RBS Big fine - paid for by our money ?

OFT has fined Royal Bank of Scotland £28.59m for breaches of competition law dating back to October 2007, after it emerged the bank's Professional Practices Coverage Team disclosed confidential future pricing information to counterparts at Barclays. The fine was reduced from £33.6m to reflect the bank's admission, while Barclays qualified for immunity as it brought the matter to the OFT's attention - despite evidence it used the information to determine its own pricing.

Silent Calls - fine increases by 4 times

Companies that use telemarketing in their marketing mix were given a jolt this week after the Government upped the maximum penalty for so-called “silent calls” from £50,000 to £2m.

Silent calls or, as they more pointedly referred to, nuisance calls happen when a company’s automated calling systems dials more numbers than there is staff available to answer the phone.

Kevin Brennan, minister for consumer affairs, left companies in no doubt that untargeted telemarketing strategies will be punished.

“Consumers can be assured that the new fines are definitely more than a slap across the wrist for persistent offenders”, he ominously declared.

It is hoped that higher fines will provide a greater deterrent and Ofcom with more power to punish companies that ignore the guidelines in this area.

If the threat of a £2m fine does not panic companies into crisis meetings with their telecoms consultants to discuss how their dialling systems can be better managed, then the less quantifiable spectre of damaged brand reputation should inspire them into action.

Telecoms broadcaster Ofcom received 6,500 calls last year from irate customers that had been the victims of silent calls. It is a fair bet that there are thousands more that have been irked but rather than complaining to the regulator have registered their displeasure with their friends and or fellow customers - an infinitely more damaging prospect.

I am sure telemarketers are doing all they can to improve targeting, and warnings such as this, should serve to remind them that they need to continue to strive for better still. Fines aside, to be ruled against in the court of public opinion is a rather more punitive punishment.

As Brennan adds “I hope our decision will be a catalyst for better business practice, increasing customer loyalty and reducing operational costs for handling complaints.”

The first of many

Heathrow worker warned over body scanner misuse. A computer screen showing the results of a full body scan (generic)The scanners show clear outlines of passengers' anatomies

A Heathrow Airport security guard was given a police warning after he was allegedly caught staring at images of a female colleague in a body scanner.

The 25-year-old worker was quizzed by police over alleged remarks he made to his co-worker after she entered an X-ray machine by mistake.

The incident took place at Terminal 5 on 10 March.It is believed to be the first time an airport worker has been disciplined for abusing body scanners.

The scanners show clear outlines of passengers' anatomies.

They were introduced at Heathrow and Manchester airports to check for concealed weapons and explosives following the failed Christmas Day bomb plot by Umar Farouk Abdulmutallab to blow up a jet over Detroit in the United States.

A Scotland Yard spokesman said: "Police received an allegation regarding an incident that happened at Heathrow Terminal 5 on March 10.

"A first instance harassment warning has been issued to a 25-year-old male."

Marriage made in heaven ?

Coventry Building Society is to merge with Stroud & Swindon, creating a combined entity that will have around 1.5m members, £21.1bn of assets and 91 branches and agencies. Britain's third-largest mutual assured that no retail staff from Stroud & Swindon will be cut, although a number of head office positions will be at risk.

Jump the fence

Barclays has appointed Bartle Bogle Hegarty account director, Michelle McEttrick, as chief marketing officer for its Global Retail Banking arm. Ms McEttrick, who oversaw both Barclays and Barclaycard accounts at the agency, will be responsible for ensuring marketing consistency and best practice across the brands

Poor man's bank - that's for me then !

The Labour Party will create a “People’s Bank” to service the low-paid and provide competition to private retail banks if it wins the General Election.
The party is set to make the new banking network the centrepiece of its election pledges when it unveils its manifesto in the coming weeks.

The People’s Bank will run out of the network of 11,500 post offices around the country. The Government will lift the restrictions that limit the Post Office to offering savings products and allow them to provide current accounts.

