Banks cleared of collusion on charges

Press, 20 October 1987, Page 24

Banks cleared of collusion on charges

PA Walltagton The Commerce Commission has cleared the Bank Of New Zealand and Westpac trading bankjOf collusion over the Introduction of a controversial cash handling fee. Both banks were cleared also of any suggestion bf illegal price fixing under the (Commerce Act, and misleading terms under the Fair Trading Act The investigation was marked* after official complaints that both banks introduced identical charges for handling big amounts of cash, and benchmarks for the fee. The commission was asked also to investigate why letters from both banks to customers explaining the new charges contained tadentical paragraphs. The commission investigating officer who handled the inquiries Mr Geoff Connor, said he had found no evidence to support the allegations and had cleared both banks. “Contrary to what may have been believed there was little evidence to suggest collusion in the first place. “Both banks were able to show separate research papers into the cash-hand-ling fees and separate papers produced at bank board meetings. “It is clear from the investigation that the banks have no case to answer,” he said. It was also found there was considerable delay between the publication of letters to bank customers, suggesting plagiarism rather than collusion. Both banks are charg-

tag commercial noncorporate customers 1250 for every $lOO6 cash de-* CWS National and ANZ trading banks since the commission’s iavattmtiOQ was. first announced.: The Retail and Wbotesale Merchants’ Association’s executive officer,. Michael Bains, who with others lodged the complaint said. retail opposition to the charges would not subside with the findings. . ’ "We’re obviously pleased the banks have not colluded but opposition to cash handling fees is still fierce in the induswill be looking very hard, towards new banks coming, on stream to ,see what their attitudes are towards cash transaction fooft. .. “Large retailers may also like to chat with the Reserve Bank, or security firms but all will be looking at ways of mitigating losses through these fees,” he said. Mr Baines said the full effect of the fees would not be known until end of year balances were done. “It’s going to be substantial for many and could result in staff layoffs for those particularly hard hit unless something is done. ( “The most disturbing aspect with the whole investigation was Hie waste of public money simply because banks are paranoid about secrecy,” Mr Bains said. •