OnlyMe Posted September 4, 2006 Share Posted September 4, 2006 Ponzi-point banking. http://www.thisismoney.co.uk/campaigns/art...id=163&ct=5 Revealed: The bank bonus game Sascha Hutchinson, This is Money 3 September 2006 SECRET documents leaked from two major banks show how bosses get their staff to sell big loans and the profitable insurance policies that go with them. BIG POINTS: Natwest staff can earn a quarterly bonus of £1,200 if they hit the right points Commission tables for Royal Bank of Scotland and NatWest reveal a score system in which bank workers amass disproportionally more points for selling larger loans and for those sold with insurance - sparking fears that inappropriate products are being pushed. In-branch customer service advisers are able to earn a quarterly bonus of £1,200 if they consistently reach a weekly target of about 2,700 points over three months and if their branch also reaches its three-monthly target. ...... Mortgages are also good business. Staff who sell a mortgage of more than £250,000 earn 675 points, while the sale of a mortgage of less than £20,000 earns only 25 points. Quote Link to comment Share on other sites More sharing options...
JustYield Posted September 4, 2006 Share Posted September 4, 2006 Ponzi-point banking. http://www.thisismoney.co.uk/campaigns/art...id=163&ct=5 Revealed: The bank bonus game Sascha Hutchinson, This is Money 3 September 2006 SECRET documents leaked from two major banks show how bosses get their staff to sell big loans and the profitable insurance policies that go with them. BIG POINTS: Natwest staff can earn a quarterly bonus of £1,200 if they hit the right points Commission tables for Royal Bank of Scotland and NatWest reveal a score system in which bank workers amass disproportionally more points for selling larger loans and for those sold with insurance - sparking fears that inappropriate products are being pushed. In-branch customer service advisers are able to earn a quarterly bonus of £1,200 if they consistently reach a weekly target of about 2,700 points over three months and if their branch also reaches its three-monthly target. ...... Mortgages are also good business. Staff who sell a mortgage of more than £250,000 earn 675 points, while the sale of a mortgage of less than £20,000 earns only 25 points. Ok, so how would you set their incentives, given that it's their business to push financial products? (sorry, I'm grouchy) JY Quote Link to comment Share on other sites More sharing options...
OnlyMe Posted September 4, 2006 Author Share Posted September 4, 2006 For a start on the regulatory front I would make the wide scale pushing of policies which are totally inappropriate for a customer and given the status of the customer would never be able to be claimed upon punishable by revocation of a trading licence (maybe on a product by product basis), including all whoel or part-owned subsidiaries. I'd do the same with loans/cerdit, maybe based on a resulting default-basis where it has been shown that a certain default percentage has been hit and therefore the loans were originally missold. The commission structure is then a matter for the banks themselves. Quote Link to comment Share on other sites More sharing options...
JustYield Posted September 4, 2006 Share Posted September 4, 2006 The commission structure is then a matter for the banks themselves. This is the bit I was asking about. Have they done anything illegal? Quote Link to comment Share on other sites More sharing options...
eek Posted September 4, 2006 Share Posted September 4, 2006 For a start on the regulatory front I would make the wide scale pushing of policies which are totally inappropriate for a customer and given the status of the customer would never be able to be claimed upon punishable by revocation of a trading licence (maybe on a product by product basis), including all whoel or part-owned subsidiaries. I'd do the same with loans/cerdit, maybe based on a resulting default-basis where it has been shown that a certain default percentage has been hit and therefore the loans were originally missold. The commission structure is then a matter for the banks themselves. I would go for a simply rule. Where a loan defaults and the bank cannot show that sufficient due diligence was taken (i.e. check on safety of job, check on real finance situation not what the client claims) a CCJ should not be allowed and the loan must be written off. Two seconds after this becomes law I can guarantee that the miracle economy will go splat. Quote Link to comment Share on other sites More sharing options...
OnlyMe Posted September 4, 2006 Author Share Posted September 4, 2006 Justyield, Not illegal to missell a product (at the moment). I would go for a simply rule. Where a loan defaults and the bank cannot show that sufficient due diligence was taken (i.e. check on safety of job, check on real finance situation not what the client claims) a CCJ should not be allowed and the loan must be written off. Two seconds after this becomes law I can guarantee that the miracle economy will go splat. Even better. What about the PPI front - this stuff has been sold in the full knowledge that payment could not be claimed in any event becuase of the circumstances of the customer, the availability of loans in many cases were conditional on the PPI being in place. Quote Link to comment Share on other sites More sharing options...
atp_uk Posted September 4, 2006 Share Posted September 4, 2006 It's not in a banks interests to lend money it will never see again. Quote Link to comment Share on other sites More sharing options...
eek Posted September 4, 2006 Share Posted September 4, 2006 Justyield, Not illegal to missell a product (at the moment). Even better. What about the PPI front - this stuff has been sold in the full knowledge that payment could not be claimed in any event becuase of the circumstances of the customer, the availability of loans in many cases were conditional on the PPI being in place. I would think that a good lawyer would get a court to agree that this was mis-selling. Most people would of course be panicing too much to think about this course of action tho. Quote Link to comment Share on other sites More sharing options...
teddyboy Posted September 4, 2006 Share Posted September 4, 2006 I remember many years ago... the Midland (can name them coz they dont exist anymore) said the ONLY way they would give me my car loans was IF I took out their payment propection on it. In hindsight now, the f*ckers screwed me TB Quote Link to comment Share on other sites More sharing options...
eek Posted September 4, 2006 Share Posted September 4, 2006 It's not in a banks interests to lend money it will never see again. Sadly, this is not the case. Its often the case the bank is not lending its own money (look at any fixed rate or tracker mortgage and you will see a consolidated mortgage security in some market or pension fund somewhere). Secondly most people will endeavour to repay a loan regardless of the pain it causes. Banks are good at scaring people into repaying come what may Quote Link to comment Share on other sites More sharing options...
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