Brendan Burgess
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New Campaign to leverage EU Law as pathway to Justice for over 200,000 homeowners sold off to Vulture Funds
4 November 2024: A national campaign based on EU consumer law has been launched challenging the legality of mortgages that were allegedly mis-sold in Ireland in the years preceding the global financial crash in 2009. It is estimated that 15% of all existing Irish family home mortgages affecting over 200,000 people, now mainly aged over 50, could be affected.
Quartech Services t/a Misselling.ie has launched an online campaign (Join the Irish mortgage mis-selling claim - Join The Claim) to recruit thousands of family homeowners who were lent money pre-2009 and are now under pressure from vulture funds. The aim is to force the Irish regulatory and judicial system to apply the full rigours of EU law aimed at protecting consumers by forming a group of thousands of individual claimants.
Misselling.ie is led by banking insider Ben Hoey and solicitor Barry Lyons who together have spent the last four years researching and developing their legal strategy. They have already activated over 130 cases involving the main vulture funds in the Irish market - Pepper, Mars Capital, Cabot, BCM and Start Mortgages (now Mars Capital). Having carefully researched each homeowner’s individual case, where they find reasonable grounds to conclude that mortgages were originally mis-sold to homeowners, Misselling.ie apply EU consumer law, which is superior to Irish law, as the basis to win compensation for their clients. Where compensation is won it has the potential to put homeowners back in control of their mortgage and with greater control over the capital in their family home. All cases are taken on a ‘no win – no fee’ basis.
Speaking on the aspects of EU law that Misselling.ie is grounding mortgage holders’ cases in, solicitor Barry Lyons said: “We are bringing to bear two key provisions of EU law, which is superior to Irish law, to attain justice for our clients. These are the European Communities Unfair Terms in Consumer Contracts Directive 1995 (UTCD) as interpreted in a series of recent European Court of Justice (ECJ) cases where what constitutes unfair mortgage terms were clarified. The EU’s "principle of effectiveness” means that individuals must be able to exercise their rights under EU law to ensure it is directly effective as though enacted in national legislation. This means that for the first time what comprises unfair terms in mortgage contracts is clear and effective in Ireland.
Mr Lyons explained: “Prior to 2009 many mortgages were likely mis-sold on the basis of ‘unfair terms’ as defined in the UTCD. In these circumstances EU law requires that individuals can effectively exercise their rights under EU law, that it is “directly effective” as though in national law. It requires that national laws and procedures must not make it excessively difficult or practically impossible for individuals to enforce rights derived from EU law.”
He added: “This principle plays a key role in the interpretation and application of EU law in the national courts of Member States. It requires that national legal systems provide remedies and procedures that are effective in safeguarding the rights conferred by EU law. Having researched, developed and activated 130 cases, we believe that the Irish regulatory and judicial system is lagging in this principle of effectiveness based on how difficult, how long, how costly and ultimately how few mortgage holders have succeeded in being compensated to date, some 15 to 20 years after the mortgages were sold to them.”
Misselling.ie CEO, Ben Hoey worked for over 30 years within the financial services sector, with Bank of Ireland, Merrill Lynch and Kennedy Wilson among others. He explains that every eligible case is handled on an individual basis with the aim of invoking the application of EU law for the benefit of consumers as it is intended: “We start by making a complaint on behalf of our clients to the fund as the current owner of the home loan. If there isn’t a satisfactory outcome, we file a complaint with the Financial Services & Pensions Ombudsman (FSPO). If they fail to apply EU law for consumer protection, we will then take cases to the High Court in Ireland and so on until, if necessary, we appeal to the EU Court of Justice.
“We understand that many homeowners are under severe pressure from the relentless approach taken by funds who own their mortgages, some of whom are charging 9% interest rates on home loans. We are confident of the legal merits of our approach and are not charging anyone that instructs us unless we are successful in securing compensation for them”, Mr Hoey concluded.
Over the last number of years, the European Court of Justice (ECJ) has been very clear in its pronouncements on how consumer law needs to be interpreted across the Union, in particular, the Unfair Terms in Consumer Contracts Directive 1993 (UTCD), implemented in Ireland in 1995.
The principles espoused by the ECJ under the Directive include:
Misselling.ie’s Unique Process
Misselling.ie has undertaken an exhaustive mapping exercise to develop a robust process for claimants based on their processing c.150 cases over the last three years. These include several pathfinder cases.
The strength of a new claimant’s case can be determined based on the information they provide in a questionnaire, which is then aggregated with the outcome of research obtained from the existing cases (of which over 130 have already been filed with the FSPO). The standard mortgage contracts and accompanying documentation from all lenders in the period have been reviewed for the risks neither identified nor communicated. A mapping exercise has been carried out, benchmarking ECJ pronouncements and reinforcements of the principles and objectives of the UTCD to the conduct and contracts of lenders participating in the Irish credit boom.
Misselling.ie has also mapped the lenders’ contracts to the requirements set out primarily in the Central Bank’s Code of Practice 2001 and its Consumer Protection Code 2006 coupled with regulatory instructions issued directly to lenders in the period.
Misselling.ie believes that the probability of success is high when a claim meets the criteria embedded in their assessment model.
- New ‘Join the Claim’ campaign by Misselling.ie calls for strength in numbers of family homeowners to challenge Vulture Funds on a ‘no win – no fee’ basis.