Ed Miliband (pictured), energy secretary and one of the architects of the Labour Party’s manifesto, says the bank will be a “new deal for the low paid.”
“It speaks to people’s sense of community, and frankly, banks have let down low-income consumers,” he says, adding that the bank “can be a very serious financial institution and, if you like, a competitor to the conventional private sector”.

The bank could tap into public disquiet over the financial services industry, which is said to have increased in the 18 months since the worse of the financial crisis.
A recent poll of 1,600 consumers for the Direct Marketing Association found that 71% did not trust the industry.

The pledge will also win the support of unions and charities, which last year called for the creation of a “people’s bank” to provide more financial services to people and businesses not currently served by the major high street banks.

The perfect Data Storm....

Direct marketing and online activity are facing a perfect storm, according to Information Commissioner Christopher Graham. Speaking at the DMA Data Protection Conference earlier this month, he noted that advances in technology, the multiplicity of services available and “the mother of all recessions” are creating conflicting pressures.

“At the same time that data managers need to get data protection and information security solutions enabled in their business, finance directors are looking for savings,” he said. Rising expectations among customers about how their personal information will be protected are also running at odds with how easy it is for members of staff to steal data on USB sticks or laptops.

To close this gap, the ICO has successfully lobbied to be granted enhanced enforcement powers from 6th April, including fines of up to £500,000. But Graham noted that, “there are two sides to effective regulation - enforcement and education.” By looking to commercial organisations and trade bodies to uphold self-regulation and best practice, the ICO can “keep the big stick in the cupboard”.

The largest pension pot in the world!!!!

Santander chief executive, Alfredo Saenz, is entitled to an annual retirement sum of around £5m having accumulated a pension pot worth £75m - a pension deal described as one of the largest in global banking. Mr Saenz's total pension is worth more than six times the fund handed to former RBS chief, Sir Fred Goodwin. A separate set of the bank's accounts is expected to show that its UK chief executive, Antonio Horta-Osorio, earned £3.5m in 2009.

3D TV comes to your lounge this year!

BSkyB will launch Sky 3D, Europe’s first 3D TV channel, with the Barclays Premier League match between Manchester United and Chelsea on Easter Saturday (3 April).
Following the channel’s launch, Sky will then show at least a further five Premier League games before the end of the current season and the Coca-Cola Football League Play-Off Finals, all live and all in 3D.

The broadcaster says that more than a thousand pubs and clubs across the UK and Ireland have already signed up for Sky 3D.

Outside of the live games, a show reel showcasing the best of Sky 3D, which will cover a wide range of different programming, will run on Sky 3D during selected hours of the day. This programming, which will run from launch, will also be available to residential customers who subscribe to Sky’s top channels and HD pack.
Brian Lenz, Sky’s Director of Product Design and TV Product Development, says: “It’s fitting that one of the biggest games of the season will be the launch pad for our pioneering Sky 3D service.”

Last week Sony, Samsung, LG and Panasonic all confirmed plans to have 3D TVs on sale within weeks. Sky 3D is compatible with all of the product ranges being introduced by these manufacturers.

Later in the year, Sky 3D will offer a range of movies, sport, documentaries, entertainment and arts content. The channel will initially be introduced at no extra cost for customers who subscribe to Sky’s top channels and HD pack

Banks - it's a bad bad world out there

Anglo Irish Bank's former chairman, Sean FitzPatrick, has been arrested by police in connection with a fraud investigation into personal loans of more than £60m alleged to have been hidden from shareholders. Investigators are reported to have found evidence that Mr FitzPatrick transferred tens of millions of pounds of loans made to him by Anglo Irish Bank to Irish Nationwide, days before AIB published its annual accounts.

Bank of England has reported that bank lending to British businesses decreased by £6.5bn in January 2010, its fastest annual decline in a decade. The figure was also the largest monthly fall in net lending since July 2009 and reflected a 9.3% decrease over the past 12 months.

Co-operative Bank has posted a 43% increase in pre-tax profit in 2009 to £213m, following customer defections from traditional banks during the year. The group increased its market share of current accounts by 50% to 4%, opening 38% more accounts, or 150,000.

