Hidden charges: the next big scandal for banks?

The high cost of banks' lack of transparency.

 

If there’s one thing that the banks have probably had enough of, it’s talk of transparency. After all, their recent run-ins with transparency have been largely unwelcome and revealed some hideous schemes – LIBOR-rigging, for example, and the mis-selling of PPI and interest-rate insurance. No wonder they fear daylight.

In many senses, they’re not in the clear yet. Banks and investment management companies are mysterious, opaque and occasionally downright deceptive about the fees they charge to wrangle your money. One woman is as mad as hell about it and isn’t going to take it any more.

Gina Miller, who with her husband, Alan, runs SCM Private, a wealth management firm, has commissioned a survey as part of her True and Fair Campaign, which shows that 92 per cent of people think that investment managers should be legally obliged to provide information about charges.

Gina has spoken out angrily: “It is completely indefensible that two-thirds of people buying investment products do not know how much they are paying in fees and charges.

“But what is worse is the fact that while we call for transparency and 100 per cent disclosure, the industry continues to hide under a thin rhetorical veil promising more disclosure, not full disclosure, and wraps itself in opaque, ill-defined guidelines.”

The government has already gone to certain lengths to try to ensure transparency with its Retail Distribution Review. Investment managers no longer get paid by the people whose products they sell (a clear inducement to favour those who pay more, not whose products are better) but rather by clients. Clients should never not know what they’re paying.

Yet Gina Miller goes beyond this, to hidden fees and charges from the manager: half a per cent to use foreign currencies here, vastly inflated fees to execute trades there.

This may seem like an issue affecting the few – and who has more sympathy for them? As the True and Fair website points out, however, anyone with savings or a pension is likely to be subject to these sneaky fees, too.

Could fees and charges be the next big scandal for the banks? It’s unlikely – the behaviour is bad, not criminal – but they certainly hurt many people and the more light shone on them, the better for us all.

Fee-fi-fo-fum: banks' fees remain opaque and confusing. Photograph: Peter Macdiarmid/Getty Images

Josh Spero is the editor of Spear's magazine.

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Our union backed Brexit, but that doesn't mean scrapping freedom of movement

We can only improve the lives of our members, like those planning stike action at McDonalds, through solidarity.

The campaign to defend and extend free movement – highlighted by the launch of the Labour Campaign for Free Movement this month – is being seen in some circles as a back door strategy to re-run the EU referendum. If that was truly the case, then I don't think Unions like mine (the BFAWU) would be involved, especially as we campaigned to leave the EU ourselves.

In stark contrast to the rhetoric used by many sections of the Leave campaign, our argument wasn’t driven by fear and paranoia about migrant workers. A good number of the BFAWU’s membership is made up of workers not just from the EU, but from all corners of the world. They make a positive contribution to the industry that we represent. These people make a far larger and important contribution to our society and our communities than the wealthy Brexiteers, who sought to do nothing other than de-humanise them, cheered along by a rabid, right-wing press. 

Those who are calling for end to freedom of movement fail to realise that it’s people, rather than land and borders that makes the world we live in. Division works only in the interest of those that want to hold power, control, influence and wealth. Unfortunately, despite a rich history in terms of where division leads us, a good chunk of the UK population still falls for it. We believe that those who live and work here or in other countries should have their skills recognised and enjoy the same rights as those born in that country, including the democratic right to vote. 

Workers born outside of the UK contribute more than £328 million to the UK economy every day. Our NHS depends on their labour in order to keep it running; the leisure and hospitality industries depend on them in order to function; the food industry (including farming to a degree) is often propped up by their work.

The real architects of our misery and hardship reside in Westminster. It is they who introduced legislation designed to allow bosses to act with impunity and pay poverty wages. The only way we can really improve our lives is not as some would have you believe, by blaming other poor workers from other countries, it is through standing together in solidarity. By organising and combining that we become stronger as our fabulous members are showing through their decision to ballot for strike action in McDonalds.

Our members in McDonalds are both born in the UK and outside the UK, and where the bosses have separated groups of workers by pitting certain nationalities against each other, the workers organised have stood together and fought to win change for all, even organising themed social events to welcome each other in the face of the bosses ‘attempts to create divisions in the workplace.

Our union has held the long term view that we should have a planned economy with an ability to own and control the means of production. Our members saw the EU as a gravy train, working in the interests of wealthy elites and industrial scale tax avoidance. They felt that leaving the EU would give the UK the best opportunity to renationalise our key industries and begin a programme of manufacturing on a scale that would allow us to be self-sufficient and independent while enjoying solid trading relationships with other countries. Obviously, a key component in terms of facilitating this is continued freedom of movement.

Many of our members come from communities that voted to leave the EU. They are a reflection of real life that the movers and shakers in both the Leave and Remain campaigns took for granted. We weren’t surprised by the outcome of the EU referendum; after decades of politicians heaping blame on the EU for everything from the shape of fruit to personal hardship, what else could we possibly expect? However, we cannot allow migrant labour to remain as a political football to give succour to the prejudices of the uninformed. Given the same rights and freedoms as UK citizens, foreign workers have the ability to ensure that the UK actually makes a success of Brexit, one that benefits the many, rather than the few.

Ian Hodon is President of the Bakers and Allied Food Workers Union and founding signatory of the Labour Campaign for Free Movement.