Monday 16 October 2017

Central Bank finally acts for the consumer

The Central Bank
The Central Bank
Charlie Weston

Charlie Weston

Permanent TSB folded yesterday and decided to stop fighting in the Supreme Court on the issue of restoring customers to tracker rates.

Some 2,000 of its customers felt they were entitled to revert to cheap tracker mortgages.

They argued, and the financial services ombudsman upheld two cases, that they were promised they could revert to tracker when they came out of fixed rates.

In some cases, the failure to get a tracker means a cost difference of around €700 a month - this is the gap between the tracker repayments and the variable rates they ended up on.

Permanent TSB took the ombudsman to the High Court and lost. It then took a Supreme Court case, which was due to be heard in days. Now it has withdrawn that Supreme Court case.

And the reason? The Central Bank is taking enforcement action against the bank over the tracker denial issue.

At last, the Central Bank has decided to take up the case for consumers.

It has a dual mandate of prudential protection, which is about protecting the banks from collapse, and protecting consumers.

This journalist was pilloried by the Central Bank in a detailed letter recently for questioning its commitment to consumer protection, but the fact remains that the Central Bank has been almost silent when it comes to standing up for the man and woman on the street.

The Central Bank maintains that it takes its consumer protection role seriously.

Whatever the case, other banks will be worried now.

More than 10,000 people who lost trackers will have a reasonable expectation of having them restored, and a windfall for their years of overpayments.

It is a good day for consumers.

Irish Independent

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