# Final report of Central Bank on Tracker Examination published



## Brendan Burgess (16 Jul 2019)

*€683 million paid to affected customers – Final Report of Central Bank Tracker Mortgage Examination*


Final report of Tracker Mortgage Examination shows lenders have paid out €683 million in redress and compensation to customers
40,100 customers affected by lenders’ failings, with 98 per cent of those affected having received their redress and compensation at end-May 2019
One enforcement investigation completed and record fine imposed, with investigations against the remaining lenders continuing
 

The Central Bank has published the  final report of the Tracker Mortgage Examination, showing that at end-May 2019, lenders have paid out €683 million in redress and compensation to customers affected by their failings. In all, 40,100 customers have been affected.

Following extensive and robust supervisory challenge and assurance work to ensure lenders identified groups of customers affected by tracker failings, the supervisory phase of the Examination is complete.



The Central Bank completed its first enforcement action in relation to the Examination at end-May, fining PTSB €21 million for its failings. Enforcement investigations against all the other main lenders continue.



Derville Rowland, Director General, Financial Conduct, said:

“The scale of lenders’ tracker mortgage failings was industry-wide, causing immense distress and damage to affected customers and their families. It required an unprecedented regulatory response in the shape of the Tracker Mortgage Examination, the largest, most complex and significant consumer protection review the Central Bank of Ireland has ever undertaken. Through the Examination, we required lenders to identify those affected and pay appropriate redress and compensation. Additionally, we continue to pursue lenders through our enforcement investigations. The outcome of our first enforcement action – which resulted in the largest fine imposed to date by the Central Bank - reflects the gravity with which we view lenders’ tracker failings.

“The Examination revealed the unacceptable damage that misconduct can cause to consumers up to and including the loss of their homes and properties in some cases. Our message today – to all the firms we regulate – is very clear: Where firms fail to protect their customers’ best interests, our response will be robust and the consequences will be serious.”

*ENDS*

Notes:


The €683 million paid out by lenders to end-May includes €47 million paid out outside of the Tracker Mortgage Examination.
The figure of 40,100 affected is an aggregate figure including c.33,000 affected customer accounts accepted by lenders as part of the Examination as well as c.7,100 tracker mortgage cases remediated following Central Bank intervention outside of the Examination.
Through all of the enforcement investigations, which span lengthy time periods, the Central Bank is seeking to establish the circumstances in which customers lost their trackers and how lenders dealt with tracker mortgage issues as they became aware of them. The enforcement investigations are also examining whether the documentation, which customers received from lenders, was clear and what key decisions lenders took (or omitted to take) which resulted in customers losing their trackers or being on the incorrect rate.
·         While the supervisory phase of the Examination is now concluded, the Central Bank will continue to monitor the outcomes of any complaints, appeals and court cases.

·         Ninety-eight per cent of identified affected customer accounts had received offers of redress and compensation by the end of May, while the remaining customers will have received their offers by now or in the coming weeks - where they are contactable.

·         In the case of the small number of customers who have proved uncontactable to date, the Central Bank has set out its expectation that lenders hold their redress and compensation in a special ring-fenced account.


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## FT1579 (16 Jul 2019)

Thanks for this Brendan. I just saw this on RTE.ie wouldn't it just be nice to get back what we've all overpaid. Upsetting to see how many have lost their homes because of all this.


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## Fakenews (16 Jul 2019)

Would be good if the enforcement fines were ringfenced into an account to fund High Court Proceedings. I’m not sure why the fines aren’t distributed or purposed for the use of the people who were impacted.


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## Dazzler123 (16 Jul 2019)

Fakenews said:


> Would be good if the enforcement fines were ringfenced into an account to fund High Court Proceedings. I’m not sure why the fines aren’t distributed or purposed for the use of the people who were impacted.



That would be illegal third party funding of litigation.  Plus why would the central bank encoyrage high court cases on this issue? They investigated and they have identified the custmers affected and will levy what they see as appropriate fines...


