The Central Bank governor has said up to 15,000 mortgage owners were wrongly moved off tracker loans as he was told some were pushed into poor health or suicide and some had lost homes.
Governor Philip Lane faced a barrage of criticism as the bank’s supervisory powers were called into question by TDs and senators seeking answers for ripped-off customers.
The Irish Examiner has also established that banks may have to pay out over €500m in compensation and fines after wrongly overcharging customers.
Lenders and the Central Bank came under attack over the mortgage overcharging scandal as the standoff at Apollo House continued over its emergency use to house the homeless in Dublin City.
Mr Lane yesterday admitted to the Oireachtas Finance committee that as many as 15,000 bank customers were wrongly moved off tracker mortgages and possibly overcharged. The scandal relates to a widespread practice, started during the boom, where some 15 institutions are thought to have wrongly moved borrowers onto more expensive loans.
Frustrated committee members complained to Mr Lane that he and the bank would not provide figures and details about the overcharging.
Committee chairman John McGuinness suggested the regulator and governor were being “bullied” by banks, a charge Mr Lane denied.
However, the Fianna Fáil TD also added: “Those people [borrowers] have been pushed into poor health, some into suicide, because of the actions of banks. I think it is quite shocking in the way that you deal with this.”
“Some of the public think that they [bankers] should be in jail.”
Fine Gael’s Kieran O’Donnell asked if the Central Bank had “failed” to intervene since some of the overcharging emerged in 2010.
Fianna Fáil’s Michael McGrath said it was not good enough to give lenders a “slap on the wrist” over this when customers wronged were still being overcharged.
“People want answers as to how customers were being denied their contractual rights in terms of entitlement to a tracker mortgage rate,” said Mr McGrath.
Mr Lane told the committee a court action had delayed its intervention. More intrusive powers against banks were in place now, he pledged. But he also admitted the bank could have done more.
Mr Lane said some of the banks as well as individual bankers may now face fines, but he refused to say more because of ongoing inquiries, which may conclude by mid-2017.
However, the Irish Examiner understands the number of cases will likely exceed the new estimate of 15,000 cases and could cost the lenders in redress, compensation and fines over €500m.
Analysts are also counting the potential costs to banks. Owen Callan, an analyst at Investec Ireland, said his previous upper estimate of €225m would likely be exceeded as officials increased their tally of the numbers involved.
Meanwhile, activists continued to illegally occupy a disused building in the capital, Apollo House, to house 32 homeless people.
Its receivers yesterday applied to the High Court to have the building vacated on fire safety grounds and a case will be heard at 10.30am this morning.
The Government last night insisted there were enough beds in Dublin for homeless people but refused to comment on whether Apollo House campaigners should be removed.
A Government spokesperson said that, since December 9, a total of 145 new emergency accommodation beds were made available on Dublin’s Ellis Quay and Little Britain St, with 65 more due by the end of this week at Carman’s Hall on Francis St.
The figure brings the total of emergency beds in the city to 1,800, with a further commitment to increase homelessness funding by 40% next year.
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