# Scandal MARS and CPC - Who is batting for Customer?



## WizardDr (25 Aug 2013)

UK – “City watchdog to stick up for ‘ordinary consumers’ FT 24 August 2013.

The FT carried an interview with Sue Lewis consumer chief of the Financial Conduct Authority (‘FCA’) this weekend. It makes disturbing reading. The latest scandal involves the Banks selling worthless credit card theft insurance. When a card is stolen, the Banks already have liability.  They referred the customers to an insurance provider who happily sold the thrash insurance that provided cover in the event of theft, which was not in fact needed. 

Lewis suggests that the way to restore trust is to crack down harder on the mistreatment of ‘ordinary retail customers’ by Banks. Trust is about the little stuff Lewis says. Things that apparently irritate customers and the FCA are using behavioural economics to help. 

If the six year statutory period that applies here, applied in UK, the FCA would not have been able to impose solutions in the credit card case.

This should help the folk in the Financial Ombudsman Office who find the same complaints arising again and again. You would almost think that the Banks simply do not learn from previous mistakes. It is simply that many of the systems in Banks are old IT systems and the Banks are just ignoring it. The Banks have discovered that the FSO isn’t up to the job. It has  no teeth because even of the same rubbish turns up 100 times it cannot order the Bank to fix it. Very few of the FSO cases go the High Court – which if they did would put manners on the Banks. We need to take cases to the High Court – that will bring respect – which Fiona Muldoon of the Central Bank feels she has from the Banks. Indeed! Using the 2011 Central Bank Act against Newbridge Credit Union – is stirring stuff. Bank CEOs must be quaking in their boots.  

Those of us who have helped a number of people get their trackers back know all about this carry on. Some customers in the same Bank will have had trackers restored and others have been refused. This has happened in circumstances that a lawyer says are ‘on all fours’ as in they are exactly the same circumstances - with one twist. The twist is that when the Bank respond, they send out a long legally constructed letter which denies your claim for various reasons. The difference arises where these are rebutted skilfully - then the Bank concedes. If you don’t respond, you don’t get your tracker restored. Is this appropriate behaviour where there is a consumer pitted against the Bank? Where is the Central Bank on this?

In the traumatic arrears cases, the Banks have put it out that there are strategic defaulters. Most right thinking people are appalled if this were true. It may be. There is no evidence. Similarly, there are strategic deflectors in Banks. Customer correspondence on arrears is not either being opened or attended to within the CPC nor the MARS time limits or not at all. I have seen several different cases which demonstrate a complete lack of any compliance with CPC and MARS. How does this affect a customer that is under stress already? 

Lewis argues that since the financial crisis nobody is thinking about the consumer who is paying for the whole thing – this is particularly true in an Irish context. So you would imagine that the Central Bank would be particularly sensitive to this. Ask the Central Bank to tell you how many distressed mortgage customers they have met. But Fiona Muldoon was more concerned with having respect from the Banks than getting the job done. And the Central Bank has apparently found that its bank inspection people cannot ask the right questions of Banks. 

Here are four:
Mr Honohan – are you aware that the Banks are not replying to correspondence from customers in compliance with the CPC or the MARS codes of conduct?

Mr Honohan have you asked the CEO to give you a statement in writing approved by the Board of Directors that they have made enquiries to satisfy themselves that the Codes are being implemented in full?

Mr Honohan are you aware that some Banks have refused to restore trackers and at the same time restore tracker mortgages with the exact same circumstances?

Mr Honohan have you or anybody in the Central Bank met any mortgage arrears customers?


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## ajapale (25 Aug 2013)

Hi Wizard,

Can you expand your title a little to better reflect your question/discussion point ?

Scandal MARS and CPC

Thanks
aj
moderator


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## Brendan Burgess (25 Aug 2013)

Hi Wizard 

I have read your post twice. 

You seem to be confusing the Ombudsman and the Central Bank - they have different functions. 

You are talking about trackers one minute and the Mortgage Arrears Code the next - you are confusing me. 

*You ask who is batting for the consumer? 

*Well not the Ombudsman, because that is not his job.  Just as the courts are not batting on behalf of the plaintiffs. 

The Central Bank does have a role to protect consumers and it has done some great things to protect consumers.


