Banks and microfinance institutions no longer have the right to charge fees for loan processing in a percentage amount and without showing the actual costs, and the Central Bank must protect consumers with its measures, a lawyer from the Center for Consumer Protection (CEZAP) told "Vijesta" yesterday. Miloš Vukčević after the judgment became final, which prohibited the Crnogorsk Commercial Bank (CKB) from setting a percentage fee "for loan processing" to consumers, but that it must be a fixed amount and correspond to actual costs.
He sent a letter to the Governor of the Central Bank yesterday Irena Radović, by which he requests that the CBCG, in accordance with the judgment, take measures within its jurisdiction so that not only the CBCG but also other banks stop illegally calculating and charging loan processing fees.
On March 20, the Higher Court in Podgorica confirmed the verdict of the Basic Court in Podgorica from November 18, 2022, which established the illegal calculation of this fee, while the CKB's appeal was dismissed as unfounded.
The judgment states that there was a violation of the principles of conscientiousness and honesty when it comes to the collection of fees for loan processing, because the bank does not show the nature of the fee it charges from consumers and the costs covered by that fee.
"The commission for loan processing is a fee that essentially compensates the administrative costs of the business performed by the defendant in the loan processing procedure, so in the opinion of the court, it is necessary to charge this fee exclusively in the amount of actual costs, which is not possible if it is charged in a percentage amount depending on the value of the approved loan", the judgment stated.
Lawyer Vukčević told "Vijesti" that the CKB is obliged to act on this verdict within 15 days of its finality, that is, that period has started to run.
"This judgment of the Basic Court in Podgorica, which is now binding on the defendant CKB banka, prohibits the bank from specifying a loan processing fee in the contracts it offers to consumers as a percentage, depending on the amount of the loan being approved. Also, CKB Bank is prohibited from such or similar behavior in the future. At the same time, the judgment establishes that the defendant bank violated Art. 102 st. 1 of the Law on Consumer Protection, setting a fee for loan processing in the amount of 1%, or 1,7% of the amount of the approved loan, which also violated the collective rights of consumers," Vukčević said.
He states that in the letter, the CBCG indicated that this judgment is not only binding for the defendant CKB Bank, but also for other banks, and that the CBCG should take measures within its jurisdiction to protect users of banking services.
"All other banks, as well as microcredit financial institutions, contract the fee for loan processing in the same or similar way, which you can see for yourself by looking at the official tariffs of all the mentioned entities. Therefore, it is very important to note that para. 3 of the sentence of the judgment to the defendant CKB bank, but also to other banks and other financial institutions, prohibits such or similar actions in the future, which means that all banks must organize their operations in a way that will not be contrary to Art. 102 st. 1 of the Consumer Protection Act and this judgment. Taking into account the role of the CBCG, which is primarily responsible for the control and supervision of the work of banks, I called on Governor Radović to take all the actions and measures within her competence so that this judgment is fully applied not only by the defendant CKB Bank, but also of all other banks operating in Montenegro", said Vukčević.
He says that banks should not be allowed to violate the rights of consumers, "especially not now when such a violation has been established by a binding and final judgment of the court."
In a letter to the Governor of the CBCG, Vukčević states that the Court prohibited the bank from such and similar actions in the future.
"This means that you need to ensure that your institution, which supervises the operations of banks, checks with particular care that the CKB, as well as other banks and other financial institutions, do not replace their previous actions, when it comes to these fees, with a similar one that they will continue to violate the collective rights of consumers. As an example of such, also illegal behavior, we would like to mention the recent behavior of some of the banks, which misleadingly offered and contracted fees in absolute amounts, but which amounts in their entirety represented a faithful representation of the same percentage determined fee and thus in practice violated the position in the same way 1, Article 102 of the Law on Consumer Protection, which is precisely the subject of the above-mentioned final verdict", stated Vukčević in the letter.
In this paragraph it is written: "A contractual provision that was not individually negotiated is considered unfair if, contrary to the principle of conscientiousness and honesty, it leads to an imbalance in the rights and obligations of the contracting parties to the detriment of the consumer".
Vukčević: Citizens can sue for the return of illegally charged fees
Vukčević also states that we can now expect lawsuits from citizens from whom banks have so far charged a fee for loan processing in percentages and without showing the actual costs to which it relates.
"It is also important to point out that the above-mentioned final judgment of the Basic Court in Podgorica, issued as a result of a collective lawsuit, confirms that banks have been illegally confiscating funds from citizens for years in the name of fictitious loan processing costs, which the banks did not have, nor could they prove in the proceedings, therefore, citizens now have the right to demand the nullity of such unfair contractual provisions and the return of funds with legal interest from the banks on the basis of unjust enrichment", said Vukčević.
Bonus video:
