Tuesday 30 May 2017

Tracker-scandal bankers should be named, shamed and fined

There are increased obligations for companies retaining data, restrictions on how it can be shared and stronger rights for European citizens
There are increased obligations for companies retaining data, restrictions on how it can be shared and stronger rights for European citizens
Charlie Weston

Charlie Weston

One can only imagine what it is like to lose your home. It must be the nearest thing to a death in a family. To be uprooted from a place that is familiar and yours, that has been shaped to your liking and that holds deep personal memories, must be a nightmare.

And how much worse must that situation be if the loss of your home is due to the actions of your bank, which blatantly over-charged you?

You now know that you would have kept your home, even though finances were very tight, if it was not for the wrongful acts of your bank.

That must be really galling. And for your troubles, what do you get? The over-charged interest payments are refunded to you. And a measly few grand in compensation to make up for the inconvenience.

The Central Bank has ordered all banks to conduct their own probes of their mortgage books to identify customers wrongfully denied low-cost trackers.

A year later banks are still going through their books. So far no banker has been named, none is shamed. We don't know if the over-charging was deliberate policy, or an administrative error. One lender, Permanent TSB's sub-prime subsidiary Springboard, has been fined.

But it does seem that the tracker mortgage denial was systemic in the Irish banking system.

Some 51 families lost their homes as a result of banks wrongfully denying them their good-value tracker rates, when they decided to go on to a fixed rate for a short period.

Ulster Bank admitted last week that 15 customers lost homes due to the tracker denial scandal. That is in addition to 14 at AIB, and 22 at Permanent TSB.

In total, Permanent TSB had around 1,400 tracker-denial cases, with excess of 2,000 each at AIB and Ulster Banks. The other banks have yet to own up.

But if 22 people lost their homes as a result of the actions of Permanent TSB, how can the figures for AIB and Ulster Bank be so low, given they have more tracker denial cases than Permanent TSB?

Permanent TSB compensated people who lost homes as a result of its actions. However, a few thousand euro in compensation cannot make up for losing a home.

People who lost a home due directly to the over-charging by a bank should have new homes bought for them by the same banks.

Fines are all very well, but bank executives also need to be pursued by the Central Bank over the tracker scandal. How about naming and fining individuals who took the decisions to outrageously and incorrectly deny people their right to have a tracker? It is high time the watchdog bit - and bit hard.

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