AIB Central Bank “AIB roll out of FSPO decision is outside of TME”

RealDeal

Registered User
Messages
40
Received this from the Central Bank when I asked why we were not benefiting from the Principles re: Tracker Review ....

While the Central Bank does not have a statutory role in investigating individual consumer complaints, we use any information that we receive directly from consumers to guide the scope of our broader supervisory work. I note from your email that you are included in the prevailing rate cohort and have received correspondence from AIB with regards to the balance adjustment on your account, arising from AIB applying a Financial Services and Pensions Ombudsman (“FSPO”) decision to the wider customer group.

AIB has publically committed to applying the award from the recent FSPO decision to other customers in the same cohort, which is in line with the expectations sets out by the Central Bank to lenders that if any individual outcomes arose from the FSPO or court processes that had the potential to impact customers more widely, that lenders then had to address this broader impact. However the application of the FSPO decision to the wider group of customers is outside of the Tracker Mortgage Examination (“TME”) Framework set out by the Central Bank and as such the principles of the Framework do not have to be applied by the lender. Customers can make a complaint to AIB and the FSPO to raise their own individual personal circumstances and this is an option you may wish to consider, to ensure that your personal circumstances are considered.

Any further information relating to the impact of the FSPO decision on your mortgage should be sought from AIB directly.
 
Last edited by a moderator:
However the application of the FSPO decision to the wider group of customers is outside of the Tracker Mortgage Examination (“TME”) Framework set out by the Central Bank and as such the principles of the Framework do not have to be applied by the lender.

Thanks for the update. It is interesting, if very disappointing.

I can't really understand the reasoning.

Brendan
 
So back to the drawing board? So frustrating.
Did you get that response quickly? I wrote to the CBI the other day too and have heard nothing yet.
 
AIB is applying the FSPO ruling - 12% and interest on the 12%.

It is not paying the 15% compensation in the original AIB lost tracker scheme.
And it is not paying the automatic compensation paid to everyone who lost their homes who also lost trackers.

So these people will have to apply to AIB for further compensation and if they are not happy with the response, they will have to go to the Ombudsman.

Brendan
 
Very disappointing to read this, looks like another couple of years before we see the end of this now.
 
Just looking through some of the responses from AIB to the BDO and the cover page(I assume added by the BDO) has our account no and the words Impacted in bold above it. So the appeals panel considers us impacted is that worth anything?
 
AIB is applying the FSPO ruling - 12% and interest on the 12%.

It is not paying the 15% compensation in the original AIB lost tracker scheme.
And it is not paying the automatic compensation paid to everyone who lost their homes who also lost trackers.

So these people will have to apply to AIB for further compensation and if they are not happy with the response, they will have to go to the Ombudsman.

Brendan
Bit of a philosophical question but are the 300 inside or outside the TME?
 
I read the framework doc here and am having a hard time understanding why we would be excluded. Is there another set of criteria or is it up to the bank and CBI to decide?

From the framework doc

The time period is from section 3.1
"The relevant period is the period of time from when the lender commenced offering Tracker Interest Rates to 31 December 2015" So we certainly fall into the correct time range and could this be used to argue against the Jan 5th cut off for inclusion?

Ironically covered in section 3.2
"where the underlying mortgage agreements provided for contractual rights to or options for Tracker Interest Rates at any stage during the term of the agreements"

Further clarified in section 3.3.1
"customers had contractual rights to be offered the option of having Tracker Interest Rates applied to their mortgage accounts at any stage during the Relevant Period and were not offered the option of having Tracker Interest Rates applied to their accounts at the appropriate and/or any stage during the Relevant Period.

and to determine whether or not all

contractual rights and obligations regarding Tracker Interest Rates were adhered to and/or honoured during the Relevant Period"

In Section 3.6.1 TRANSPARENCY CONSIDERATIONS
" a particular term pertaining to the loan agreement was given different meanings by the lender at particular points in time or whether certain terms had dual meanings, with the potential to confuse customers"

We seem to match under several criteria my appeal letter keeps getting longer and more complicated!!
 
Maybe write to the Central Bank making those points?

I think that their argument is the Prevailing Rate issue went through the TME.

That resulted in the €1,615 and opening the option of an appeal to the Appeals Panel and Central Bank.

So, if you like, you are in the TME but at the other end of it.

Brendan
 
Of course, you're correct I just sent a query outlining the above asking for an explanation. I'll post back what response it gets.
 
Hi All,
Got another letter from the appeals secretary :

The bank has responded to the Panel and has advised that it will be issuing a letter to me in due course with details of the relevant account(s) adjustments and payments. The Bank have also advised the Panel that this payment of additional compensation supersedes the Tracker Mortgage Redress compensation of €1,615 previously issued to you and should I not be satisfied with the payments made to date, the appropriate course of action would be to complain to the Bank, the FSPO or the courts.

