BFSO has conducted a total of 19 investigations into systemic problems during the year in review. 15 of these issues have been resolved, and investigations are continuing into the remaining four matters. These investigations are important in a broader sense because the issues have either affected, or have the potential to affect a large number of consumers in addition to those who have complained to BFSO.

The following are examples of some systemic problems BFSO has considered over the past year.


Failure to Supply Credit Card Account Statements

In January 2004, one member failed to send account statements to approximately 72,000 credit card holders. These card holders had not made any customer initiated transactions on their accounts, but the member had debited an annual fee to their accounts in January. As a fee had been charged, statements should have been issued.

Many of these customers did not make any repayments to their accounts in February 2004 because they were unaware that the annual fee had been charged. As a result, many were charged a late repayment fee, and interest on the outstanding amount. Others were also charged a duplicate statement fee when they requested copies of their January statements.

When this matter was brought to the member’s attention, it promptly acknowledged the problem and made arrangements for fees and interest to be refunded.

Charging Double Fees for Cheque Dishonour

One dispute that we received illustrated that one member had been charging a $20 unauthorised overdraft fee and a $35 cheque dishonour fee when it dishonoured cheques due to insufficient funds.

We advised the member that as the cheques had been dishonoured, no overdraft had been provided to customers, and in such circumstances, an unauthorised overdraft fee was not appropriate.

The member accepted our view and implemented a systems change to ensure that only the cheque dishonour fee is charged when a cheque is dishonoured.

The member also agreed to refund the $20 unauthorised overdraft fee to all customers who had been charged inappropriately over the last six years.