Dr Julian Lewis: I beg to move that leave be given to bring in a Bill to require banks to adopt and maintain specific practices in dealing with vulnerable elderly clients at risk from certain financial arrangements by institutions and from other forms of exploitation by individuals.

This Bill would have three provisions. The first is to ban ATM cash machine charges for pensioners who are in the process of gaining access to the accounts in which they are now obliged to receive their pensions.

The second is that banks that operated the ill-fated Share Appreciation Mortgage schemes in the 1990s, which left elderly people unable to sell their homes without giving three-quarters of the increase in their value to the banks, should be declared inequitable. The debt should be rescheduled to impose only a reasonable rate of interest on those loans.

I have a direct interest in the third provision, which is that banks should have in place software which will automatically alert account managers, cashiers and, where appropriate, relatives and carers of elderly people, to untypically large or frequent withdrawals being made from a vulnerable client's account – irrespective of whether they are made personally by the account holder. The purpose is to improve safeguards against the activities of conmen and other criminals who prey on the vulnerable and the suggestible.

The first provision is self-explanatory. It has been pointed out to me by Terry Cassels, the Chief Officer of Age Concern in Essex, that some cash machines charge as much as £5 per transaction for a pensioner to withdraw his or her own pension. That can amount to approximately 5 per cent. of what they receive. That is obviously unsatisfactory. It results from the bringing into being of a system that many pensioners did not want in the first place, and I would have thought that it should be made a condition of any cash machine being placed in a bank, whether owned by the bank itself or by another company working within the bank, that pensioners be exempted from any such charge.

The second provision of my Bill is more complex. Shared Appreciation Mortgage schemes were offered between April 1996 and July 1998, by Barclays Bank and the then Bank of Scotland, which subsequently merged with the Halifax. About 15,000 people remain trapped in those arrangements.

I shall give some examples, without identifying the people concerned, from among my constituents. Mr C. borrowed £44,000 in 1998, but must pay back £180,000 only six years later. Mr T. borrowed £36,000 in 1998 and must now pay back £152,000. Such massive repayments arise from the nature of the gamble that people took in embarking on these schemes. Instead of paying an agreed rate of interest on the loans, borrowers undertook that three-quarters of the increase in the value of their property when it was sold – either by them or by the people to whom they left it – would go to the bank in lieu of interest.

We all know what happened – the value of houses shot up. As a result, the sums that must be repaid are grossly disproportionate to what a reasonable interest rate would have required. The daughter of another of my constituents, Mr B., said that

"surely if a lending company were to charge this they would be considered to be a loan shark and would be treated accordingly. I find it impossible to believe that a High Street bank can carry on in this manner".

I wrote to the Barclays Bank Group Chief Executive, Matthew Barratt, suggesting that the bank might surprise me, agree to reschedule the loans, and make available to the borrowers interest requirements proportionate to the amount of money borrowed. Sure enough, I got nowhere. I was told that the people involved had taken a risk and that the bank's shareholders could have lost out because the value of property might not have risen. The fact that new Financial Services Authority rules meant that such schemes would not be allowed was never mentioned, nor the fact that the schemes were wound up after only a couple of years.

Another factor needs to be considered. It is a falsehood for the banks to say that they did not know that property values were likely to rise. I am grateful to Miss Margaret Borwick, a specialist in these matters, who sent me a copy of an article which appeared in the February 1997 edition of the publication Housing Finance, which is the quarterly digest of the Council of Mortgage Lenders. The article shows that the value of property was forecast to increase by 9 per cent. in 1997, and by 7 per cent. in 1998. Both Barclays Bank and the Bank of Scotland were members of the Council at the time.

I come to the third and final provision of the Bill. I refer to an Adjournment debate which I held on 11 December 2003, about the activities of Mr Paul Grey, a rogue builder in Swansea who managed to fleece my father out of £7,500 in cash withdrawals for building work which was never done. Subsequently, he admitted to me in a late-night telephone conversation laced with anti-Semitic abuse that he had been doing that sort of thing for 20 years and that there was nothing that people like me could do about it.

My proposal is simple, and has to do with the arrangements currently used by credit card companies to cover the situation when a person – like myself, or you, Mr Deputy Speaker, or any other hon. Member – makes an untypically large withdrawal from an account. Straight away, we receive telephone calls asking us: "Was that really you? The amount being withdrawn seems untypical."

A similar arrangement should be in place for vulnerable elderly customers at risk of being conned by rogues like Paul Grey. I warned Lloyds Bank in Swansea that I was afraid that my father would take out money to pay a builder when he should not. When such a warning is given in other cases, it ought to alert the people running the relevant branch that an untypical payment might occur.

I have had extensive argument and consultation with Lloyds Bank on the matter. Although staff made a note on the bank's computerised database that they would ring me if they suspected that something was going on, they failed to do so because no automatic mechanism existed to alert tellers or initiate the warning process when my poor father started to withdraw money.

A recent agreement has tried to make banks and cashiers more alert to the dangers posed by conmen. However, I am not satisfied, from my dealings with either Lloyds Bank in the one case or Barclays Bank in the other, that banks can be relied on to act without being forced to do so. That is why I have brought forward the Bill and I commend it to the House.

Question put and agreed to.

Bill ordered to be brought in by Dr Julian Lewis, Mr Nigel Evans, Mr Martin Salter, Andrew Selous, Mrs Alice Mahon, Michael Fabricant, Mr Mike Hancock, Mr David Amess, Mr Gordon Marsden, Mr Desmond Swayne, Mr David Chidgey and John Robertson.

[As a Ten-minute Rule Bill, this cannot proceed further.]