Russia’s Federal Consumer Rights and Welfare Supervision Service head Gennady Onishchenko began controlling the banking sector.
Photo: Nikita Infantyev
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Consumer Rights Watchdog Probes Bank
For the first time ever, a Russian bank was yesterday charged with effective rate non-disclosure by a state agency. The Federal Consumer Rights and Welfare Supervision Service initiated a case against Russky Standart bank. Its borrowers complained that the bank concealed real interest rates behind covert commissions, which made the real cost of credit reach 400 percent. Bankers think that the case is groundless.
Russia’s consumer rights watchdog said yesterday that it had initiated an administrative violation case against Russky Standart bank. The federal service received complaints from the bank’s borrowers that the bank concealed real interest rates.
In February, there came four complaints from citizens. One said that instead of the declared 29 percent, the credit’s real rate made up 100 percent. Another said it reached 400 percent. The borrowers accuse the bank of hiding the real interest rates behind covert commissions, and of breaching the rules of contract writing, when the declared rate was written in large letters, and the real rate – in small ones.
If the federal watchdog finds the bank guilty, it might issue an order to eliminate the violations. It might also impose an administrative fine of up to 30,000 rubles.
Bankers apprehend that the federal service might begin checking other banks as well. The consumer rights watchdog said it may do it if there are complaints from borrowers of other banks.
www.kommersant.com
All the Article in Russian as of Feb. 27, 2007
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