Wednesday 28 September 2016

Mortgage scandal: watchdog knew six years ago

Charlie Weston Personal Finance Editor

Published 08/08/2015 | 02:30

The Central Bank
The Central Bank

The State's leading watchdog was warned six years ago about the scandal of banks like Permanent TSB trying to take valuable tracker mortgages off homeowners, the Irish Independent can reveal.

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The then-Financial Services Ombudsman wrote to the Central Bank in 2009 calling for a probe across all of the banks. A year later, the ombudsman found against Permanent TSB in the first of the current cases.

He was concerned over attempts to deny mortgage holders the option to return to their trackers after being on fixed rates - the same issue that has arisen at Permanent TSB. But the Central Bank waited years before acting on the issue.

Almost 1,400 people were wrongly denied good-value tracker rates by Permanent TSB. An investigation has found the lender's failures were a key factor in the loss of ownership of at least 22 properties.

The issue has forced Permanent TSB to launch a multimillion compensation scheme.

However, the High Court heard yesterday that a couple must accept the bank's "derisory compensation offer" of €6,000 before it will repay €61,000 it overcharged them on their mortgage.

Irish Independent

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