OFT to probe investment banks on fees

COMPETITION watchdog, the Office of Fair Trading (OFT) said yesterday it intends to scrutinise investment banks over the fees they charge clients.

Chairman Philip Collins told members of the Future of Banking Commission the OFT will launch an investigation into the sector in the coming months.

Collins said the OFT was keen to find out more about investment banking services and charges.
Vince Cable, Treasury spokesman for the Liberal Democrats and a panel member of the committee, said there is real concern about high profit margins at investment banks.

He said: “There is growing concern about the way in which the investment banks are racking up enormous fees on what seems prima facie [evidence] to suggest semi-cartel-type behaviour.”

Collins spoke to a committee of high-profile banking and government figures currently working together to examine how to improve the financial services industry in the wake of the global recession.

The committee, which is chaired by Tory MP David Davis will present a report to the government after the elections.