http://www.conpolicy.de/ Conpolicy-News en http://www.conpolicy.de/typo3conf/ext/tt_news/ext_icon.gif http://www.conpolicy.de/ 18 16 Conpolicy-News TYPO3 - get.content.right http://blogs.law.harvard.edu/tech/rss Tue, 24 Aug 2010 14:05:00 +0200 http://www.conpolicy.de/en/news-single/britische-verbraucherschuetzer-vermelden-teilerfolg-bei-der-verguetung-bei-banken.html The British consumer organization, Which?, announced a success of its Future of the Banking Commission’s work. Which? said that the Financial Services Authority now appears to be acting on its concerns by announcing a review of reward structures for in-house sales staff to see if incentives are... The British consumer organization, Which?, announced a success of its Future of the Banking Commission’s work. Which? said that the Financial Services Authority now appears to be acting on its concerns by announcing a review of reward structures for in-house sales staff to see if incentives are well-designed to guard against mis-selling.  The Banking Debate raised the following problems:

• The pressure tactics banks use
• The shift away from a personalised banking service to one driven be sales targets
• Banks pushing products that consumers do not want or need

As a consequence Which? has been campaigning for reform of sales practices in banks, including:

• Remuneration for frontline staff not linked to sales but rewarding customer satisfaction
• Customers treated fairly and complaints resolved in a fair and timely manner
• No commission or bonuses received for selling products

For further information, see: https://info.which.co.uk/servlet/website/ResponseForm?PopJoEVTUTTBVX_8u88splmEmohkNgFJhgihspJRDKL Source: Which?]]> Tue, 24 Aug 2010 14:05:00 +0200 http://www.conpolicy.de/en/news-single/britische-finanzaufsicht-verbessert-verbraucherschutz-bei-restschuldversicherungen.html Reacting to insufficiencies in the market for Payment Protection Insurance (PPI), the Financial Services Authority (FSA) today published a policy statement to enhance consumer protections. The package should ensure that consumers are treated more fairly when complaining about PPI. It includes...

new handbook guidance to ensure complaints are handled properly, and redressed fairly when appropriate; and

an explanation of when and why firms should analyse their past complaints to identify if there are serious flaws in sales practices that may have affected complaints and even non-complaints.

FSA’s director of conduct risk, Dan Waters, highlighted that the FSA “carried out 24 investigations and three thematic reviews, issued warnings, halted the selling of single premium PPI with unsecured personal loans, visited over 200 firms, and handed out some very significant fines. Now, with this package of measures we’re confident we can mend a market that has been broken for too long.”   For further information, see: http://www.fsa.gov.uk/pages/Library/Communication/PR/2010/132.shtml Source: FSA]]> Tue, 10 Aug 2010 16:30:00 +0200 http://www.conpolicy.de/en/news-single/britische-regierung-eroeffnet-konsultation-zur-neuordnung-der-finanzaufsicht.html Today the Financial Secretary to the Treasury, Mark Hoban, opened a public consultation on the UK government’s proposal to financial regulation. The proposal envisages to place the Bank of England in charge of macro-prudential regulation and to establish a new conduct regulator - the Consumer... The CPMA will be given a broad mandate to monitor retail financial markets, regulate exchanges and fine banks. In a speech at the London Stock Exchange Hoban stressed that the new body will “build on the FSA’s recent progress towards a more proactive and interventionist approach to retail conduct regulation, backed by tough enforcement to ensure credible deterrence.” The proposal also envisages the establishment of three advisory panels - consumer, practitioner and small business practitioner. Comments to the consultation can be submitted by 18 October 2010. For further information, see: http://www.hm-treasury.gov.uk/d/consult_financial_regulation_condoc.pdf and http://www.hm-treasury.gov.uk/speech_fst_260710.htm Source: HM Treasury]]> Mon, 26 Jul 2010 21:00:00 +0200 http://www.conpolicy.de/en/news-single/neue-spielregeln-fuer-die-us-finanzindustrie.html On Thursday US Senate approved the broadest overhaul of financial rules for years. It is expected that President Obama will sign it into law next week. The more than 2,300 page bill comprises a range of different measures. These include a new system to monitor risks to the financial system, new... The more than 2,300 page bill comprises a range of different measures. These include a new system to monitor risks to the financial system, new powers for the US government to contain the damage from failing firms if they threaten the broader economy, more control of the derivatives market to increase accountability and transparency, limits to proprietary trading, and more consumer protections. The new Consumer Financial Protection Bureau - housed in the Federal Reserve - will oversee financial products and services such as mortgages, credit cards, payday loans, check cashing and private student loans in the interest of consumers. Furthermore, the bill entails other measures to enhance consumer protection, such as:

• the fees that banks charge retailers when consumer use debit cards are cracked down.
• mortgage lenders are required to determine that borrowers have the ability to repay their loans.
• prepayment penalties for mortgages are limited or eliminated.
• all consumers are entitled to free credit scores when they are denied credit or charged a higher price for credit because of information in their credit report.

US consumer organizations hail the passing of the bill. Consumers Union calls the bill a “game changer”. The coalition of US consumer organizations, Americans for Financial Reform, sees the passage of this legislation as a victory “for Main Street over Wall Street”. For further information, see: http://www.reuters.com/article/idUSTRE66E0MD20100715, http://www.consumersunion.org/pub/core_financial_services/016644.html and http://ourfinancialsecurity.org/2010/07/afr-victory-for-main-street/ Source: Reuters, Consumers Union und Americans for Financial Reform]]> Fri, 16 Jul 2010 09:38:00 +0200 http://www.conpolicy.de/en/news-single/britische-finanzaufsichtsbehoerde-stellt-verbraucherschutzprioritaeten-vor.html In a speech at the British Bankers’ Association last Monday, Chairman of the British Financial Services Authority (FSA) Adair Turner summarized the priorities of the FSA in the realm of consumer protection. In the past - he argued - the FSA-approach was guided by the belief that the crucial thing...

Financial services are credence goods - their quality can often only be assessed after years.

Consumers are relatively unused to buy financial services - a pension or life police is only purchased once or twice a life - hence consumers can only insufficiently learn from their experience.

There is a great asymmetry of information and knowledge between consumers and producers.

Financial services are inherently complex - and sometimes even simple products are made opaque if that helps producers make money.

As a result, the FSA has moved to a more interventionist approach four years ago. One example of this new approach is to be found in the retail distribution review. The review questioned whether commission-based remuneration is appropriate rather than simply investigating whether commission levels are well disclosed. As a result of this review, from January 2013 consumers will know that an independent adviser is not being paid by producer commissions, and therefore not incentivised to recommend a particular product or provider. Such an approach also necessitates new instruments. These include, inter alia:

• to spot risks earlier by means of a horizon-scanning function, analysing trends in the economic and market environment to identify potential risks to consumers.
• to examine firms’ business models to understand the drivers of profitability and the implications of firms’ strategies. As part of this work the FSA will scrutinize reward structures for in-house sales staff, to assess whether sales incentives are well-designed to guard against mis-selling.
• to look whether firms have product development and approval processes well-designed to weed out harmful or inappropriately marketed products.

Lord Turner underlined that such a more interventionist approach was also a more political one. In light of the fact that the responsibility for consumer protection will move to the new Consumer Protection and Markets Authority in 2012 he urged all stakeholders to engage in a debate how far a consumer protection mandate should reach. Fur further information, see: http://www.fsa.gov.uk/pages/Library/Communication/Speeches/2010/0713_at.shtml and http://www.economist.com/blogs/freeexchange/2010/07/financial_reform Source: FSA, The Economist]]> Thu, 15 Jul 2010 15:18:00 +0200 http://www.conpolicy.de/en/news-single/britische-verbraucher-sind-nicht-bereit-fuer-intelligente-stromzaehler-zu-zahlen.html The British testing organization, Which?, questioned 2,000 UK adults about their attitudes regarding smart meters. Nine in ten people say that energy suppliers should pay for smart meters if they are going to save money from the scheme. Which? Chief executive, Peter Vicary-Smith argued:... Which? Chief executive, Peter Vicary-Smith argued: “Understandably, people don’t see why they should pay for something that will save energy companies hundreds of millions of pounds a year.” The results of the survey are mirrored in a German study that was released in May 2010 by the Federation of German Consumer Organizations (vzbv). It showed that while 71 per cent of consumers approve of the technology in general, only 4 per cent were willing to pay for a smart meter. For further information, see: http://www.which.co.uk/about-which/press/press-releases/campaign-press-releases/energy/2010/07/consumers-not-prepared-to-pay-for-smart-meters.jsp and https://www.vzbv.de/start/index.php?page=themen&bereichs_id=1&themen_id=89&dok_id=932&search_1=smart&search_2=&hiliting=yes Source: Which? and vzbv]]> Tue, 13 Jul 2010 15:49:00 +0200 http://www.conpolicy.de/en/news-single/oecd-veroeffentlicht-werkzeugkiste-fuer-verbraucherpolitiker.html Consumer markets have rapidly developed in recent years demanding higher levels of knowledge and skill on the part of consumers. At the same time consumer expectations have changed: The public expects policy makers to respond with speed and effectiveness to new challenges and problems. With... Consumer markets have rapidly developed in recent years demanding higher levels of knowledge and skill on the part of consumers. At the same time consumer expectations have changed: The public expects policy makers to respond with speed and effectiveness to new challenges and problems.  With these challenges in mind the OECD Committee on Consumer Policy has developed a policy toolkit for consumer policy makers through the last couple of year. It has now been published. The toolkit is a practical guide that is designed to aid policy makers in using a systematic approach to identify and evaluate consumer problems and to develop, implement and review effective consumer policies. The toolkit draws upon conventional and behavioural economics. The toolkit was mainly written by practitioners, who deal with consumer policy issues in their everyday life.   For further information, see: http://www.oecd.org/document/34/0,3343,en_2649_34267_44074466_1_1_1_1,00.html Source: OECD]]> Mon, 12 Jul 2010 14:52:00 +0200 http://www.conpolicy.de/en/news-single/oecd-gruendet-arbeitsgruppe-um-produktsicherheit-zu-verbessern.html The OECD announced today that it will create a new Working Party that focuses on the safety of consumer products. The Working Party will implement a ten-point action plan. This plan focuses on improving information sharing and promoting greater co-operation among enforcement authorities... Michal Jenkin, Chairman of the OECD’s Committee on Consumer Policy, explained: “A number of high profile recalls worldwide have focussed attention on safety problems and their global nature. The Committee on Consumer Policy reacted quickly, bringing key players to the table to explore the scope of the problem and ways to address concerns.” It is envisaged that, inter alia, a web-based recalls database will be operational next year. For further information, see: http://www.oecd.org/documentprint/0,3455,en_2649_34267_45533880_1_1_1_1,00.html and http://www.oecd.org/dataoecd/16/53/45534271.pdf Source: OECD]]> Wed, 07 Jul 2010 16:23:00 +0200 http://www.conpolicy.de/en/news-single/weg-frei-fuer-verbesserten-verbraucherschutz-bei-finanzdienstleistungen-in-den-vereinigten-staaten.html In a marathon session of more than 21 hours, House and Senate negotiators hammered out a historic overhaul of financial protections last Friday. It is expected that both chambers of Congress will give final approval this week so that US President Obama can sign the bill into law soon. A new Bureau... A new Bureau of Consumer Financial Protection is at the heart of the bill. The new Bureau will oversee consumer financial products such as mortgages, credit cards, and payday loans. The Bureau will be housed in the Federal Reserve and it will have an independent director with reliable funding and full rulemaking authority over a broad range of financial products. In addition to the Bureau, the bill contains several other reform measures:

• All consumers will be able to get free credit scores when they are denied credit because of their credit scores.
• An Office of Credit Ratings is established to promote accurate credit ratings and ensure these ratings are not unfairly influenced by conflicts of interests, and the bill allows investors to sue credit agencies.
• The Federal Trade Commission, on an expedited basis, can develop and enforce new rules to protect consumers from unfair and abusive auto financing transactions.

US consumer organizations hail the bill. The Consumer Federation of America argues that the “bill marks the biggest transformation of financial regulation in this country since the Great Depression”. And Consumers Union specialist Pamela Banks argues that “The idea of a consumer watchdog was deemed dead on arrival last fall, but that prediction turned out to be completely, blissfully wrong.”   For further information, see: http://www.reuters.com/article/idUSTRE65L4A920100625, http://www.consumerfed.org/elements/www.consumerfed.org/File/PR_Conference_report_passage.pdf and http://www.consumersunion.org/pub/core_financial_services/016573.html Sources: Reuters, Consumer Federation of America, Consumers Union ]]> Mon, 28 Jun 2010 14:35:00 +0200 http://www.conpolicy.de/en/news-single/abschlussbericht-zur-zukunft-des-bankings-vorgelegt.html Due to the financial crisis not only 16 million jobs world-wide are lost, but banks had to write down $2.3 trillion of assets. The financial crisis has led to a debate on how to better regulate the financial market. This debate is characterized by the fact that the voice of ordinary citizens... Due to the financial crisis not only 16 million jobs world-wide are lost, but banks had to write down $2.3 trillion of assets. The financial crisis has led to a debate on how to better regulate the financial market. This debate is characterized by the fact that the voice of ordinary citizens and consumers is largely unheard. This deficit was a reason for the British consumer organization Which? to establish the Future of Banking Commission. It aimed to engage consumers in dialogue with experts and to highlight their concerns and to harness their views about what should be done. After four public hearings, the results are now published. The recommendations encompass measures to improve the structure, regulation and corporate governance of the financial services sector. The recommendations also highlight the need to consider further improvements in consumer protections such as:

• Ensure customers can easily transfer products and accounts.
• Ensure customers with overdrafts are not overcharged.
• Set ‘default’ settings on services, products and accounts in the customer’s best interest.
• Allow customers to choose to ‘opt-in’ to unauthorised overdrafts.
• Consider introducing standard products for some basic services which all retail providers have to provide, and a common form in plain English to explain the key terms so that customers can easily compare products provide by different providers on the same basis.

  For further information, see: http://commission.bnbb.org/banking/ and http://commission.bnbb.org/banking/sites/all/themes/whichfobtheme/pdf/commission_report.pdf Source: Which?]]> Tue, 15 Jun 2010 17:28:00 +0200