IT IS now 13 years and counting since the tracker mortgage overcharging scandal was first exposed.
nd it is not over yet. Bank of Ireland is still to be fined, while more than 1,000 tracker-loss cases are being dealt with by the Financial Services Ombudsman.
Some €180m in fines have been imposed by the Central Bank on a string of lenders for tracker mortgage regulatory breaches,
Despite this, no individuals have ended up behind bars for their actions in wreaking havoc on families by tricking them out of their good-value trackers at a time when the economy was on the skids.
Yes, there are two inquiries into individuals being conducted by the Central Bank but one of those largely involves issues other than trackers.
The Central Bank has concentrated on fining the institutions. And AIB Group’s fine, at just short of €97m, is the largest by a long shot. On top of this the bank has had to shell out more than €600m in compensation, redress, legal fees and administrative costs.
And well it should. The rap sheet is long and makes for depressing reading.
AIB and its subsidiary have finally owned up to failing to give people good-value trackers when they were entitled to them. It failed to warn customers who moved off the tracker to a fixed rate for a period that they would not get them back and wrongfully excluded customers from the Central Bank-owned probe into the tracker issues.
That is just a sample of the 57 regulatory breaches committed by AIB, and 36 perpetrated by EBS.
Some 21 homes were lost as a direct result of the actions of the two lenders.
And we don’t know how many suicides and mental health issues resulted for families coming under huge financial pressure to meet higher mortgage payments during a time of austerity after losing their cheap trackers.
So far the debacle has cost the lenders €1.5bn in fines, compensation, legal fees and other costs.
Around 41,000 mortgage accounts have been affected across all lenders.
At AIB, 10,015 individual customers were affected while 2,830 EBS customers were impacted.
Tracker mortgages were introduced in this country by Bank of Scotland in 2001, with the public quickly realising they were a good thing. They worked well for banks for a while too, when their funding costs were in line with European Central Bank rates.
But the financial crisis that hit in 2008 meant lenders’ borrowing costs shot up. They then embarked on a campaign to rid their books of as many trackers as possible.
This newspaper was the first to break the story in October 2009 that there was an issue with banks wrongfully denying people tracker contracts they were entitled to have.
The Irish Independent got access to a letter sent by the then Financial Services Ombudsman Joe Meade to the Central Bank asking it to investigate what he saw as an industry-wide attempt to get people to part with their trackers.
It took until 2015 before the Central Bank forced lenders to carry out an industry-wide review of their mortgage books to see how many customers had been wronged.
The banks argued and resisted. Of the 41,000 cases across all lenders, half of these admissions were the result of the Central Bank strong-arming lenders into submission. We bailed out the banks and they thanked us by tricking their customers off good-value trackers, all because they had miscalculated the profitability of those mortgages.
It is now time the Central Bank was the subject to an independent review of why it has taken so long to get this all sorted out.
Some of those impacted by the tracker scandal now have teenagers who were not born when the debacle first started. It should not take so long to get to the bottom of such a scandal.
Denial of responsibility! insideheadline is an automatic aggregator around the global media. All the content are available free on Internet. We have just arranged it in one platform for educational purpose only. In each content, the hyperlink to the primary source is specified. All trademarks belong to their rightful owners, all materials to their authors. If you are the owner of the content and do not want us to publish your materials on our website, please contact us by email – [email protected]. The content will be deleted within 24 hours.