It published the Consumer Protection Code
It has published the Mortgage Arrears Code
It has told the banks to get on with providing solutions to those in arrears
It has told the banks to review their selling of PPI
It has ordered the banks to make systematic refunds to customers e.g. Bank of Ireland was told to  give 1,800 people back their trackers
In particular it has saved the Credit Union movement from itself by putting restrictions on their ability to make loans. It's a pity that they did not apply this to the banks.
*But the Central Bank could be a lot better in protecting consumers 
*


I am concerned that customers will lose their trackers under the new Mortgage Arrears Code
The mis-selling of PPI is going too slowly
There are other systematic issues which it is not taking action on
Just ask yourself this - Is the customer better off in 2013 than they were in 2003 before the Financial Regulator was set up?  They clearly are. 

As I was confused with the question, I am not sure if I have answered it.

*A lot of the problems stem from the legislation setting up the Ombudsman 

*The 6 year time limit is set down in the legislation. It's outside the remit of the Ombudsman to change it. The Oireachtas must do that. 

The Ombudsman is obliged under law to look at all complaints on a case by case basis. Again, this should be changed as there is huge inconsistency in their decisions. 

In systematic cases, the financial institution has huge advantages over the consumer.  They have the experience of defending this issue before and they know which arguments tend to work and which arguments tend not to work. So they have a pretty good idea of how best to present the case. The consumer has only one shot at a complaint. 

And if the consumer gets a bad decision, it can't afford to appeal to the High Court.  If a Financial Institution loses a case which affects many people, it's well worth its while to appeal to the High Court.


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## WizardDr (25 Aug 2013)

@BB

The Ombudsman should have the capability that when the same rubbish is turning up that he can get the Banks to change systems. Its quite easy when you have a load of similar complaints to fix the system. That is the point he was making.

The Central Bank has a consumer role, otherwise why has it anything to do with issuing codes on CPC and MARS.

What I am directly saying is that the Banks are in the breach of the codes on a regular, sustained and systematic basis.

I think the Central Bank are frankly not with it.


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## Luternau (26 Aug 2013)

I can't figure out what you are saying here. The subject is almost coded - one would not know from it what the post was actually about.

Perhaps a better title may help put the whole thing in context?


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## ajapale (27 Aug 2013)

Luternau said:


> I can't figure out what you are saying here. The subject is almost coded - one would not know from it what the post was actually about.
> 
> Perhaps a better title may help put the whole thing in context?



I cant understand the title or the post. I have added a link to the FT article which is an interview with Sue Lewis consumer chief of the UK Financial Conduct Authority (‘FCA’). 

I imagine the op wants us to read the FT article and apply some of the points made by Ms Lewis to the situation as it pertains in Ireland.


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## Gerry Canning (29 Aug 2013)

ajapale said:


> I cant understand the title or the post. I have added a link to the FT article which is an interview with Sue Lewis consumer chief of the UK Financial Conduct Authority (‘FCA’).
> 
> I imagine the op wants us to read the FT article and apply some of the points made by Ms Lewis to the situation as it pertains in Ireland.


.........................................................................................
I see title as ; 
1. Is Central Bank fulfilling its consumer Mandate.?
2. Is our Ombudsman fit for pupose. ?

Clearly the feeling on the post is that neither of them are in any way applying Consumer Codes in anything like the way they are observed in the UK.
Clearly there are HUGE questions to be answered by our Central Bnk and Ombudsman
Clearly Ombudsman and Central Bank have different functions.
Clearly our contibutor is vexed .

From my view he is correct to highlight this.
From my view this spiltting hairs over Central Bank/Ombudsmans functions lets the Authorities compartmentalise Consumers issues and issues end up in a morass of who is respnsible for an issue  ie a fudge!.

From my view our Central Bank have patently failed in their Mandate to protect consumers.

From my view our Ombudsman has patently failed in his application and understanding of Consumer Protection Codes...

Under PPI , I will be putting letter I sent to Central Bank.

I would welcome any input.


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## Brendan Burgess (29 Aug 2013)

Hi Gerry

Thanks for translating the Doctor's post. 

It makes a bit more sense now. I had guessed something similar, but wasn't sure. 

Brendan


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