Lehman Brothers has accused Barclays of receiving a windfall profit worth billions from the deal to acquire its brokerage unit in September 2008. In court documents filed yesterday, the investment bank claims that Barclays received a $13bn windfall 'immediately upon acquisition'.

Lloyds Banking Group's former head of tax compliance, Andrew Constantine, has accused the bank of artificially inflating its profits by almost £1bn through the use of aggressive tax-avoidance schemes and 'Lehman-style' offshore deals. Mr Constantine told an employment tribunal that the bank refused to listen to staff who voiced concerns about the tactics adopted by the finance department, or institute reforms that would put its finances on a legal footing.

Royal Bank of Scotland deputy chief executive, Gordon Pell, is set to retire in March 2010 with a pension worth more than £13m. Meanwhile, the bank admitted it has a pension deficit of £2.91bn, and has plans for a new long-term bonus plan that could lead to executives being rewarded with shares worth up to five times their annual salaries if performance targets are met.

FSA - Hire everyone !!!!

FSA has announced plans to hire 460 more staff as it seeks to take a more 'risky and confrontational' approach to regulation. The regulator, which aims to switch from a 'reactive' to 'proactive' approach to supervision, said it plans to increase staff by 14% to more than 3,700, increasing staff costs by £47.4m to £350m.

I'd call it segmentation !

Which? has accused The Admiral Group of breaching the Race Relations Act after it discovered the insurer charges immigrants 18% more on car insurance premiums because they are considered a higher risk on the roads. The insurer stated that its premiums reflected its experience that motorists who had not been resident in the UK all their life generated approximately 20% higher costs from more and bigger claims.

Good idea but not a new idea

HSBC has launched a current account that prevents customers from spending beyond their overdraft limit. The ‘Bank Account Pay Monthly’ carries a monthly fee of £15 and also provides a £50 emergency 'buffer' for customers who urgently need funds. Customers will also receive SMS updates when they have used 60%, 80% and 95% of their overdraft.

ASA New code shake-up!!!

A new rule to stop marketers exaggerating the environmental benefits of their products will be introduced later this year as part of an overhaul of the advertising codes.

An explicit rule to prevent what has been called “greenwashing” will be included in the non-broadcast code while an environmental claims section will be included in the broadcast code.

The new rules on environmental claims are one of several changes to the Committee of Advertising Practice (CAP) codes for broadcast and non-broadcast media and follow a lengthy consultation with industry bodies, Government and advertising agencies.
The review of the codes, which are used by the Advertising Standards Authority when it adjudicates on the complaints received about campaigns, led to 30,000 submissions. These came mainly from anti-abortion campaigners that objected to the possibility that current restrictions on the advertising of “post-conception advice services” could be lifted.

Other new codes include:
- Allowing charities to launch TV and radio ads that compare one charity with another.
- The creation of a single broadcast code rather than the existing four codes.
- Removing the post-9pm scheduling restriction for condom advertising on TV allowing ads to air earlier in the evening.
- The application of the “strict” rules for alcohol products to be applied to low alcohol products of less than 1.2%ABV.
- A dedicated ’lottery advertising’ section to cover the National Lottery and lotteries licensed under the Gambling Act.
- New codes covering nutrition and health claims that reflect the provisions of the new European Nutrition and Health Claims regulation, which imposes rules on the types of claims that may be made about food products.
- New TV and radio scheduling restriction to prevent ads for age-restricted computer and console games from appearing around programmes watched by children.
- Rules to prevent marketers from collecting data from under-12s without obtaining the consent of their parent or guardian.

The new Codes will come into force on 1 September 2010.

BCAP has delayed its ruling on changes to the code on post-conception advice and is liaising with Ofcom ahead of a final decision.

No need to steal customer details - just wait for the banks to mess-up

Citi has apologised to around 600,000 customers in the US after sending them year-end tax statements with their social security numbers printed on the outside of the envelopes. The bank said the mistake was the result of a 'processing error'. It insisted there was 'little or no risk' to affected customers and offered a free credit monitoring service for 180 days.

