Business Irish

Saturday 30 August 2014

Case of Laurel and Hard-up

Published 09/10/2012 | 05:00

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TAXPAYERS faced with the prospect of stumping up for the payment protection insurance (PPI) scandal will recall Oliver Hardy's catchphrase: "Well, here's another fine mess you've gotten me into!"

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This latest fine mess is likely to cost €600m, with much of the cost falling on the taxpayer. No wonder many believe that with each passing day our banking crisis is starting to resemble a bad storyline out of a Laurel and Hardy movie.

AIB, EBS and Permanent TSB are just three of the lenders caught up in the controversy, but these three are state-owned and bust.

This means the ultimate cost of the PPI mistakes made by these three will fall on us taxpayers. As many as 70,000 people are likely to be getting refunds after they were mis-sold PPI policies over the past five years.

The probe into seven financial institutions has been widened to include other institutions. That means this fine mess has the potential to get even bigger -- the estimated €600m cost of cleaning up the scandal could mount.

It is lucky for banks, but not for consumers, that the statute of limitations means people with a claim could be time-barred from getting a refund. The limit is six years "from the date on which the cause of action accrued", according to the law.

Irish Independent

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