mr Justice Andrew Smith, that the average Royal Bank of Scotland customer went overdrawn without permission three times a year.

I thought 80%+ of people never incurred charges. So how can the average RBS customer go overdrawn without permission three time a year?

 

Should we ask Ms Knight?

He said providing such customers with unarranged credit was a "substantial and valuable service", which was central to everyday banking.

Without it, he argued, customers would not be able to draw on cheques until six days after they had been paid it to allow them to clear.

 

And if the possibility of unarranged borrowing did not exist, then debit card payments could not be guaranteed by banks.

Retailers would be forced to phone banks to check every transaction before allowing them to be processed.

LOL - this is the 21st century isn't it? Shows you how out of touch some of these QCs are.

[Justforfun]

The banks aint so clever now watch the video

 

BBC NEWS | Business | Global shares tumble on US fears

[srfrench]

Oh Boy!.........what a gas!........I remember in the not so distant past trying to pay a number of DD's and STO's out that were refused both without the O/D facility and with an O/D facility on my accounts and was charged in both cases even though it didn't get authorised or paid out!!!!!!

 

Basically RBS is not in full knowledge of the facts or are knowingly telling porkies.

 

It's made me want to fly to London to give the OFT's barrister and/or the Judge proof that what the RBS Barrister has just spouted is in fact inaccurate and not true!!!!

[Alphageek]

It would seem RBS's QC is not in possession of the full facts.

[Bookworm]

Well, if this is the best he can do, which is trying to cloak the penalty by trying to pass it off as a service, one should hope the judge will see right through it.

 

Of course, you realise that what they're trying to do on a grander scale is what Natwest did with the one success they had in court in Henry v Natwest. I find quite heartening that after a couple of years and millions spent in trying to find the best way to make it all go away, this is the best they can come up with.

[JonCris]

Make no mistake the banks really do consider your money as their money - This was no more evident when the Northern Rock run started.

 

They spoke to customers as if they where doing THEM a favour by letting them have their money. One manager even called the police when a customer demanded payment of £1,000.000 (yes one million) & the manager refused & the customer said they wouldn't leave the bank without it - she then had the unmitigated gall to phone the police

[nobodys fool]

Its just a shame I can't find the letters from several years ago where a bank threatened to close my account due to failing to comply with the account terms of use (exceeding the overdraft a couple of times).

 

In many cases the banks systems are still stuck in the 70s... even in branches they'll tell you the wrong available balances because uncleared items are on another system...

In this day and age realtime electronic balance confirmation and funds checking shouldn't be an issue.

The failure to get these systems to work properly or to update them in line with technological advances could be seen as negligent... but of course it gives the banks an excuse to charge and milk customers.

[Justforfun]

are we going to see more of Angela Knight or is it going to be a case of good knight, i know i'm going to be hounded for this but i really hope that the shares sink lower and lower and lower just to learn banking industry and fat cats a lesson they will never forget, and also learn the higher class that no one is indestructable, stuff each and every one of them i say, they have robbed from us so now let's see them suffer.