HSBC has attempted to contact all the clients of its Swiss private bank after it admitted that data affecting 24,000 current and former clients had been stolen. The bank has admitted that 15,000 existing and 9,000 former clients were affected when Herve Falciani, a former HSBC IT specialist, stole the data and passed it on to the French tax authorities.

The ASA awareness for all....

The Advertising Standards Authority will launch its first consumer marketing campaign later this year to highlight its regulation of online advertising when the extension of the CAP Code to all forms of online advertising comes into effect.
The ASA is planning a “big consumer awareness drive” once the recommendations of the Advertising Association to extend the CAP Code are in place to make people aware its remit has expanded.

The Ad Association has released recommendations to extend the CAP Code from its current scope of only covering paid-for online advertising to encompass brands’ own websites and content on social networks such as Facebook, Twitter and YouTube.
It said more than 2,500 complaints to the ASA about online advertising in 2009 couldn’t be acted on because they weren’t within the CAP Code remit.

A spokesman for the ASA said, “The wider remit means we’ll receive a couple of thousand more complaints a year, but we also need to let people know that they can now complain about all online advertising and so we’ll be embarking on a consumer awareness drive.”

Alex Tait, chair of the Digital Action Group at advertiser trade body ISBA and digital sales and marketing manager at the Post Office, said the extension of the CAP Code would be welcomed by the online industry.

“As marketers, we know we can only produce successful campaigns if we keep the support and goodwill of our consumers,” he said. “That’s why beefing up the Code and extending its reach online is important. “By giving the consuming public greater confidence and by improving existing protections for children and young people, we’re demonstrating very clearly that acting responsibly is important to us.”
Rae Burdon, chief operating officer of the Ad Association, said one issue that had held back implementation of the extension of the code earlier had been funding.
“An extra 2,500 complaints a year means paying more people and enhanced IT systems, which we can now do because we resolved funding issues in a deal with Google and Asbof last year,” he said.

The Ad Association secured a deal between Asbof - the Advertising Standards Board of Finance, which collects a levy from advertisers that funds self-regulation - and Google in November. This has enabled it to expand its remit in online advertising regulation (nma 10 November 2009).

The recommendations are yet to be reviewed by th Committee of Advertising Practice and the ASA. The Ad Association expects the extended remit will come into effect this September if the terms are accepted, but it has already been met with support from the industry.
Michael Thompson, head of communications and external affairs at alcohol industry trade body The Portman Group, said the drinks industry welcomed the move but warned that it had to meet its regulatory standards.

“We support the creation of a one-stop shop for the regulation of digital advertising as long as there’s no watering down of standards for drinks producers and the ASA ensures standards that are as thorough as our own codes,” he said.
Nick Stringer, director of regulatory affairs at the Internet Advertising Bureau, said the recommendations, if cleared by the CAP and ASA, should build confidence and understanding in online, particularly where there are concerns about advertising to children and age restrictions.

“The recommendations were built on political concerns and issues around age-restricted products, so they were framed with political reality in mind,” he said. “Paid-for advertising online has been well regulated already but there isn’t high awareness of what paid-for ads are already covered by the code.”

If you live in London dig out your old bank books -

HSBC has announced it has reunited around 7,400 of its customers with a total of over £10.4m (average balance of £1,400) from accounts which they either had no knowledge of or had been left untouched for over 15 years. According to the bank, the region with the most funds still left in dormant accounts is Central London, with around £7m, followed by Greater London with over £4m. The fewest balances in dormant accounts are in Scotland (£200,000).

When times are hard put up your APR !

Defaqto research has found that the APR on a £5,000 loan increased from 9.8% to 13.9% between March 2008 and this month, raising the cost of borrowing by 42%. The study, conducted on behalf of The Independent, also found that the average APR on credit cards has reached a 12-year high of 18.8%. Meanwhile, figures from the BBA show that its members cut their exposure to personal loans by £15bn

Contactless moves to Business Customers

Barclays is to begin issuing new and replacement Visa debit cards with contactless technology as standard to business customers from March 2010. The bank, which instigated the same move in March 2009 for its personal customers, claims to have 6m contactless debit card holders.

