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Saturday 20 September 2014

Irish banks not listening to customers - ombudsman

Charlie Weston Personal Finance Editor

Published 21/08/2013 | 05:00

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Mr Kielty said the Government must ensure that steps are taken by the Central Bank to protect small businesses
Bill Prasifka

BANKS have been heavily criticised for not listening to customer complaints and dealing with them.

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The ombudsman's office received 4,676 complaints in the first half of this year, up 27pc on the same six-month period last year.

A third of all complaints to the ombudsman in the first half of the year were about banks.

And the main issue for customers are disputes between homeowners and banks over how to deal with mortgages that are in arrears - it is one of the top grievances, according to the financial ombudsman.

People who are unable to meet their full mortgage repayments are increasingly ending up in dispute with their bank, ombudsman Bill Prasifka said.

They complain that they were not listened to properly when they outlined their financial circumstances to the bank, or that the bank's offer to restructure their mortgage would not work for them, he said.

Close to 100,000 residential mortgage accounts are three months or more in arrears.

The Central Bank has ordered six of the leading banks to offer solutions to at least half of their mortgage holders who are in arrears by the end of this year.

Mr Prasifka (inset) said he saw rows over how banks were treating people in arrears as an "endless source of complaints" for his office.

The Financial Services Ombudsman is a statutory officer who offers a free dispute-resolution service for consumers at odds with a financial institution. There was a 51pc rise in complaints about mortgage arrears issues and tracker mortgages in the first half of this year.

Arguments over whether homeowners are entitled to go back on to a low-priced tracker mortgage after being on a fixed rate continue to flood into Mr Prasifka's office.

He said it was hugely important to people as some of those who argue they are entitled to revert to a low-interest tracker may not be able to meet their mortgage payments if they are refused the tracker rate.

"It could mean the difference between a person's mortgage being sustainable and unsustainable," he said.

One in five complaints is settled between the bank or insurer without the ombudsman adjudicating.

Mr Prasifka said there was a need for banks, in particular, to resolve more cases before ending up with his office. There has been a massive increase in complaints about bank accounts, involving direct debits not being paid or money going to the wrong accounts.

New powers are due to be granted to the ombudsman from September that will allow him to name and shame the worst banks and insurance companies when it comes to dealing with complaints.

A league table listing the worst offenders is likely to be issued by next February, Mr Prasifka said.

Irish Independent

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