Source: Daily Telegraph

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'Cash martyr' takes BT to court for fees

By Harry Wallop, Consumer Affairs Correspondent
Last Updated: 3:31am GMT 13/02/2008

A solicitor is taking BT to court over the charges the telephone company levies on customers who pay their bills by cash.

* Why are cash customers penalised?

Ros Fernihough, 62, who has been dubbed the "cash martyr" by her supporters, claims the company is unfairly penalising her for refusing to pay her bill by direct debit.

Mrs Fernihough, like 5.5 million fellow BT customers, chooses not to pay by direct debit. As a result her monthly line rental costs £13.25 a month, compared to £11.75 a month.

She said: "On a £10 note, it says quite clearly 'I promise to pay the bearer on demand the sum of 10 pounds', not '10 pounds, plus a £1.50 handling fee'. This is not a spurious claim. BT's position won't wash."

The grandmother of seven said she has paid her telephone bill in cash ever since she became a BT customer in 1964. She goes to the local branch of her bank in Sutton Coldfield and either pays in notes and coins or by transferring cash electronically to BT's account.

Since May last year, BT has levied a £1.50 handling charge on cash or cheques; the company insists, however, that direct debit customers have always enjoyed a discount on their line rental, but it is not made clear on their bills.

Mrs Fernihough said: "I don't care whether BT calls it a charge or a discount. They are charging extra people who use the Queen's currency."

Mrs Fernihough is bringing the case under the Unfair Terms in Consumer Contracts Regulation of 1999, the same regulation under which bank charges are being considered by the High Court.

The case will be heard next month at Walsall County Court. District Judge Hearne has already ruled that her claim is "of considerable public importance".

If Mrs Fernihough were to win the case, it could force companies to lift the charges that they levy on customers who pay by cash.

BT insists its charges are "fair and legal". A spokesman said: "We will be defending the case."

Mrs Fernihough is one of many readers who contacted The Daily Telegraph to call for an end to charges after last week's story highlighted how customers who paid their bills in cash had to pay an extra £300 each year.

Gas and insurance companies, as well as telephone companies, charge substantially more if their customers take a standard policy rather than an online account.

David Miller, a property manager and another reader, said he was backing Mrs Fernihough's legal bid.

He said: "Good on her. I will stand outside the court waving my 'Free the Cash Martyr' placard if needs be."

Henry Katz, an independent financial adviser, said: "I don't like direct debit. I pay my bills by electronic transfer on time every month. Utility companies do not have to handle any cash or cheque. And yet they still charge me more. Why?"

Campaigners argue that elderly people are particularly hard hit. David Sinclair, Help the Aged's policy director, said: "For older people access to cash is vital. Chip and pin and the internet, have made access to cash more difficult and many people are struggling to cope."

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See also an interview with Ms Fernihough on BBC Breakfast here. They quite rightly point out that whilst BT charges £18 per year for non-Direct Debit payments, Virgin Media charges £60.

I note Ros Fernihough is a solicitor. Is there any solicitor in the country who would take on BT on behalf of the millions of customers who object to having a gun pointed to their heads saying : Pay by Direct Debit or else".
Whatever happened to customer care?
Is the customer and his opinion of no interest to BT?
Like Hanry Katz, I pay on line direct to BT's bank - thus incurring no additional cost to BT than paying by DD.
I have had an admission from a BT employee that that is the case - no extra cost involved by BT - so why the charge?

I think VirginMedia should be top of the list as they charge an extra £5 per month last I heard (£60 a year) for those not paying by direct debit.

I am delighted to hear that someone is taking BT to task over their unfair charges. I asked for information about how they arrived at this £1.50 per month charge over a year ago, and got a pathetic answer saying that others do the same so it's OK.
I have refused to pay it, I deduct it from the bill and pay the balance, and so now incur a late payment charge in addition, which I also refuse to pay. As I do not use BT to make calls (only for line rental), this 'late' payment charge actually relates to 'advance charges - BT charge in advance for line rental, so it is not 'late' at all. Another unfair practice that should be outlawed too in my opinion.
Am I right in think that BT now charges a connection fee for every call made? It used to be a minimum charge, it seems it's now an extra fee. I found a note to this effect tucked away in the small print on the last page of their BT Update booklet that came with my last bill. Is this another hidden extra that has gone unchallenged or have I misunderstood them?

Quote:


Yes you are right.  Since 1 August 2007 there has been a 6p call setup fee. Furthermore, from 1 April 2008 daytime call charges to geographic numbers will go up from 3.25p/min to 4p/min (a 23% increase).

Further to the suggestion that fighting against Direct Debit is a luddite action, I have had 2 bad experiences with DD whereby firms took a larger amount than they should have done and had not notified me in advance.
The actual wording of the mandate in effect says " 'x' company can take what they like when they like from my bank account". In other words you give 'x' company control of your bank account.
I have no objecvtion to Standing Order whereby I say "I will give you x amount when I say - eg every month".
That way I keep control of my bank account.
I do not trust banks and their guarantees.

As stated, I have had 2 bad experiences with DDs where companies took more money without notifying me.
As you say it is the companies who generate the amount - ie they can take what they want out of my account. Ie also the company has control of my bank account.
As stated I do not trust bank guarantees.

Barbara wrote on Feb 23^rd, 2008 at 2:23pm:


I have around 12 direct debits taking monthly payments and have never had any trouble with them.  Those of you who seem to fear anything that stops you initiating the payment yourselves need to check the terms and conditions of the direct debit scheme.  If for any reason the payment taken is not correct they have to return it based on your say so even if the retailer doesn't like it.  The retailer then has to try to recover the returned money from you directly if they still believe it is owed.  Also if you do not generally use direct debit do you not then find yourself being hit with penalty fees when you overlook initiating a manual bill payment sooner or later?

However what you should avoid at all costs is setting up continuous credit card authorities as these actually do have all the pitfalls that you and others in the forum wrongly seem to believe apply to Direct Debit.  With a continuous credit card authority you cannot stop it and you must persuade the merchant with your card details to cease taking the payments.  Also very strange things happen with these continuous credit card authorities carrying on even when you change the card number to try to stop such fraud.  Online payment by Switch is also again similarly not recommended because it is in effect like using cash and cannot be put in dispute.

Also Barbara without wishing to appear critical a number of the payment errors you are experiencing is surely because you are relying on fallible bank/building society human beings to rekey your data and they periodically make mistakes.  Whereas if you use online banking you set up the payment and enter the details and it is therefore much less likely that a mistake will occur.  I used to have endless trouble with the Inland Revenue getting things wrong in calculation till I started submitting the data directly online myself and thus cut out the possibility of data keying errors.

I agree with you about Nationwide being entirely preferable as a banking organisation to the sharks at NatWest, HSBC and Lloyds TSB etc.  It is worth switching to Nationwide for the fee and commission free overseas debit card cash withdrawal and the foreign exchange rate levy free Visa Credit Card.