GOLDEN RULES

Central Leader - - YOUR PAPER, YOUR PLACE -

Dis­tinctly un­der­whelmed and un­im­pressed.

No, that’s not my mu­sic teacher’s as­sess­ment of my talents at age 11, though I can still re­mem­ber what she wrote in my school re­port (‘‘Robert is suited to some work­man-like role in life’’).

It’s my re­ac­tion to the draft code of bank­ing prac­tice.

You prob­a­bly haven’t heard of the Code of Bank­ing Prac­tice. I’m not sur­prised.

But the pro­posed ver­sion tells you a lot about the na­ture of our banks, which are an un­avoid­able part of all our lives.

The cur­rent code is a set of pledges banks make about how they will be­have to­wards cus­tomers, though the code, cre­ated by the Bankers Association club of banks, is not bind­ing in a court of law.

The code is a throw-back to the dark days of fi­nan­cial ser­vices in­dus­try ‘‘self reg­u­la­tion’’.

As a coun­try we be­came so col­lec­tively sick­ened by fail­ures of fi­nan­cial ser­vices com­pa­nies to

Read your bank con­tracts and terms and con­di­tions

Take your re­spon­si­bil­i­ties se­ri­ously Or suf­fer the con­se­quences

do the right thing, we wrote proper laws end­ing the sel­f­reg­u­la­tion ex­per­i­ment.

So what does the Bankers Association’s draft code say?

The draft code prom­ises you, the bank cus­tomer, five things.

One: To treat cus­tomers fairly and rea­son­ably. Okay, but what do fairly and rea­son­ably mean?

‘‘What may be fair and rea­son­able in any case will de­pend on the cir­cum­stances, in­clud­ing our con­duct and yours, what our terms and con­di­tions say, what the law says, and good bank­ing prac­tice,’’ the code says.

Trans­la­tion: We can do what the law al­lows, what other banks do, and what bank con­tracts say we can do.

If you miss a mort­gage pay­ment, is it fair and rea­son­able for the bank to de­mand full im­me­di­ate re­pay­ment? Yes, ac­cord­ing to the code.

If you get into trou­ble with your credit card, is it fair and rea­son­able for your bank to sell your debt to a debt col­lec­tor? Again, yes, ac­cord­ing to the code.

Two: To com­mu­ni­cate with you clearly and ef­fec­tively.

Okay, the law re­quires this, but just read the terms and con­di­tions on a credit card and tell me if you think more than half your fel­low coun­try peo­ple could un­der­stand them.

Three: To re­spect your pri­vacy and con­fi­den­tial­ity and keep our bank­ing sys­tems se­cure.

Yes, that’s the Pri­vacy Act, and a host of other laws.

What does se­cure mean? Well, this: ‘‘We will keep your in­for­ma­tion and the ways you bank with us as se­cure as we can.’’

As we can? Drop the last three words, please. They frighten me.

Four: To act re­spon­si­bly if we of­fer or pro­vide you with credit. Again, this is re­quired by law. Five: To deal ef­fec­tively with your con­cerns and com­plaints.

This in­cludes deal­ing with them quickly. Good, some­thing of value at last.

Look, here’s the truth about banks. They are pow­er­ful pro­fes­sional en­ti­ties with an in­sa­tiable de­sire for profit.

The draft code tells us what to ex­pect from banks. I didn’t find it very in­spir­ing.

Had it promised sim­ply that banks would be­have fairly, eth­i­cally and rea­son­ably to­wards cus­tomers, and let the courts de­cide in each case what that meant, I’d ap­plaud.

123RF

A pic­toral ver­sion of my view of the draft bank­ing code of con­duct.

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