Thanks Darling for helping these poor bankers with my taxes

Northern Rock is allegedly planning to pay bonuses worth £13m to its staff, with its 4,500 call centre workers receiving an average payment of around £3,000, according to the Daily Mirror.

Northern Rock has announced a loss of £257.4m for 2009 compared to £1.36bn in 2008 and reported that the percentage of mortgage customers in arrears increased from 2.25% to 4.28% over the same period. The state-owned bank also reported that the number of properties it repossessed fell from 3,620 in 2008 to 2,061 in 2009.

PR Marketing Strategy - ask Sallie Hinks how it could work for you!

Metro Bank is preparing to launch its debut advertising campaign, which it claims will follow a 'local store' marketing strategy. The first campaign, which will focus on public relations, will target relevant customers within the M25 through appropriate media outlets.

You're too small so I don't love you anymore

Royal Bank of Scotland is reportedly severing ties with a number of its smaller company clients and reducing its analysis of the small cap sector in an effort to concentrate on larger, more-profitable businesses. The bank, which inherited one of the City's most respected smaller companies research teams from Hoare Govett when it bought ABN Amro in 2007, is believed to have made a decision to focus on bigger companies in the FTSE 250.

The downs and downers of Banks

Allied Irish Bank has one of the worst loan books ever seen at any European bank and could run up losses of more than €3bn this year, according to Simon Adamson, senior analyst with CreditSights. Mr Adamson also said that the bank, which recently reported a pre-tax loss of €2.65bn for 2009, its first ever annual loss, had 'little prospect' of recovering soon.

Northern Rock is this week expected to report pre-tax losses of about £400m for 2009, a marked improvement on the £1.36bn of losses in 2008. Bad debts will hit a record of more than £1bn, reflecting the fact that a quarter of the bank's borrowers are in negative equity and problem loans account for almost 5% of the book.

BBC planning to move more £ to DM

The BBC is holding talks with direct marketing agencies as it explores dedicating more of its budget to direct marketing.

The corporation has appointed the AAR to approach agencies with a brief for a year-long project with a focus on eCRM.

Following the growth of video-on-demand and digital TV, the BBC has access to more specific and diverse data than ever before, and is understood to be keen on looking at new ways to exploit this data.

The data could help the corporation better understand consumers' attitudes and values, and provide them with better-targeted content ac¬ross a variety of platforms.
The BBC has been slow to capitalise on the benefits of CRM, predominantly because it has less need to target specific viewers, as it does not rely on commercial revenue.

News of the brief follows the announcement that the BBC is reviewing its £20m advertising account, currently held by Rainey Kelly Campbell Roalfe/Y&R and Fallon.

The process, which is also being handled by the AAR, kicked off in January, with pitches set for June or July

It's funny how the numbers add up !

HSBC is to pay chief executive, Michael Geoghegan, an additional £800,000 a year in 'allowances' and 'benefits in kind' for moving his family from London to Hong Kong. The extra allowance includes £300,000 for 'family disruption' and has been made 'in recognition of the additional costs of living' in Hong Kong. However, it comes after shareholders rejected plans to award Mr Geoghegan a pay rise of 40%, or £350,000.

Great Idea - IFA School - Earn as you Learn

Sesame has announced plans to launch an IFA school, with a pilot commencing this summer which will aim to take on 20 trainees and qualify them to QCF level within two years. Aimed at getting 'new blood' into the industry, the school will target those will financial services experience rather than fresh graduates. Trainees will receive a salary, funded either by member firms or sponsors of the venture.

What's wrong with Pinochio ?

Last month, easyJet was said to have threatened legal action against Ryanair over an advertisement that likened easyJet founder Sir Stelios Haji-Ioannou to Pinocchio.

Ryanair chief executive Michael O’Leary claimed that he had received a letter from easyJet’s solicitors demanding an apology and damages because the ad “caused ongoing and escalating damage to our client’s reputation”.

How big?

Hitwise research has found that Comparethemarket.com commands a 6.4% share of the aggregator market, while MoneySavingExpert.com and Moneysupermarket.com hold 22% and 27% respectively. Research was also conducted into the websites' marketing spend, the combined total of which increased from £35m in 2006 to £85m in 2009.