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## demoivre (16 Jul 2019)

Dazzler123 said:


> They investigated and they have identified the custmers affected and will levy what they see as appropriate fines...



If that's the end of the matter what's the purpose of the FSPO ?


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## mccoypat94 (16 Jul 2019)

demoivre said:


> If that's the end of the matter what's the purpose of the FSPO ?



It appears highly unlikely that the FSO is going to rule in favour of anybody outside the 40000 at this stage.  Many who may have thrown good money after bad in taking a case. Salt in wound stuff


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## SeanMortgage (16 Jul 2019)

So really what does this mean for all the AIB Customers who had the tracker option removed when they came of a fixed rate back in 2008??


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## Dazzler123 (16 Jul 2019)

demoivre said:


> If that's the end of the matter what's the purpose of the FSPO ?




Its the end of the matter from the cbi point of view.  The Fspo may take a different view in individual cases but they will be fought tooth and nail by the banks.  And rightly so in my view.  The banks have complied with the body set up to investigate the tracker issues (mostly).  Any further claims should be fought as any further cohorts opening up leaves the banks open to more cbi fines


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## Brendan Burgess (16 Jul 2019)

Some of the highlights 




Chart 5 above includes c. 830 customer accounts which received a payment in excess of €100,000. Of this figure, 228 lost ownership of their property due to tracker failures, 75 of which were PDH properties.


To date, ten per cent of affected customers have made appeals. The lenders’ independent appeals panels have awarded customers c. €7m at end May 2019, with the majority of upheld appeals arising from awards for additional detriment due to personal customer circumstances of which the lender may not have been aware at the time the original redress and compensation was awarded.



Redress€547Compensation c.20%€136mTotal€683m


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## demoivre (16 Jul 2019)

mccoypat94 said:


> It appears highly unlikely that the FSO is going to rule in favour of anybody outside the 40000 at this stage.



According to who ?


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## Fakenews (16 Jul 2019)

Dazzler123 said:


> That would be illegal third party funding of litigation.  Plus why would the central bank encoyrage high court cases on this issue? They investigated and they have identified the custmers affected and will levy what they see as appropriate fines...


If you are referring to “maintenance and champerty” this could be easily fixed through new legislation. In fact, the UK have already done so and the basis of the law in the two jurisdictions is the same.
 Anyway, shouldn’t the state have a “bona fide” interest in ensuring those who have been harmed receive adequate compensation?
 The CBI has provided three avenues for impacted customers to pursue redress: independent appeal, FSPO and High Court. The appeals process works on the basis that nobody will go to the high court as the potential downside is too large for individual customers. Therefore any cases which are considered to be marginal that they would win or lose they kick to touch. I don’t think that would be the case if a genuine threat of the High Court existed.


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## Dazzler123 (16 Jul 2019)

Fakenews said:


> If you are referring to “maintenance and champerty” this could be easily fixed through new legislation. In fact, the UK have already done so and the basis of the law in the two jurisdictions is the same.
> Anyway, shouldn’t the state have a “bona fide” interest in ensuring those who have been harmed receive adequate compensation?
> The CBI has provided three avenues for impacted customers to pursue redress: independent appeal, FSPO and High Court. The appeals process works on the basis that nobody will go to the high court as the potential downside is too large for individual customers. Therefore any cases which are considered to be marginal that they would win or lose they kick to touch. I don’t think that would be the case if a genuine threat of the High Court existed.




The appeals boards are indrpendent and fspo is free. Plenty of avenues to appeal the matter. Ring fencing fines just means lawyers get paid


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## demoivre (16 Jul 2019)

Dazzler123 said:


> Its the end of the matter from the cbi point of view.  The Fspo may take a different view in individual cases but they will be fought tooth and nail by the banks.  And rightly so in my view.  The banks have complied with the body set up to investigate the tracker issues (mostly).  Any further claims should be fought as any further cohorts opening up leaves the banks open to more cbi fines


The Central Bank doesn't  appear to be as confident as you are that this matter is done and dusted and I concur.





