The Central Bank has secured a High Court order extending a suspension notice against the managing director of a Dundalk-based company, European Mortgage Call Centre Ltd, pending a fitness and probity investigation following complaints by two clients of the firm.
The complaints include alleged failure to return, or return in full, monies paid for mortgage deposits despite mortgage approval having not been secured.
The president of the High Court, Mr Justice Peter Kelly, said he was satisfied extending the validity of the suspension for another three months of James Cumiskey, of Siabh na Glough, Jenkinstown, Dundalk, was necessary with a view to protecting the public pending completion of the regulator's investigation within the three months.
The judge stressed, as had counsel for the Central Bank, that Mr Cumiskey has not yet had an opportunity of appearing before the Central Bank and giving an account concerning the issues under investigation. There was also a reference to his having medical difficulties.
Mr Cumiskey was not in court but was represented by counsel who said solicitors intended to come on record and indicated there would be consent to the firm not practising pending the bank's investigation.
In seeking the extension of the suspension, Paul Anthony McDermott SC, for the Central Bank, said European Mortgage Call Centre Ltd - European Mortgages - is authorised by the Central Bank as an investment intermediary and insurance intermediary but is not authorised or registered as a mortgage intermediary.
In court documents, the bank said European Mortgage's license to act as mortgage intermediary expired in 2012 but the bank was concerned the firm continued to advertise and provide services as a mortgage broker.
Last January, the Financial Services and Pensions Ombudsman had notified the Central Bank of separate allegations by two men against Mr Cumiskey, it said.
Both claimed they sought assistance from him in securing a mortgage to buy a home, that he asked them to pay him a deposit to secure a mortgage on the basis a lending institution would need to see proof of deposit monies in Mr Cumiskey's account.
The men said they paid deposits of €27,000 and €20,000 and sought the return of those two months later after mortgage approval was not forthcoming.
Both alleged their deposits have not been repaid in full despite ongoing efforts by them in that regard and commitments by Mr Cumiskey to do so.
One of the men contacted the gardai in October 2018 about the matter and gardai seemingly advised Mr Cumiskey had done the same thing to another individual the previous year but had repaid the money after gardai spoke to him, the bank said.
The bank said it was alleged gardai then contacted Mr Cumiskey about the more recent complaint and he had said he would repay the complainant within three weeks. To date, only €4,400 appeared to have been refunded to the complainant.
The second complainant also alleged only very small payments have been made by Mr Cumiskey towards refunding his deposit.
The Central Bank said there is a "history of extended regulatory engagement" with European Mortgages since 2013, particularly concerning the late submission of annual returns and "Key Risk Indicator breaches".
On February 4th last, the Central Bank, in accordance with provisions of the Central Bank Reform Act 2010, commenced a Fitness and Probity investigation and issued a suspension notice concerning Mr Cumiskey based on its opinion there were sufficient grounds to suspect he may have participated in serious misconduct in relation to the business of a regulated financial service provided and there were sufficient reasons to suspect his fitness and probity to perform the relevant controlled functions.
In his ruling, Mr Justice Kelly said the Central Bank has functions concerning fitness and probity requirements for individuals who perform controlled functions in regulated firms.
In this case, it was alleged substantial sums were given to Mr Cumiskey and he has not dealt with those for the purpose required and has not returned them in full.
Pending investigation, the bank can issue a suspension notice to protect consumers and the court was satisfied in this case to grant the bank's application extend the suspension, the judge said.