You are here: Home - News -

Banks may have colluded in Irish tracker scandal

by:
  • 05/04/2017
  • 0
Banks may have colluded in Irish tracker scandal
The Irish Central Bank has contacted the Gardai, after admitting that it believes the country's banks may have colluded with each other in order to overcharge thousands of borrowers on tracker mortgages.

Reports suggest that as many as 22,000 borrowers have been affected by the scandal, either by being denied a tracker mortgage or being moved off them incorrectly, following the financial crisis.

Philip Lane, governor of the Central Bank, said there was a “systemic” issue, with 15 banks ordered to examine their back books.

Lane said: “I’m not going to rule out, until these examinations are concluded, the hypothesis of collusion but there was an economic imperative here for many of these banks. Essentially, I think what was happening was that they were trying to, [during] a period of financial stress, save money by charging customers, where they could, a higher, more expensive rate.”

Banks have already started paying compensation to borrowers over the affair – according to the Central Bank, around €78m (about £67m) has been paid out in redress to 2,600 victims, with another 7,000 affected customer accounts identified.

One lender, Springboard, has been fined €4.5m (£3.85m) for its behaviour, on top of the €5.8m (£4.96m) it has already paid out in compensation.

Lane warned further fines may be on the way. He said: “We may also commence other investigations, as appropriate, into other lenders and persons concerned in the management of such entities where there is evidence of non-compliance with regulatory requirements.

“In this regard, enforcement activity will be influenced by the outcome of the reviews currently being conducted as part of the tracker examination.”

There are 0 Comment(s)

You may also be interested in

Business Skills

In this section, we offer short ‘how to’ guides on harder to crack areas of business. From social media, to regulation or niche product areas, we cover it all.

Profiles

Our journalists interview key industry entrepreneurs, strategists and commentators for day-to-day market insight and a strategic view of where the industry is heading. We offer lessons for success and explore the opportunities for your business

Success in Practice

Here, we share case studies fleshing out best practice to help you decide what could work for your business. Take a look at how others approached complex tasks like launching a new mortgage lender, advising on a new product area or deciding to specialise in another. Learn from others mistakes and triumphs.

Marketwatch

Each week, we ask top mortgage and property commentators with a unique perspective to examine a key news headline, market move or regulatory or political issue.

Poll

Vote in our weekly poll here. It’s your chance to tell us what you think and be heard on the top news stories of the week. Review our archive to find out what your industry really thinks and all our coverage of the results.

Top Comments

Be part of the conversation on Mortgage Solutions. We want to hear from you. We have a tool called Disqus to tell us which stories get the most comments each week. Every Friday, the team picks the most thoughtful or opinionated contributions from our readers to enjoy again. Don’t forget to share your favourite stories from the site on social media to keep the conversation going.
Read previous post:
Jeremy Duncombe director Legal and General Mortgage Club
FPC fails to apply common sense to mortgage affordability

The Financial Policy Committee’s (FPC) decision to keep the affordability stress rate for mortgage customers at 3% is a missed...

Close