BBB - Brian Bollen's Blog

Modern Banks and the Art of Gross Impertinence

I have just had the most extraordinary phone call from someone purporting to be a representative of my bank (Tracey, I think she said, in Milton Keynes). Without being unduly superficial, I have to say that she sounded like a Tracey.

In effect, she wanted to know what I plan to do with some money that is coming into my account. I told her in no uncertain terms that I found the question grossly impertinent, and that it is no business of hers, or her colleagues elsewhere, what my financial plans are. I can only imagine what the reaction would be if I were to telephone her back and ask her what SHE plans to do with the proceeds of her next salary payment. I would be told, in no uncertain terms, to mind my own business. Why should it be any different the other way around? Why do banks assume, because they act as temporary custodians of one's cash, assume a proprietorial attitude towards it? I find it grossly offensive that they act in this way. I know it's not an isolated incident; another bank did exactly the same when my daughter had a sum paid into her account recently.

Data protection? Client confidentiality? Banks cite these as unassailable reasons not to tell you about your own affairs when it suits them, but ride roughshod over them when it suits them. Apart from any other consideration, how can I be certain that Tracey was indeed who she claimed to be? And finally, to rub salt into the wound, as I am currently overseas, and Tracey called me on my UK mobile, it cost me good money to be outraged...

Gordon Brown's Labour: Five More Years

I was a natural Conservative for a long time, despite my origins on what might today be classes as a sink estate in central Scotland. After the overthrow of Prime Minister Margaret Thatcher, found guilty by her party of having won three successive general elections, I downgraded to conservative. Today, I don't have a Clue. Politics turns me off, as the realisation grows that whoever is in charge at the top, it makes little or no difference to 'ordinary people'. Would you prefer to be screwed by someone wearing a blue rosette, a red one or an orange one? See what I mean?

Maybe this lack of partisanship, and a preference for pragmatism over principle, enable me to see things more objectively than those involved in the cut and thrust of politics, whether as practitioners or observers. Whatever the reason, it is by no means clear to me that the General Election of June 2010 will signal the departure of the current Prime Minister, Gordon Brown, from the scene. Sure, after more than 12 years a country would tire of any Government, but especially one run in such a bungling, self-serving criminal manner (I'm thinking of war crimes and financial crimes here). And there is no doubt the country is tired of Gordon Brown and his nonentical cronies. But do you sense any great appetite for the alternative?

Do David Cameron and George Osborne not make your flesh creep? I'm afraid we know how the Conservative and Unionist Party reacts in a recession. Slash public spending. Drive up interest rates. Throw millions of people out of work and out of their houses. All will be sacrificed on the altar of monetary purity. You don't believe me? Look at history. Look at the recessions of the early 1980s and the early 1990s. Do you want a repeat? If it isn't hurting, it isn't working, said former Chancellor Norman Lamont at one point. Quickly followed by: My wife heard me singing in the bath this morning.

No, I think the most likely scenario is the one that unfolded around John Major. Battered, bruised and bewildered, he somehow still limped to a majority of 21 in the 1992 General Election, which death and other causes of by-elections nibbled away at over the following five years. Under a charismatic leader, say Charles Kennedy, even with a drink or two him in streets ahead of any of his party colleagues, the Liberal Democrats might at last achieve their long-dreamed for hung parliament. But not with a man in charge whom most of us would struggle to pick out in an identity parade. 

I believe we are in for five more years of Gordon Brown, whose period in office so far reminds me very much of the progress of a clown's car round a circus ring, with doors and wheels and mirrors falling off, horns blaring randomly, the driver clearly out of control. He has only one clear goal: to enmesh as many of the inhabitants of the UK as possible in the web of the state, making it impossible for them to vote for any other party.

