There are so many categories of tracker mortgage customers seeking redress, refunds and compensation, that any expectation that this latest bank scandal will be finally sorted out by Christmas is wildly optimistic.
There is still no definitive number about the numbers of customers affected though it could be as high as 21,000. The banks have reported that c7,000 settled their cases with their banks before 2015 when the Central Bank began its investigation but that of the 21,000 estimated lost trackers, perhaps as many as another 10,000 cases still await proper investigation and settlement.
To date there is still no consensus on how refunds, redress or compensation should be calculated let alone delivered, and the politicians are now arguing about the new powers and regulations that need to be assumed to both identify individuals at fault and how the banks – which may or may not been acting in concert, should be sanctioned.
Of course the political firestorm will die down. But the Central Bank and its agencies have much to answer for about their lack of urgency and direction: complaints about trackers not being reverted from temporary but lower cost fixed contracts would have started arriving on the Financial Ombudsman’s desk by 2009.
According to consumer advocate Padraic Kissane of KissaneFinancialServices.ie, there have been about 30 different commutations of tracker loss identified, which partly explains the delays in working out what happened and how refunds, redress, and compensations should be applied.
None of this will be sorted out by Christmas. One solicitor’s practice I spoke with last week, who like Mr Kissane represents many complainants, said they hoped their client, who eventually moved to another bank that offered him a better variable rate than the one his original tracker lender foisted him on, “will finally close this terrible chapter in his life by Christmas 2018.”
Readers continue to come forward seeking assistance in dealing with their bank or the institution to which their mortgage has been sold. Unfortunately few of them either contacted a solicitor or well-known public advocate like Patrick Kissane or David Hall of the Irish Mortgage Holders Organisation.
In many cases once they discovered they’d lost their valuable tracker they would contacted their lender, but in the end – often because the six year statute of limitations on taking complaints to the Financial Ombudsman was mentioned, they reluctantly accepted an alternative loan. Some opted to move their mortgage to a new lender.
These customers need to re-engage with their old bank and demand of them that in light of all the information that has emerged from the Central Bank’s investigation (and the revoking of the six year rule for tracker victims) that they are now seeking restitution of their old tracker loan, a refund of the higher mortgage repayments they made from the time their original tracker was revoked. They shouldn’t wait for the lender to contact them.
They also need to put a clear schedule of their entire tracker loan experience – when it was granted, how and when it was revoked and any subsequent actions. They need to attach all correspondence and phone records, if possible.
They should also send copies of this and all original and subsequent correspondence with their lender to the Central Bank, (and even to their local TD and the Minister for Finance for good measure.)
Consumer advocates (and there are a number of them) can be approached too, to ask for their direction or assistance in the event this demand for restitution and redress goes unanswered or is rejected by the original tracker lender or if they are told by the CB to take their complaint to the Financial Ombudsman.
Anyone whose complaint has been previously rejected by the Financial Ombudsman might want to have the judgement reviewed as there has been concern about the way so many complaints were inexplicably dismissed by that office.
Anecdotally, readers, solicitors and consumer advocates have told me that tracker borrowers whose contracts were revoked and who immediately threatened their lenders with a legal challenge from late 2008-2009 were always the most likely to be offered quick settlements.
Legal threats focus the mind, but they also cost, and too many tracker holders coming off fixed rates at the height of the economic crash had neither the financial resources nor the confidence to take on their bank.
The Central Bank, which should have spotted the pattern of trackers being revoked from 2009 (if they had conducted proper branch audits of customer complaints) has failed us miserably.
It isn’t just retail bank executives whose heads now need to roll. The Central Bank needs a shakeup too if there is to be any restoration in trust in the banks…and the bank that polices them.
Finally, and it’s been a mantra of this column for 17 years: never make any important financial decision without carefully reading the contract. And always take independent, impartial, fee based advice before signing it.
Please send your queries to Jill c/o this paper or by email: email@example.com
(The 2018 TAB Guide to Money Pensions & Tax will be appearing in bookshops and on line soon. See www.tab.ie for ebook edition.)