Borrowers have been treated 'disgracefully' by banks during tracker mortgage scandal - Paschal Donohoe
Finance minister Paschal Donohoe has said that borrowers have been treated "disgracefully" by the banks during the tracker mortgage scandal.
And he said the government isn't satisfied with the progress banks have made in resolving the situation that saw people who had been on tracker mortgages lose money after being wrongfully removed from the schemes.
Mr Donohoe said the the time has arrived for the banks to "to finally act in the best interest of their impacted mortgage customers."
And he added: "of course they should have done this from the beginning."
Mr Donohoe made his remarks in the Dáil after meeting the bosses of several banks.
Read more: How to tell if you are affected
Fianna Fáil TD Michael McGrath asked Mr Donohoe if he could give a commitment that people affecetd by the scandal will get their money back along wiht compensation
He also asked if Mr Dohonoe coudl give a commitment that there "will be accountability as to how this happened in the first place and that there will be a thorough investigation which gets to the bottom of how exactly this could occur"
Mr Donohoe said: "I have just concluded my meetings with the ceos of Bank of Ireland, AIB, Permanent TSB, Ulster Bank and KBC to discuss the tracker mortgage examination.
"I and the government are not satisfied with the progress that lenders have made to date and believe that impacted customers should by this time had their tracker mortgages restored and where appropriate have received redress and compensation."
He said that the Central Bank is examining the tracker mortgage issue and outlined enforcement actions that have taken place so far.
Mr Donohoe said the Central Bank has already imposed a €4.5m penalty on Springboard Mortgages Ltd.
"Currently the Central Bank is pursuing investigations in relation to tracker mortgage-related issues arising in both Permanent TSB and Ulster Bank Ireland.
"Two further enforcement investigations into other lenders are in train," Mr Donohoe added and said that the Central Bank has indicated that further enforcement investigations can be anticipated.
Mr Donohoe also noted that the Central Bank has reporting obligations to the Gardaí and other agencues where they suspect that a criminal offence may ahve been committed and it "takes these obligations very seriously".
He said he supported the Central Bank in "pursing its tracker mortgage related investigations and and any other necessary action to the fullest extent and as expeditiously as possible."
The finance minister also said: "I believe the impacted tracker mortgage borrowers have been treated disgracefully by mortgage lenders and that many borrowers have incurred considerable losses and in some cases even more significant harm.
"We should be clear that it was the mortgage lenders that caused this harm to their customers and the primary responsibility for rectifying the problem rests with them."
He said that all lenders need to cooperate with the Central Bank examination to the Bank's satisfaction and "more particularly to the satisfaction of their impacted customers."
"The main point I want to make now is that the time has now arrived for banks to finally act in the best interest of their impacted mortgage customers... Of course they should have done this from the beginning," he said.
Mr Donohoe said he will have further contact with the banks over the next 24 hours and promised to update the Dáil on how these talks have gone tomorrow evening.
Sinn Féin TD Pearse Doherty again asked Mr Donohoe when the affected customers would get their money back from the banks and if this would take place by the end of the year.
Mr Doherty said the sum the banks had taken from their customers is in the region of €300m.
Mr Donohoe offered no specifics on when he expects borrowers to get their money back as well as compensation but said people owed money "should have their money repaid to them".
Mr McGrath raised concern that fines - like that imposed on Springboard - are "not the answer" in terms of ensuring accountability.
He said he feared that such fines if imposed on other banks will "simply be passed on to customers" and those responsible for the scandal won't be held to account.
Mr Doherty asked Mr Donohoe if he told the banks to "return the money immediately" and asked if he had warned them that the the board of those part owned by the State would be sacked.
Mr Donohoe said he was "very clear" that the banks' failure to repay their customers is "unacceptable" and he said he supports the Central Bank's use of its powers to bring the matter to a conclusion.
He said: "Too many people are waiting for their money back, too much confusion still exists regarding where this issue stands.
"And the engagement that I have had with the banks…I have been clear that this is a disgrace and it should have been resolved by now".