Whoever gets in, though, times will be tough. Here are some of my predictions. VAT at 25%. VAT on everything, no more exemptions, including baby clothes and baby food. VAT to rise from its current lower rate on fuel. Doubling or tripling of so-called Air Passenger Duty (as well as the fiscal boost, it would stop the masses from travelling quite so much, something our 'betters' seem to loathe). Income tax up, except, of course, for higher earners. Stamp duty on house sales/purchases to be raised. Pension tax relief to go the way of mortgage tax relief.

In recent years, the UK Government has destroyed the education system and the pensions system and is well on its way to destroying the housing system and the Armed Forces. We can only wish that it would do the same for itself.

Mandelson For Prime Minister: One Step Closer?

Returning to an earlier theme about the possibility of Peter Mandelson might enter 10 Downing Street as the bona fide key holder rather than a welcome guest, I was intrigued by the change of the law that has taken place to enable life peers to resign their peerage, and enter the House of Commons. Whatever can the good Lord have meant by that? Older readers will remember that Alec Douglas-Home resigned his peerage (a real one, not a life one) after becoming Prime Minister in October 1963, and won a by-election in Kinross (the constituency more fully known as Kinross and Western Perthshire was abolished in 1983). Which poor Labour MP, I wonder, might be required to make the ultimate sacrifice, and lay down his expenses claims for the greater good? Suggestions on a postcard please...

More Power To The Bank of England's Elbow? When it can't tell you how long it takes to clear a cheque?

Letter to the Financial Times, July 21, 2009

Dear Sir,

I have been reading with some amusement, occasionally turning to bemusement, about the proposals to change the role of the Bank of England. I personally believe that it was philosophically right to give the Bank independence on setting interest rates, even if in practice that independence has gone in all but name as the current UK Prime Minister tries to be Chancellor of the Exchequer, Bank Governor and Foreign Secretary as well as fill his principal role.

I am alarmed, though, by Mr George Osborne's proposal to award virtually all responsibility for financial supervision back to the Bank of England. I have no real principled objection to the proposal, only a purely practical one.

The last time I spoke to anyone at the Bank of England, an exceedingly rare occurrence in nearly 25 years as a financial journalist, not one member of the staff there could tell me how long it takes to clear a cheque.

If it can't handle the complexities of one of the most basic banking operations, how can it be expected to carry out the multi-faceted role that Mr Osborne envisages for it?

Just a thought.

Yours sincerely

Brian Bollen

Peter Mandelson for Prime Minister?

I'm not a gambling man myself, but earlier today (June 8 2009), out of a sense of curiosity, I asked a number of bookmakers for odds on Peter Mandelson taking over the role. 

The quote from PaddyPower, 20/1 against, looks surprisingly short to me, and I can't begin to think what kind of mischief a determined troublemaker might make with it. 

'Leading bookmaker opens book on Peter Mandelson succeeding Gordon Brown as UK Prime Minister' would make an interesting headline in any newspaper at the minute. Quickly followed by: 'The odds are shortening on Peter Mandelson moving into 10 Downing Street as the new Prime Minister'. Followed by: "The UK's leading bookmakers have stopped taking bets on whether Peter Mandelson will be the next Prime Minister; it is now being viewed almost as a certainty...'

I just thought I would pass this on; so that if such stories start popping all over the place in the next few days, I will at least be able to claim that I was one of those to latch on to the possibility. 

Incidentally, they are also quoting odds of 3/1 for the 2012 Olympics not to start on 27th July 2012. That seems VERY short to me. Do the good people at PaddyPower know something we don't???

Hazel Blears: Go Straight To Jail?

Forgive me please if I exhibit a lack of understanding of basic English law. But if Ms Hazel Blears, who performs some peripheral function in what passes for the UK Government, is planning to hand over a cheque for around £13,000 to Her Majesty's Customs & Revenue in respect of capital gains tax previously unpaid, is she not by definition making a very public admission that she evaded such tax in the first place? If so, she has committed a crime. Tax evasion, unlike tax avoidance, is illegal.

