Bank problems abroad?


When your bank makes a mistake it can be frustrating, especially when banking abroad. Where does one turn when a bank takes advantage and you are thousands of miles away? Often there is help. Learn more from the message sent by our Swiss eClub advisor…

Gary

Dear International Friend,

Last year I made a substantial purchase of bonds at my Swiss bank, Credit Suisse. The bank was going through reorganization and the advisor who had looked after my account for thirty years resigned during the midst of this purchase. After thirty years of perfect service, the quality of administration fell apart, for a time at least. Mail was sent to the wrong address, account advisors kept changing, no one knew what was going on. There was nothing personal about the service at all.

Lack of communication between the changing bank advisors during this period caused the fees on the bond transaction to be $3,500 more than they should. When I pointed this out, no one at the bank wanted to own up. The current account manager refused to do anything about it and treated me, in my opinion, rather badly for even bringing the matter up.

What was I to do? I had written back and forth for almost a year and obtained no results from my advisor. A Swiss lawyer would have cost more than the $3,500.

But I refused to give up. I obtained a list of the hierarchy at the bank that went all the way to the CEO. My plan was to work, one person at a time, right to the top. I began with my advisor's boss who sent a rather cold message which in short said, "get lost". So I climbed the ladder and finally gained results and received a full $3,500 refund. But I spent a lot of time in the process.

But recently when an eClub member asked us about a Swiss banking problem our Swiss advisor Andi Kaegi showed me that there is an easier way. The information below from the Swiss Bankers Association shows how to deal with Swiss bank problems. If you are an eClub member and have problems at some other financial center, let us know. We'll look to see if there is an intermediary there as well.

Metcalf's law says that the power of a networks expands exponentially with its numbers. There are many ways we can use our network here to help one another. One way is to use this site to collect data about bank problems. If you have had a probl4m with an international bank, send us the name of the bank and state the problem. We will keep a record (not of your message) the bank's name and problem. If we see a trend, ie. if one bank keeps popping up or if one type of problem continues to occur, we will alert club members.

Good Investing!

Swiss Banking Ombudsman

An independent mediator between banks and their customers Since 1 April 1993, customers of banks in Switzerland have been able to apply to an independent banking Ombudsman, free of charge. The Ombudsman responds to questions and mediates between customers and the banks in cases of disagreement.

How the office of the Ombudsman is organized The foundation "Swiss Banking Ombudsman" was established in autumn 1992. The foundation’s board, its president and vice president are elected by the Board of Directors of the Swiss Bankers Association. The Ombudsman is chosen by the board of the foundation. On 1 April 1993, the Ombudsman’s office commenced operations for all of Switzerland. At present, the position of Ombudsman is held by Hanspeter Häni.

For whom is the Ombudsman intended All bank customers, but primarily private individuals and small firms which are not very conversant with the banking business.

When does the Ombudsman intervene If a bank customer is unhappy with her or his bank in a specific instance and discussion does not bring about a satisfactory solution, the customer may apply to the Ombudsman. Simple cases are dealt with directly on the telephone. If a case is more complicated, the Ombudsman will need to see the records. The procedure is free of charge for bank customers.

How the Ombudsman proceeds With the agreement of the bank customer, the Ombudsman addresses the bank concerned, requests a statement of its position, and, if necessary, examines the records. After listening to both parties, the Ombudsman will then either present a proposal for settlement or suggest that the matter be turned over to the courts. The Ombudsman serves as an impartial and independent intermediary. His recommendations are not binding. The parties are free to decide for themselves whether they wish to adopt the recommendations or take other steps. The normal periods set by the statute of limitations are neither suspended nor interrupted while the Ombudsman is handling the case.

Queries that do not fall within the competence of the Ombudsman The Ombudsman cannot handle questions of a general nature that do not concern a specific case, cases that involve a foreign branch of a Swiss bank, questions concerning business and pricing policies, such as a refusal to extend credit or the setting of a fee schedule for services, cases in which some other authority is already involved. Contact office in the search for dormant assets The Ombudsman serves as the contact office in the search for assets which have been dormant since 1945. Assets are considered to be dormant if there is no trace of contact with the customer in the bank’s files for the last ten years or more.

Current statistics In 1998, the Ombudsman’s office handled 1'180 cases (compared with 918 in 1997). Of these, 648 (1997: 506) inquiries could be dealt with on the telephone. Of the remaining 532 cases (1997: 412) that were submitted and handled in writing, 458 (1997: 373) could be brought to a conclusion, and 74 (1997: 37) were still pending at the year’s end.

Please contact Banking Ombudsman / Contact Office

Schweizergasse 21
P.O. Box 1818
CH – 8021 ZurichTel.: +41 1 213 14 50 (mediation 08.30 – 11.30 h)
Tel.: +41 1 213 14 60 (inquiries to dormant accounts after 1945)
Fax: +41 1 210 37 20 © Swiss Bankers Association, Basel, July 1999


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