Banks accused of operating illegally

The Professional Insurance Brokers Association has accused Irish banks of operating illegally and using sensitive customer information to pressure consumers into buying products.

According to PIBA, banks are defying consumer protection laws by monitoring account transactions and using the information to pressure consumers in to switching independently sourced products over to banks’ own products.

PIBA chief executive Diarmuid Kelly said: “These are illegal practices. The banks are flagrantly violating consumer protection laws and pressurising consumers who feel they have little choice because their credit facilities could be curtailed or withdrawn ”

Mr Kelly said the practice was more widespread outside of Dublin where there is a culture ingrained in the banks of pressurising clients to use in-house products instead of those offered by independent brokers.

“It seems that whatever the official position of the banks, there seems to be a culture in the banks where they put pressure on the customer,” he said.

“Subtle pressure that your overdraft facilities won’t be renewed unless you move to their products. Nothing is ever written down but it is subtly conveyed.”

Mr Kelly said PIBA members are also hearing of cases where certain banks are making the acquisition of one product contingent on another product being taken out, a clear breach of the Consumer Protection Code.

In a survey, PIBA said 76% of their 850 members had confirmed they had experienced such practices.

The office of the data protection commissioner said that they had met with PIBA about this matter and would act if PIBA could supply them with evidence.

“The position at present is that we are awaiting receipt from PIBA, its members, or any other party evidence of the practices that it has highlighted. We would then be in a position to take action under the Data Protection Acts,” a spokesperson for the office said.

A spokesperson for the National Consumers Association said: “If substantiated, we would of course be very concerned.

“We would always advise consumers to shop around when buying financial products and that they don’t have to buy a product from a firm they have an existing relationship with.”


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