PPI Mis-Selling Scandal Spreads to Ireland – UK Banks Implicated!

PPI Mis-Selling Scandal Spreads to Ireland – UK Banks Implicated!

Posted by Rachel S. with 0 Comments

Image source: DavidIcke.com

As the £10bn PPI mis-selling scandal reaches epic proportions here at home, the madness has spread to Ireland as well. Sales of payment protection insurance from 2007 on have been ordered under review by Ireland’s Central Bank and if what’s happened here is any indication, we can expect news of a huge PPI mis-selling scandal there as well.

Over the past five years, more than 340,000 PPI policies were sold in Ireland. Since then, tens of thousands of Irish lost their jobs and turned to their payment protection policies for help with loan and credit card installments only to find their policies were invalid. PPI policies had more fine print than most other policies of this ilk and seemed designed to disqualify most circumstances that would warrant use of the cover.

Image source: Guardian.co.uk

The Central Bank has ordered seven major banks - most of them foreign – to write to customers who may have been mis-sold PPI. So far, the banks who’ve been ordered to write to borrowers include: Allied Irish Banks, Bank of Ireland, EBS, Permanent TSB, GE Money and Ulster Bank (owned by RBS). A seventh bank has been ordered to write to customers over PPI mis-selling but asked not to be named and the Central Bank is allowing them to remain anonymous for now. My guess is that it’s likely Barclays of Ireland since they are so mired in the PPI scandal here in England.

Central Bank’s director of consumer protection Bernard Sheridan says lenders will have to refund mis-selling victims all premiums plus interest for all bad policies and already estimates in the hundreds of millions of Euros for damages are being floated. As in England, Ireland’s Financial Services Ombudsman is seeing huge increases in complaints about PPI in recent months. In Ireland it’s still a small number – now at 410, up from 218 compared to the hundreds of thousands of complaints tumbling into UK regulators.

Image source: UK.Reuters.com

As in the UK, in Ireland, PPI was mis-sold to the self-employed, unemployed and people with pre-existing medical conditions. Even in cases where a payout would have been possible, PPI mis-selling was still prevalent by lenders requiring it as a prerequisite to a loan and others weren’t even aware they’d been enrolled.

Ireland’s Central Bank is encouraging people to wait to be contacted, but this may not be the best advice. There is a limit of time from incident to redress of six years in Ireland, so waiting for the banks may see many customers timed out of an opportunity for redress. Instead, in Ireland as in the UK, consumers who’ve had any type of loan or credit card over the last five years should dig out their documents or proactively contact their bank and ask to see documents related to PPI.

Image source: ABC.net.au