Destitute in Dubai: One man's story

Nicholas Warner: "This place changes people"
It was six o'clock in the morning when I met Nicholas Warner down by the Dubai Creek and already the temperature was 35C. We both knew that in a few hours it would climb to nearer 50C.
He eagerly showed me to a bench shaded by a palm tree that faced the waterfront so we could talk without getting burnt.
"Is this where you're sleeping at the moment?" I asked.
"Oh no," he replied. "It's not like England. You can't lie down on a bench and just sleep. You have to prop yourself upright and nod off or you'll attract unwanted attention or get moved on. I sleep on the ground behind that hedge, when I'm here."
And when he's not there?
"I started off in my car - but it's too hot for that now - you'd bake. Obviously, I can't afford petrol to keep the air con running.
"Then I was under a bridge. There's been a few days in a car park at a hotel. The manager there kindly took my clothes off me sometimes and washed them. He also let me use the shower after a guest checked out of a room."
But that all stopped when the hotel manager lost his job.
"So now I'll be back to washing in the public toilets."
'Debt skipper'
Nicholas Warner is British and sleeping on the street in Dubai. He got into a dispute with his bank, Emirates NBD, initially over whether his credit card repayments had been made.
He went on holiday at Christmas and the bank says that by leaving the country without its permission while they were in a dispute, he got reclassified as a so-called "debt skipper" - one of the many expats who left Dubai in a hurry with large debts, never to return.
Of course, Nicholas did return. When he arrived back at Dubai airport, he was arrested. His passport was seized by police on the authority of the bank.
Although he was released and tried to negotiate with the bank he got into further difficulties.
Brushes with the authorities are frowned upon in Dubai.
He had been working as a strategy adviser for an alternative medicine company, but his employer decided it was safer to let him go while he sorted everything out.
Now he had no job, no way to pay the debt the bank was demanding and no passport - leaving him with no way home.

'Without my wife'
The complex ins and outs of what happened next would fill a book. Emirates NBD - the largest bank in the Middle East by assets - says it tried to negotiate a settlement with him that he reneged on.
Nicholas says what was orally agreed was not what the bank wrote down on paper.
Either way, Emirates NBD is refusing to let his passport be released until the debts are paid. Nicholas has no way of paying them without a job. And he cannot get a job without being able to show he's in the country legally. For that, he needs his passport.
"I've said to them, I've not got that sort of money that I just do that," he says, clicking his fingers.
"Because if I did, I would. There is no way I would not want to be with my wife for four months and be living rough, hoping that someone gives me their sofa and that the bank or the embassy come up with something.
"If I had that money, I would pay it."
Emirates NBD was unwilling to discuss the specifics of the case with the BBC.
In a statement it said: "All actions by the bank in this matter have been in accordance with prevailing UAE laws, and in line with the contractual agreement signed by the customer who was unable to meet his commitments and approach the bank for appropriate settlement of his dues."
Rising temperatures
Four months ago, Nicholas sold all the furniture in his house and took the money to the bank. It was just enough to cover the £6,000 the bank said he owed at that time.
The offer was rejected. Nicholas says he was told that with interest and charges, he now needed to pay nearer £11,500.
With no furniture in their rented house, Nicholas told his wife it would be safest for her to leave the country while she still could. She returned to her native Spain.
For a while, Nicholas was able to rely on friends letting him stay in their spare rooms or on their sofas.
But as time dragged on, they became worried that they might get embroiled in his predicament.
Which is how he ended up sleeping rough. As summer moves on, temperatures are set to rise still higher in the Emirate.
Nicholas hopes desperately that he won't still be on the streets in August. With no job, he has no medical insurance. If he gets ill, he's on his own.

Brits waste £150m on credit card fees

Every year British consumers waste £150 million on late payment credit card charges, Confused.com has revealed.
Research by the price comparison site found one in four (26%) credit card holders have been charged at least once in the last 12 months for missing a late payment.
Nearly one in 11 (8.5%) have been charged three or more times in the same period.
At an average of £12, late payment charges can quickly stack up.
Meanwhile, over half (57%) of credit card holders do not have a direct debit set up to pay off the minimum amount. Confused.com encouraged credit card holders to rectify this.
“Collectively we’re wasting millions of pounds each year on these charges, money which would be better spent elsewhere in these tough financial times,” said Alex Higgs, spokesperson for the price comparison site.
“Setting up a direct debit to make a minimum payment on a credit card is such a simple thing to do, yet well over half of credit card holders haven’t done it,” he added.
“We would encourage anyone without a direct debit set up to get one in place.
“Not only will this save money on charges and help contribute to a healthy credit profile, it will allow money that would have been spent on charges to be used to repay more than the minimum amount, saving more money as interest charges are reduced.”