__





						"the Central Bank is not in dispute with any lender in respect of groups of customers which should be deemed impacted"
					

From their report  3.5. Supervision Conclusion The Framework focused on the identification, by lenders, of groups of customers affected by tracker related issues from a systemic perspective. While the Central Bank is satisfied that the supervisory phase of the Examination was suitably robust and...



					askaboutmoney.com


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## Fakenews (16 Jul 2019)

Dazzler123 said:


> The appeals boards are indrpendent and fspo is free. Plenty of avenues to appeal the matter. Ring fencing fines just means lawyers get paid


I don’t Like that money ends up in lawyers pockets but the fact that the threat isn’t there makes it easier to kick to touch. I don’t really like the fact that the fines go the CBI when this happened under their watch. Fines are a slap on the wrist to the banks and the money doesn’t end up with the people who were harmed.


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## SaySomething (16 Jul 2019)

SeanMortgage said:


> So really what does this mean for all the AIB Customers who had the tracker option removed when they came of a fixed rate back in 2008??


The AIB Customers were deemed impacted. They just weren't returned to the margin they expected. That's a different scenario altogether.


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## PFS7979 (16 Jul 2019)

mccoypat94 said:


> It appears highly unlikely that the FSO is going to rule in favour of anybody outside the 40000 at this stage.  Many who may have thrown good money after bad in taking a case. Salt in wound stuff


What is your rationale in saying that?

I feel relatively confident the fspo will rule in favour of the comsumer in many instances on tracker related issues


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## Dazzler123 (16 Jul 2019)

demoivre said:


> The Central Bank doesn't  appear to be as confident as you are that this matter is done and dusted and I concur.
> 
> 
> 
> ...



That quote seems to agree with me.. i said its finished from the cbi point of view and that individual cases will be dealt with by the fspo (and or the courts).  

Point is that if you have not gotten tracker redress by now, youre not getting any inless you take a case to the fspo or courts


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## Dazzler123 (16 Jul 2019)

Fakenews said:


> I don’t Like that money ends up in lawyers pockets but the fact that the threat isn’t there makes it easier to kick to touch. I don’t really like the fact that the fines go the CBI when this happened under their watch. Fines are a slap on the wrist to the banks and the money doesn’t end up with the people who were harmed.



But the money has ended up with the people harmed via compensation payments and adjusted mortgages. In fact, anyone who was sensible during the boom and took out a reasonable mortgage, managed to pay their bills,but got stung by the tracker issue have won the lottery via tracker redress


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## notabene (16 Jul 2019)

Dazzler123 said:


> But the money has ended up with the people harmed via compensation payments and adjusted mortgages. In fact, anyone who was sensible during the boom and took out a reasonable mortgage, managed to pay their bills,but got stung by the tracker issue have won the lottery via tracker redress



not so sure i'd say they've won the lottery via tracker redress by any manner or means, i certainly haven't


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## Brendan Burgess (18 Jul 2019)

I participated in the Irish Times podcast to discuss the report which you can listen to here: 









						Tracker Mortgage Scandal: Have The Banks Learned Their Lesson?
					

With the publication this week of the final report on Irish banks's practice over several years of denying customers their rightful tracker mortgage rates, Ciarán talks about the scandal with Brendan




					soundcloud.com
				




It's about 40 minutes long. 

Brendan


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## Fakenews (18 Jul 2019)

notabene said:


> not so sure i'd say they've won the lottery via tracker redress by any manner or means, i certainly haven't


Me neither! I’m not sure that getting back the overcharged interest which never belonged to the bank in the first place qualifies as winning the lotto.


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## NoRegretsCoyote (18 Jul 2019)

Brendan Burgess said:


> I participated in the Irish Times podcast to discuss the report which you can listen to here:
> 
> 
> 
> ...



Well worth a listen.

Thanks for pointing out that a large majority of people in arrears are in positive equity and, if forced to sell, could afford something smaller or to rent.


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