More on your contactless

Barclays has welcomed a move to increase the maximum limit for contactless debit and credit card payments in the UK from £10 to £15. The change was made after a request from MasterCard and Visa to bring the UK more closely in line with the eurozone, where the limit is €25

What a great business model - simple , low risk, well done

Coventry Building Society has reported an increase in net profit from £26.4m in 2008 to £56.2m in 2009, while impairments rose by £3.3m to £75m. The society also grew its deposit book by £833m and its number of accounts by over 270,000. Chief executive, David Stewart, noted that the society's strength lies in it executing a 'simple business model without recourse to increased risk'.

Love it or hate it - it's memorable

Halifax's latest 'High Five' TV ads promoting its Reward Current Account have been placed second in Marketing magazine's latest Adwatch rankings, with a 62% consumer recall rating. The magazine also defends the ads, which have been criticised for being 'excruciating' and 'cheesy', for its depiction of staff who are 'regular' and 'having a laugh' - an effective way, it notes, to distract from the brand's problems.

Research on holidays - flawed as it neglects to mention the security travel agents bring....

Santander research has found that of the 25m adults who went on holiday abroad in 2009, 11.6m (47%) saved money when booking their travel and accommodation by avoiding travel agents and tour operators, instead going online or calling directly to make their booking. The most popular money saving method was to book online (44%). A third of holidaymakers reduced costs by contacting hotels and accommodation venues directly, while 17% cent made the most of friends living abroad by staying with them.

DM is NOT the poor marketers media channel...

Labour readies DM focused election campaign

The Labour Party is said to be planning to focus its marketing spend on direct mail in the final two months of its election campaign. It is understood the party has no plans to launch poster activity and will instead concentrate its efforts on direct mail and grassroots campaigning in the build up to the May poll.

According to a report in The Times, Labour has just £4m left to spend on the campaign, half of what was allocated. The campaign budget for this election is just a fraction of the £15m Labour was said to have spent in 2005 and falls well short of what the Conservative Party plans to spend as it looks to win its first general election since 1992.

The Conservatives launched a high profile poster campaign featuring David Cameron last month. The posters proved controversial after the Party was accused of airbrushing the images of its leader to make him look younger. The Tories have since launched a campaign featuring real voters who plan to vote for the Party for the first time.

The Tories received more than £10m in donations to their campaign in the final quarter of 2009, according to figures released yesterday (25 February) by the Electoral Commission, compared with Labour’s £4.9m.

The Times report says Labour will look to exploit free media opportunities such as planned televised debates between the leaders of the three main parties and also plans to advertise in freesheet Metro and Tesco magazine.

DM is NOT the poor marketers media channel...

Labour readies DM focused election campaign

The Labour Party is said to be planning to focus its marketing spend on direct mail in the final two months of its election campaign. It is understood the party has no plans to launch poster activity and will instead concentrate its efforts on direct mail and grassroots campaigning in the build up to the May poll.

According to a report in The Times, Labour has just £4m left to spend on the campaign, half of what was allocated. The campaign budget for this election is just a fraction of the £15m Labour was said to have spent in 2005 and falls well short of what the Conservative Party plans to spend as it looks to win its first general election since 1992.

The Conservatives launched a high profile poster campaign featuring David Cameron last month. The posters proved controversial after the Party was accused of airbrushing the images of its leader to make him look younger. The Tories have since launched a campaign featuring real voters who plan to vote for the Party for the first time.

The Tories received more than £10m in donations to their campaign in the final quarter of 2009, according to figures released yesterday (25 February) by the Electoral Commission, compared with Labour’s £4.9m.

The Times report says Labour will look to exploit free media opportunities such as planned televised debates between the leaders of the three main parties and also plans to advertise in freesheet Metro and Tesco magazine.

Easter Egg Sale

Citigroup is in talks to sell its Egg internet banking business, just three years after buying it from Prudential at the top of the market for £546m. According to people close to the situation, at least one major private equity player has expressed interest.