Credit card defaults, late payments dip in June

Consumers are getting a handle on their credit card payments, data on defaults and late payments shows.
Five of the top six U.S. credit card issuers on Thursday reported declines in June charge-off rates, the unpaid balances they gave up on collecting.
Only Citibank, the nation's second largest issuer with roughly 90 million cards in circulation, said writedowns and late payments increased last month. Citi's charge-off rate rose to 11.46 percent of balances, up from 11.16 percent in May. Delinquencies, or payments that are 30 days or more past due, reached 8.58 percent at Citi, up from 8.42 percent in May.
Citi has the highest delinquency rate and second-highest default rate of the six banks.
The biggest improvement was reported by Chase, which has about 120 million cards in circulation, making it the top issuer in the U.S.
Chase posted a greater than 1 percent drop in charge-offs, to 8.3 percent of balances, and a more modest decline in delinquencies to 4.3 percent in June, from 4.38 percent in May.
JPMorgan Chase CEO Jamie Dimon said in a conference call to discuss the bank's second-quarter results earlier Thursday that the charge-off rate is expected to keep improving. But he added it will take some time because of the sluggish economy.
Credit card defaults are improving, even given the sluggish economic recovery, for several reasons.
One reason is that much of the bad debt has already been written off — the Federal Reserve said the industry's charge-off rate was just short of 10 percent of balances for the first three months of the year. That came after banks wrote off about $35 billion in unpaid balances last year.
Removing the debt that won't likely be collected has helped make the remaining balances more resilient, said Jeff Hibbs, an analyst with Moody's. "A lot of weaker borrowers are charged off, leaving behind pools of stronger borrowers," he said.
Tighter lending standards also play a factor in keeping defaults down. Banks stopped lending to a broad swath of riskier customers in 2007, Moody's analysts noted earlier this week. Consequently, the cards that are in circulation have been given to people who are more likely to keep up with their payments.
Banks also slashed credit limits on existing cards last year, in part as a response to new regulations that restricted interest rate increases. That means there's less money available to borrow.
Credit reporting agency Experian on Thursday said available credit on revolving accounts — mostly credit cards — dropped to $3.28 trillion in the first quarter, significantly lower than the $4.46 trillion available in the first quarter 2008.
Experian business consultant Kelly Kent said the lower level reflected all of these elements: tighter standards, limit cuts and charge-offs. It's notable that balances have declined at a slower rate than available limits, he said.
Still, Moody's analyst Matias Langer said the improvements seen in the second quarter were not as large as they had forecast. The agency expects charge-offs to remain higher than delinquency rates through the end of the year, staying at about 10 percent industrywide.
Discover said its charge-off rate fell to 8 percent of total balances, in June, from 8.82 percent in May.
Bank of America's charge-off rate dropped to 11.98 percent, from 12.7 percent the month earlier. American Express said its rate dropped to 5.7 percent in June, from 6.3 percent in July.
The smallest improvement was posted by Capital One, which said its charge-offs fell to 9.3 percent of balances in June, from 9.5 percent in May.

Bank of America credit write-offs drop in June

Bank of America on Thursday said the credit card balances it wrote off as uncollectable in June fell for the third straight month. Like other companies that offer credit cards, the bank also said past-due payments dropped to their lowest point of the year.
In a regulatory filing, Bank of America said its charge-off rate dropped to 11.98 percent of balances, from 12.7 percent in May.
Card companies typically write off loans after they're 180 days past due, the point at which it's assumed the balances won't be collected.
In the past year, banks have written off a record amount of loans as customers struggled to pay. By the first three months of this year, the charge-off rate was just short of 10 percent of balances. That compares with a rate of 3.8 percent in the second quarter of 2007, before the recession began.
Bank of America is the among the top three U.S. banks for credit cards, with about 80 million cards in circulation, according to the Nilson Report, an industry newsletter.
Bank of America said the rate of late payments has fallen to its lowest point of the year, 6.16 percent in June, from 6.39 percent in May. That's a sign that the debt burdens felt by card holders over the past two years is beginning to ease.
In afternoon trading, Bank of America shares fell 56 cents, or 3.6 percent, to $15.11.

US Fed Restricts Two Banks, One Of Which Received Bailout Funds

WASHINGTON -(Dow Jones)- A New York bank that received $7.5 million in government bailout funds has been ordered not to pay dividends or incur new debt without the Federal Reserve's approval.
The Fed on Monday released a written agreement imposing the restrictions on BNB Financial Services Corp. (BNBF). The agreement also requires BNB, which runs BNB Bank in Fort Lee, N.J., to provide the central bank with regular progress and cash flow reports.
BNB is among dozens of so-called healthy banks that received money from the government's Troubled Asset Relief Program and are the subject of enforcement actions by banking regulators. Enforcement actions typically signal regulators' growing concern about a bank's health or management.
BNB received its $7.5 million in April 2009.In a separate enforcement action released Monday, the Fed placed similar restrictions on Smithtown Bancorp Inc. (SMTB), based in Hauppauge, N.Y.
Smithtown, which bills itself as the largest independent commercial bank headquarted on Long Island, is not a recipient of TARP funds. It has, however, been struggling against a growing volume of soured real-estate loans

Credit Card Debt Relief Now Widely Available

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Other sobering statistics: Total U.S. revolving debt (98 percent of which is made up of credit card debt): $852.6 billion, as of March 2010 (Source: Federal Reserve's G.19 report on consumer credit, March 2010). Total U.S. consumer debt: $2.45 trillion, as of March 2010 (Source: Federal Reserve's G.19 report on consumer credit, May 2010).


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