In which case, should not the police arrest her and interview her, and the Crown Prosecution Service begin building a case against her, and the governor of Holloway Prison begin preparing a cell? Somehow the thought of the personage who is increasingly known as Squirrel Nutkin sewing mailbags is strangely cheering.

And if an act that is illegal somehow falls within the rules of the Houses of Parliament, does that suggest that we have finally moved through the looking glass? Any last vestige of credibility that the so-called Mother of Parliaments had is finally gone. Hercules would have trouble finding a river deep and fast-flowing enough to clean out the UK branch of the Augean Stables!

Is The Royal Bank of Scotland Having A Liquidity Problem?

Is The Royal Bank of Scotland having a liquidity problem? The reason I ask is very simple. I asked it for my money back - all £57.77 of it - in the summer of last year, and I am still waiting, despite three further requests, the last of which was made last Friday (April 17 2009). I have still not received my money despite an assurance that the matter would be resolved.

The request dates back to the fraudulent removal of more than £3,000 from my RBS credit card last July. To give RBS credit, the matter was addressed and the money reinstated very very quickly. I instructed that the account be closed, and asked for the small credit balance to be returned. But I am still waiting. As a creditor who is also a taxpayer and a shareholder, I think I am being very shabbily treated.

Which is why I ask: is The Royal Bank of Scotland having a liquidity problem?

It is also demanding payment from my daughter of money that it says she owes on a credit card account that was closed several years ago, and which she insists she doesn't owe, but is considering paying just to get it off her back. Trouble is, they will not provide proof of the alleged debt unless she pays it £10 for duplicate statements, the originals of which she says she has never seen, so we are at something of a stalemate. Much of the supposed debt seems to comprise its arbitrary charges, late payment fees and over limit fees and such like, which could continue mounting ad infinitum.

'Customer services' staff have given her conflicting information, including an opinion that no, she doesn't owe the money, which was reversed just hours later with a statement that included the accusation that she was lying about a change of address some months ago. In mounting frustration, bordering on desperation, I contacted the press office, a maneouvre which journalists will report usually brings a satisfactory response. Not so far it hasn't. The press officer who returned my call discussed the matter with my daughter on Saturday afternoon, promised to look into it, and ring her at work first thing on Monday morning (April 20). Again, she is still waiting. And in the meantime, my active imagination has gone into hyperdrive.

Is The Royal Bank of Scotland so desperate for cash that it is resurrecting old accounts where it can claim in a manner that out-Kafkas Kafka that there is a debt, that it then retrospectively levies charges on, and demands settlement of, banking on the hope that people will cave in and pay money they do not in fact owe? If so, this is nothing less than state-sponsored extortion. But then, what do we realistically expect from a government that is planning to double the country's debt in just a few short years, whose representatives claim reimbursement for charges to watch adult entertainment and bathplugs, and whose police forces seem to regard themselves as much above the law as does their boss, the Home Secretary?

If any readers have had any similar problems with The Royal Bank of Scotland, do feel free to contact me on brianbollen@mac.com.

PS To give credit where credit's due - something of a rarity during the recent banking crisis - RBS did eventually return my money and waived the amounts they said my daughter owed. But they have still not offered an explanation, or an apology, or provided proof of the alleged debt. And I only got this far because I contacted the head of media relations and asked for his help. My efforts to get satisfaction as an 'ordinary' customer got us precisely nowhere. Good luck with any RBS problem; you'll likely need it. Don't get me started, by the way, on GE Money and the crooked car dealers it helps finance...

Old Mother Hubbard Went To The Cupboard...

Old Mother Hubbard went to the cupboard and found that the cupboard was bare. Could anyone else hear the old nursery rhyme running through their head while listening to Chancellor Alistair Darling read out his second Budget? An illustration of the bareness is the spiteful return of true Old Labour sentiment: when in doubt, tax the rich. Speaking of which, it was interesting to see the Conservative Party leader, David Cameron, use the dreaded quotation marks sign with his fingers when he used the word 'rich' in his reply to the Budget Speech (which I thought was a very good speech, much better than the usual turgid, flaccid response, if something can be turgid and flaccid at the same time).

