Central Bank fines firms €27m but policing criticised

The Central Bank has doled out €27.17m worth of fines to 54 financial institutions over the past four-and-a-half years.

Central Bank fines firms €27m but policing criticised

Of those, eight fines of over €1m were administered, with the largest sanction of €3.5m imposed on Ulster Bank in November 2014 following a major IT failure two years previously.

The failure left hundreds of thousands of customers without basic banking facilities for a 28-day period covering June and July 2012 and resulted in the largest fine ever administered by the Central Bank.

The issue, according to the Central Bank, threatened confidence in the operation of the retail banking sector and caused customers un- acceptable inconvenience as they were prevented from carrying out the most basic banking functions, including accessing cash from ATMs.

The Irish division of Combined Insurance Company of Europe — a niche insurance provider — faced similar repercussions in 2011 when it was ordered to pay €3.35m for 28 breaches of the Consumer Protection Code.

The previous record fine was applied after breaches covering a wider range of offences were uncovered, including overinsuring consumers and failure to recommend the most suitable products. Combined Insurance was also required to refund almost 8,000 customers to the tune of €2.15m.

The total value of the fines imposed were revealed in the Dáil in response to a parliamentary question from Sinn Féin finance spokesman Pearse Doherty.

Despite firms having been fined over €27m since 2011, Mr Doherty claims the Central Bank’s policing of wayward financial institutions will do little to deter future indiscretions. “These figures show that not many financial institutions, some of whom operate in the billions, will be losing much sleep at the prospect of the Irish Central Bank catching them.

“These fines amount, in most cases, to nothing more than a slap on the wrist. The question must be asked if the Central Bank has learned anything in recent years.”

Mr Doherty labelled as pitiful the €105,000 fine handed down to moneylender Provident Personal Credit — a subsidiary of British firm Provident Financial.

Since the commencement of the Central Bank Act 2013, the Central Bank can impose a monetary penalty up to €10m or an amount equal to 10% of the turnover of a firm — as opposed to the previous upper limit of €5m.

More in this section

News Wrap

A lunchtime summary of content highlights on the Irish Examiner website. Delivered at 1pm each day.

Sign up

Our Covid-free newsletter brings together some of the best bits from irishexaminer.com, as chosen by our editor, direct to your inbox every Monday.

Sign up