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Pressure on banks to accept voluntary code of conduct

BY INGRID BROWN Associate editor — special assignment browni@jamaicaobserver.com

Tuesday, September 25, 2012    

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THE Consumer Affairs Commission (CAC) is to increase the pressure on local banks to accept a voluntary code of conduct, drafted to protect the

rights of consumers and ensure

greater transparency in the financial services sector.

Chair of the CAC board, Lorna Green, said the commission may be forced to look at legislation if the banks continue to ignore its requests to respond to the voluntary code.

In the absence of legislation, the chairman declared that the CAC has the powers of the First Instance Tribunal on its side if it opts to go that route.

The tribunal, which is a quasi-legal body, operates as a small-claims court to levy and collect fines.

"We went the route of least resistance and we have been rebuffed... so, we will see how this process plays out and from there we will plan the next phase of this mission because this is something that must be done," Green told reporters and editors at the weekly Monday Exchange held at the Jamaica Observer offices yesterday Kingston. "We have been beating on doors and no one is listening to us and so we will be turning up the volume."

Green insisted that the aim of the CAC was not to shame the banks into adopting the code, but that there will be a more strategic and focused public education campaign going forward.

"It is not about shaming them, but bringing facts to bear and have persons understand what the facts are and advocating their rights as citizens and depositors and borrowers of these financial institutions," she said.

Candice Ramessar, project co-ordinator of Consumers International, said the project to develop the code was done in Jamaica, Barbados and Trinidad and Tobago because of the issues identified by its member organisations in these countries.

She explained that among the issues identified during a survey are excessive charges for credit cards, were inconsistent contract terms and arbitrary changing of contract terms without consulting customers.

"As a result, we thought the best way to deal with these issues was to develop a banking code," she said.

She noted that a concern of the project has been the stance of the Jamaica Bankers Association and their almost "non-involvement or refusal to interact with the representatives of the consumers in Jamaica which would be the CAC and the National Consumers League."

Several letters, she said, have been written to them but that the responses have not been favourable.

"When they have responded, the response has been less than favourable as they have indicated to us they are only interested in speaking with their regulator which is the Bank of Jamaica," she said.

Dennis Chung, a consultant of the Caribbean Consumer Protection Project, told the meeting that the idea for the code came from a regional conference in Barbados, which was shunned

by representatives of the Jamaica banking sector.

Although the decision was started in Jamaica, he said, more progress has been made in the other countries.

The voluntary code, he said, was developed to offer a "complimentary and compromising relationship between consumer and bank".

The draft code speaks to issues such as non-discriminatory access for all consumers; service standards such as average wait times; response time to complaints and queries; turn-around time for service application; terms and conditions of contracts and the need to make prominent some of the more contentious issues which are in

fine print.

Dispute resolution and the minimum standard time for processing complaints are also addressed.

Chung said the reason the CAC has delayed its public education campaign on the code was to encourage more feedback from banks.

"But the decision was taken by CAC that if it didn't come by a certain time that they would start the education campaign and that is what they are doing," he said.

Chief executive officer of the CAC, Dolsie Allen, said a deliverable of the project is an education campaign with the emphasis being on educating consumers on fair financial services.

"It is two-fold; we want to sensitise consumers to their rights to fair financial services and we want the bank to realise they need to be transparent in their operations," she said.

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