This raises a philosophical question or two. Is someone earning £100,000 to £150,000 'rich'. The fact that they represent only around 2% of the country's population, as Chancellor Darling noted, suggests that the answer, relatively speaking, is yes. And few in the remaining 98% will waste any tears as they work out how to best avoid paying the new levies being proposed. One way of course is to work less hard, and earn less, and enjoy more spare time rather than trigger a large increase in the marginal tax rate.

I never understood this fully when I studied Applied Economic for my banking exams back in 1979-80, but eventually got the point. Maybe Chancellor Darling dropped out halfway through and never absorbed the lesson about how the propensity to work can fall quite markedly in response to the propensity to tax.

But if the politics of envy is to replace the politics of greed, at least we can all see one thing that should add a basis point or two to the nation's overall gaiety. The country's top footballers, playing in the so-called Premiership (or Football League Division One as it is still known to we hardened reactionaries) will be amongst the highest profile victims, both in their earnings and in their pension provision. I might enjoy an extra bit of schadenfreude from the knowledge that Brown, Darling, Milliband, Smith, Harman, Blears, Straw and the sundry others who make up the deep pool talent on Labour's front bench will also be hit in the pocket, but what the Chancellor takes away with his tax rises, our Right Honourable friends will surely find a way to claim back on their expenses. No receipts required, of course.

Twenty's Plenty, but...

I've been predicting for several years now that the UK would see its road speed limits reduced, and from reports in the national press this week it would seem that my prediction is about to come true. The speed limit will fall to 20mph from 30mph on housing estates, for instance, and to 50mph from 60mph on dual carriageways, if the proposals go through. The aim is, of course, to save lives. We must reduce the number of accidents and deaths on the roads to the minimum number, but of course this is nonsense; if that were truly the  case, road traffic would be banned, end of story.

For what it's worth, I personally believe that Twenty's Plenty on housing estates and other similar roads. In fact, in parts of central Scotland they use the 'nudge' rather than the blow over the head to make exactly that point, with the phrase 'Twenty's Plenty' painted on roads in such a manner as to appeal to your common sense and slow down. But why do I get this nagging feeling that health and safety is not the real driving force here? It's because when I accumulated six points on my own licence a number of years back, in the space of just a few weeks travelling at what I felt were relatively slow and safe speeds (42mph and 37mph in 30mph zones) I began to adhere slavishly to official limits to avoid receiving a ban.

This changed my own driving behaviour, but also led me to my prediction. When revenue drops from fining people who start driving within the existing limits, I said to anyone who would listen, they will compensate for the shortfall by reducing the speed limits and start to fine us all over again.

I submit that road safety has little to do with these latest proposals. As with so much UK Government action, irrespective of its political name, revenue-gathering is the primary name of the game. What do you think?

Just Exactly Why Can't Banks Be Allowed To Fail?

Letter to the Financial Times February 28 2009

Dear Sir,

Your editorial in today's newspaper (Saving HM Royal Bank of Scotland) makes several references to the presumed immunity of banks to normal commercial pressures (too big to fail, the banks must be saved, clearly cannot be allowed to fail). Would you please explain why? Over the past 18 months or so, I cannot readily recall reading a reasoned justification of that presumption, yet it underpins all efforts to confront the crisis.

If Woolworths and Zavvi and MFI and other businesses can be allowed to go bust, why not banks? As a provider of a range of media services to large financial institutions, and to publications that depend on selling to large financial institutions, I have a vested interest in the status quo ante being reinstated, and soon, please. But I still cannot find any real justification why banks are a special case for which the laws of financial gravity must be repealed.

Yours sincerely,

Brian Bollen