4 November 2024: A national campaign based on EU consumer law has been launched challenging the legality of mortgages that were allegedly mis-sold in Ireland in the years preceding the global financial crash in 2009. It is estimated that 15% of all existing Irish family home mortgages affecting over 200,000 people, now mainly aged over 50, could be affected.
Quartech Services t/a Misselling.ie has launched an online campaign (Join the Irish mortgage mis-selling claim - Join The Claim) to recruit thousands of family homeowners who were lent money pre-2009 and are now under pressure from vulture funds. The aim is to force the Irish regulatory and judicial system to apply the full rigours of EU law aimed at protecting consumers by forming a group of thousands of individual claimants.
Misselling.ie is led by banking insider Ben Hoey and solicitor Barry Lyons who together have spent the last four years researching and developing their legal strategy. They have already activated over 130 cases involving the main vulture funds in the Irish market - Pepper, Mars Capital, Cabot, BCM and Start Mortgages (now Mars Capital). Having carefully researched each homeowner’s individual case, where they find reasonable grounds to conclude that mortgages were originally mis-sold to homeowners, Misselling.ie apply EU consumer law, which is superior to Irish law, as the basis to win compensation for their clients. Where compensation is won it has the potential to put homeowners back in control of their mortgage and with greater control over the capital in their family home. All cases are taken on a ‘no win – no fee’ basis.
Speaking on the aspects of EU law that Misselling.ie is grounding mortgage holders’ cases in, solicitor Barry Lyons said: “We are bringing to bear two key provisions of EU law, which is superior to Irish law, to attain justice for our clients. These are the European Communities Unfair Terms in Consumer Contracts Directive 1995 (UTCD) as interpreted in a series of recent European Court of Justice (ECJ) cases where what constitutes unfair mortgage terms were clarified. The EU’s "principle of effectiveness” means that individuals must be able to exercise their rights under EU law to ensure it is directly effective as though enacted in national legislation. This means that for the first time what comprises unfair terms in mortgage contracts is clear and effective in Ireland.
Mr Lyons explained: “Prior to 2009 many mortgages were likely mis-sold on the basis of ‘unfair terms’ as defined in the UTCD. In these circumstances EU law requires that individuals can effectively exercise their rights under EU law, that it is “directly effective” as though in national law. It requires that national laws and procedures must not make it excessively difficult or practically impossible for individuals to enforce rights derived from EU law.”
He added: “This principle plays a key role in the interpretation and application of EU law in the national courts of Member States. It requires that national legal systems provide remedies and procedures that are effective in safeguarding the rights conferred by EU law. Having researched, developed and activated 130 cases, we believe that the Irish regulatory and judicial system is lagging in this principle of effectiveness based on how difficult, how long, how costly and ultimately how few mortgage holders have succeeded in being compensated to date, some 15 to 20 years after the mortgages were sold to them.”
Misselling.ie CEO, Ben Hoey worked for over 30 years within the financial services sector, with Bank of Ireland, Merrill Lynch and Kennedy Wilson among others. He explains that every eligible case is handled on an individual basis with the aim of invoking the application of EU law for the benefit of consumers as it is intended: “We start by making a complaint on behalf of our clients to the fund as the current owner of the home loan. If there isn’t a satisfactory outcome, we file a complaint with the Financial Services & Pensions Ombudsman (FSPO). If they fail to apply EU law for consumer protection, we will then take cases to the High Court in Ireland and so on until, if necessary, we appeal to the EU Court of Justice.
“We understand that many homeowners are under severe pressure from the relentless approach taken by funds who own their mortgages, some of whom are charging 9% interest rates on home loans. We are confident of the legal merits of our approach and are not charging anyone that instructs us unless we are successful in securing compensation for them”, Mr Hoey concluded.
Over the last number of years, the European Court of Justice (ECJ) has been very clear in its pronouncements on how consumer law needs to be interpreted across the Union, in particular, the Unfair Terms in Consumer Contracts Directive 1993 (UTCD), implemented in Ireland in 1995.
The principles espoused by the ECJ under the Directive include:
- Stressing transparency and the need for consumers to understand financial implications of contracts.
- Terms must be clear and understandable to average consumers, including loan transfers.
- Importance of transparency in rate determination and changes.
- Risks must be clearly explained, especially with long-term implications.
- Emphasizes that products must be suitable for the consumer’s needs, highlighting the obligation of lenders to ensure suitability.
Misselling.ie’s Unique Process
Misselling.ie has undertaken an exhaustive mapping exercise to develop a robust process for claimants based on their processing c.150 cases over the last three years. These include several pathfinder cases.
The strength of a new claimant’s case can be determined based on the information they provide in a questionnaire, which is then aggregated with the outcome of research obtained from the existing cases (of which over 130 have already been filed with the FSPO). The standard mortgage contracts and accompanying documentation from all lenders in the period have been reviewed for the risks neither identified nor communicated. A mapping exercise has been carried out, benchmarking ECJ pronouncements and reinforcements of the principles and objectives of the UTCD to the conduct and contracts of lenders participating in the Irish credit boom.
Misselling.ie has also mapped the lenders’ contracts to the requirements set out primarily in the Central Bank’s Code of Practice 2001 and its Consumer Protection Code 2006 coupled with regulatory instructions issued directly to lenders in the period.
Misselling.ie believes that the probability of success is high when a claim meets the criteria embedded in their assessment model.