I sent an email to the CBI asking.... Are AIB allowed to supersede a decisions on a process and payment made by the CBI under the redress scheme.... Are AIB now interfering with an independent appeal, surely these professional people on this panel can make a decision... that is what they are getting paid to do, or is it a case that they are afraid of getting it wrong, like in so many other appeals... that they have to run back to the CBI for help. This is the only time that I can see that they have picked up any bit of speed. This appeal is going on 18 months.. Can anyone post the running emoji..or a hashtag trackergate......
 
Another thread reminded me of that I'd send this email and missed the reply! I dug it out

This is what I sent


I’m hoping that you can help me understand the CBI’s reasoning in allowing AIB to exclude approx. 5600 accounts from the TME framework whilst allowing some 300 to be included from the 5900 Prevailing Rate Cohort. This entire cohort matches the criteria set out in the TME Framework doc as published here https://www.centralbank.ie/docs/def...ing-tracker-mortgage-examination.pdf?sfvrsn=4


From the Framework doc

Section 3.1
"The relevant period is the period of time from when the lender commenced offering Tracker Interest Rates to 31 December 2015"

These customers were all impacted between October 2008 and December 2013. The date 5th January which has been used to exclude the 5600 isn’t published anywhere?

Section 3.2
"where the underlying mortgage agreements provided for contractual rights to or options for Tracker Interest Rates at any stage during the term of the agreements"

Further clarified in section 3.3.1
"customers had contractual rights to be offered the option of having Tracker Interest Rates applied to their mortgage accounts at any stage during the Relevant Period and were not offered the option of having Tracker Interest Rates applied to their accounts at the appropriate and/or any stage during the Relevant Period.

and to determine whether or not all

contractual rights and obligations regarding Tracker Interest Rates were adhered to and/or honoured during the Relevant Period"

The FSPO has found that there was a contractual right to a tracker mortgage and these customers were not offered it.

In Section 3.6.1 TRANSPARENCY CONSIDERATIONS
" a particular term pertaining to the loan agreement was given different meanings by the lender at particular points in time or whether certain terms had dual meanings, with the potential to confuse customers"

The FSPO also found that the banks attempted to change the definition of “then prevailing rate” to the rate available to new customers was incorrect and their attempt to manufacture a rate several years later was flawed.

Considering the above I fail to see how this cohort are excluded from the principals of TME? It was the TME that identified them in the first instance back in March 2018 when the bank attempted to class this serious contractual breach as a “service failure”. AIB now appear to be attempting to do the same by setting an arbitrary date of 5 Jan 2009 to exclude clients and are stating it was agreed with the CBI. Could you elaborate and explain to me how these 5600 accounts are excluded from the TME?


The reply didn't really answer my questions

While the Central Bank does not have a statutory role in investigating individual consumer complaints, we use any information that we receive directly from consumers to guide the scope of our broader supervisory work

Please note that due to the confidentiality restrictions under which the Central Bank operates, we are unable to update you on our supervisory engagements with an individual lender.

As referenced in your email, the prevailing rate cohort were included as impacted under the Tracker Mortgage Examination and received a payment in 2018. The Central Bank designed the Examination Framework in such a way that impacted customers who remained dissatisfied with the offer from their lender, continued to have options to appeal to their lender’s independent appeals process, to the Financial Services and Pensions Ombudsman (“FSPO”) and the courts to raise their own individual personal circumstances for consideration.

Following a recent FSPO decision on an individual complaint from a customer belonging to the prevailing rate cohort, AIB has publically committed to applying the award from this FSPO decision, to other customers in the same cohort, which is in line with the expectations sets out by the Central Bank to lenders that if any individual outcomes arose from the FSPO or court processes that had the potential to impact customers more widely, that lenders then had to address this broader impact. Customers have the option of making a complaint to AIB and the FSPO to raise their own individual personal circumstances for consideration.

The 300 customers referenced in your email, have been identified as being further impacted under the Tracker Mortgage Examination. AIB have updated the attached link recently with information on this matter, which may be of assistance https://aib.ie/review-of-tracker-mortgages

Any further information relating to the application of the FSPO decision and the impact on your account should be sought from AIB directly.



I regret that we cannot be of more assistance to you.
 
Under Section 1.1.3 of Appendix B to the Central Bank's Principles of Redress, impacted customers are to have the option of receiving direct payments in respect of Adjusted Amounts as opposed to Adjusted Amounts being set off against the balance of their mortgage accounts.

Under the FSPO decision, the customer does not have this option and I imagine the Bank does not want customers to have this option. This may be why it is outside the TME.
 
Hi JP

You misunderstand 1.1.3. Read the full section and it should be clearer.

The adjusted amount refers to the difference between the amounts paid and the amounts which would have been paid.
That is only one part of the total overcharge. The other part is the reduction in the mortgage balance. The customer did not have the option of taking that in cash.

In any event, the Ombudsman ruled that there should be a 12% write down. He did not give the borrower the choice of having this in cash. And for the vast majority of people, it is better for them to have the write down.

Brendan
 
Back
Top