Tracker Mortgage Scandal: Up to 30,000 customers could be affected

The tracker mortgage scandal will, “without a shadow of a doubt”, affect more than 30,000 customers before the authorities get to grips with the matter, far higher than the 15,000 currently estimated by the Central Bank.

That is according to the mortgage adviser who first revealed the scandal, Padraic Kissane, who appeared before the Oireachtas Finance Committee with affected customers of Permanent TSB and Ulster Bank waiving their anonymity to tell their stories.

Thomas Ryan suffered a stroke because of the stress Permanent TSB put him under.

His wife, Claire, had a nervous breakdown in 2015. She lost the power of speech under the pressure of their fight to be restored to a tracker mortgage rate.

He described the impact on his teenage children as “heartbreaking”.

Thomas, who was just 47 when he suffered a stroke in 2013, is just one of an estimated 30,000 borrowers and their families who has been affected by the multimillion euro overcharging as 15 banks refused to fulfil obligations to give customers the lowest interest rate in the market.

He was among four borrowers who told their stories to politicians at the Oireachtas Finance Committee yesterday.

In an emotional address, Mr Ryan explained the impact on his family of the financial pressure and long-running battle with the bank.

“As her husband, I find it pitiful and so unjust to see my wife’s previous confident and bubbly nature stripped away from her,” he said. “It is absolutely appalling. They have destroyed lives all over this country.

“There are people no longer with us over this. They have committed suicide. And they don’t particularly give a damn.”

Scores of people and families were put out of their homes over the last eight years after being refused their entitlement to a tracker. The Central Bank previously put the number of directly related repossessions at 100.

It previously estimated that up to 15,000 borrowers were affected by the issue and is due to update the committee next week. It’s now feared the true figure may be be twice that.

Financial adviser Padraic Kissane, who has advised hundreds of customers affected, said that, “without a shadow of a doubt”, the true figure will be 30,000.

Last week, Ulster Bank said it will have to pay more than €100,000 to some of its 3,500 customers caught up in the overcharging scandal.

Just 40 customers have been compensated so far by the bank.

Previously, it was revealed that 2,100 Bank of Ireland mortgages were restored to tracker rates when the issue was identified in that bank in 2010 and 2011.

There were also about 1,400 cases of customers being denied tracker rates involving Springboard Mortgages, which was a subsidiary of Permanent TSB.

The Central Bank cannot force banks to compensate homeowners for tracker issues prior to 2013.

The refusal of banks to allow customers to move on to trackers first emerged as far back as 2010 — the year taxpayers were lumbered with a multibillion-euro bailout of Ireland’s banks.

Mr Kissane said that bank customers had been treated with arrogance by the banks, a condescending attitude, and a lack of empathy and understanding.

“What moral compass do they possess?” he said. “It is financial abuse on a grand scale, contrived to deceive customers of their contractual rights.”

Hazel Melbourne, a customer of Permanent TSB, said the consequences on her family were “devastating, heartbreaking and totally unacceptable”.

“We are sick to the pit of our stomachs to think that all we had been through was avoidable. There was no need for our future to be changed,” Ms Melbourne told the committee.

“It just feels they are a giant cartel — you can turn nowhere for help or resolve as someone is always compromised by the banks. Where do the Irish people stand on this?”

Niamh Byrne, a teacher, was working on a temporary contract when she drew down a mortgage in 2006 from Ulster Bank to buy an apartment.

She was subsequently awarded €25,000 after being refused to return to the tracker rate after fixing for a short-term but the ruling did not force the bank to put her back on the low rate.

“That does not restore me to the position I should have been in,” Ms Byrne said.

“It is nine years, two months and 28 days since this happened. The whole of my 30s has been spent in this situation.

“It looks like there no end to it. It has been extremely stressful. It has a huge impact on my finances.”

Permanent TSB customer Helen Grogan said all she was looking for was justice.

“The one thing is the rage and frustration and anger that I was ripped off by the bank and duped by the bank, into thinking I had a product I could count on,” she said. “That’s the thing about this.

“I am coming up for retirement soon and I am going to have a mortgage after I retire. That is something I was trying to avoid.”

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