Eleven French banks fined in price fixing case
The French competition watchdog Monday fined 11 banks EUR384.9 million for colluding on charging unjustified fees on checks and other interbank services.
The watchdog said the banks colluded to apply a EUR0.43 fee on 80% of checks exchanged in France between January 2002 and July 2007, during a transition period toward a new digital system for processing checks.
"When the new digital system for processing and clearing interbank checks was set up, the main French banks met and colluded so as to define together the functioning details of the new system," L'Autorite de la Concurrence said in a statement.
The fees cost customers an additional EUR220 million during this period, the watchdog said.
The banks fined include Bank of France, Groupe BPCE, BNP Paribas SA, Confederation Nationale du Credit Mutuel and its Credit Industriel et Commercial SA unit, Credit Agricole SA, Credit Agricole's LCL unit, HSBC Holdings PLC (HBC), Banque Postale and Societe Generale SA, along with Societe Generale's Credit du Nord unit.
Checks are among the most popular forms of payment in France, despite being increasingly supplanted by card payments.
Interbank card charges are part of a separate investigation, with the competition authority expected to publish its decision in 2011. The Federation Bancaire Francaise, the French banks' association, wasn't immediately available for a comment.
Maxime Chipoy, a spokesman for French consumer rights association UFC-Que Choisir, welcomed the fine, pointing out that there remains little transparency for bank charges. "In general, consumers don't know the legitimacy of charges practised in the banking sector," he said.
Banks in France have been required by law since January 2009 to publish a yearly round-up of all the fees they charge and send it to every customer.
According to a study by UFC-Que Choisir, the average brochure is 24 pages long and includes more than 300 fees for different types of transaction.
Finance Minister Christine Lagarde said in March that an independent investigation would be launched into the fees charged by banks after an EU study found French banking fees lacked transparency and that information provided to customers was often incomplete or incomprehensible.
BNP Paribas, France's largest bank by market capitalization, was fined EUR63.3 million, while Credit Agricole was fined EUR82.9 million. Bank of France was fined EUR350,000.
All banks can appeal the watchdog's decision.
Source: Dow Jones Newswires
Date: 20.09.2010 [ID: 265]