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Monday 26 August 2019

Banks accused of being crooks in Seanad debate over tracker mortgage scandal

Banks came for severe criticism in a Seanad debate
Banks came for severe criticism in a Seanad debate

Charlie Weston Personal Finance Editor

Banks have come in for severe criticism in a Seanad debate for taking good-value tracker mortgages off customers.

The lenders were accused of being crooks, operating a cartel and of being corrupt.

A number of senators called for the gardaí to investigate the tracker scandal so that bankers can be held personally responsible.

Minister for State at the Department of Finance Michael D'Arcy said banks had behaved disgracefully.

Up to 35,000 mortgage holders may have been denied a tracker and forced to pay too much. Some 102 of these people lost their properties, with around a quarter of them homeowners who have ended up with the bank taking possession of the property.

"What is clear at this point is that some tracker mortgage customers have been treated disgracefully by mortgage lenders and that many borrowers have incurred considerable loss, in particular where they have either directly or indirectly lost their homes due to this harmful action by lenders," the minister told the Seanad debate on the tracker issue.

Senator Gerard Craughwell said banks were “more Ned Kellys” than the respected institutions of the past.

He questioned how so many of banks ended up acting in the same way, by denying mortgage holders their contractual rights to a tracker.

He called for the courts to rule on compensation levels, instead of each bank being allowed to set its own level of compensation for the losses.

"I want the courts to rule on compensation and that can set a benchmark, because we have seen how these crooks operate."

He called for the gardaí and the Office of the Director of Corporate Enforcement to probe the 11 lenders that denied customers trackers.

Sinn Féin’s Senator Rose Conway-Walsh blamed Fianna Fáil and its closeness to bankers for bankers deciding to act as they please.

"That absolute corruption in the banking system was allowed to happen. We have the pictures of politicians playing golf with bankers," she said to heckling.

Fianna Fáil’s Gerry Horkan said the Government should vote against the re-election of the boards of the banks where it has a shareholding.

He said it was difficult to believe there was not collusion among the banks and cartel-like activity when so many of them acted in the same way to deny people their rights to a tracker.

Senator Horkan said banks continue to refuse to take responsibility for their actions.

Minister D’Arcy responded that any claims of cartel-like activity were a matter for the Competition and Consumer Protection Commission, and the EU’s Competition Directorate under Commissioner Margrethe Vestager.

"Was there cartel-like activity in the banks? That is a matter for the EU Competition Commissioner. She is pretty good at slapping fines on us. Maybe she should have a look at it."

He said whether there was any evidence of criminal behaviour in the banks was a matter for the gardaí to investigate.

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