BIG BROTHER IS WATCHING; Banks can't take you for a ride.
BANKS are about to come under the kind of scrutiny that drove Anthea Turner to tears in Celebrity Big Brother.
They've already been accused of using loopholes in the banking code to deny customers their rights.
And of failing to tell millions of savers they could earn more by switching accounts.
Now the Treasury has set up a Big Brother to watch every move banks make.
The new banking code review group promises to name and shame any of 140 banks and building societies guilty of "uncompetitive practices".
Standards Board chief executive Seymour Fortescue warned: "We already have disciplinary action in hand."
Banks continually introduce new accounts with improved interest rates in a bid to attract customers, but existing ones don't always benefit.
The Consumer Association's Which? magazine recently outed banks with poor records.
Bank of Scotland's Premier Bonus, Britannia's Flexible Savings Cashcard and the Woolwich Premier Instant paid above average rates in 1998, but dropped below average.
Alliance and Leicester's Access and Access Plus accounts fell from 2.8 per cent and 3.23 per cent in January 1998 to 0.25 per cent and 1.1 per cent by August 1999.
Even the Abbey is getting the habit. It has brought in three easy-access accounts since October 1999, each paying better rates than its Instant Saver account. Rates in itsDirect Saver and Postal Direct dropped a month after Abbey launched its internet account, e-Saver, last September.
The code says banks should automatically transfer customers to higher-yield savings accounts or at least notify them of more favourable rates of interest.
All the banks named by the campaign claim they are already doing this, but the Consumer Association said: "Some accounts were competitive when launched but quickly fell away."
The latest, most damaging attack on the big banks has come from an unexpected source - another bank.
Fleming Premier Banking says fellow banks are guilty of "flouting the rules" of the banking code.
Their commercial director Paul Medlicott said: "Banks launch new accounts paying better rates to attract new customers.
"But they don't want to switch their exisiting customers because that could take millions off their bottom line.."
The Bank of Scotland said: "We introduced a competitive interest rate guarantee for our major branch accounts in 1997. We promise interest rate customers receive is better than the High Street average."
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|Publication:||Sunday Mail (Glasgow, Scotland)|
|Date:||Apr 15, 2001|
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