AIB admits wrongly charging credit card customers

ALLIED Irish Banks (AIB) has admitted that a number of its customers were wrongly charged for credit card payment protection insurance.

The annual levy of €16 was automatically taken from the accounts of customers who had already cancelled their policies for the optional insurance.

The bank said it had received approximately 30 complaints from people who noticed the money being debited from their accounts.

A spokesman later clarified this, saying it was an estimate and that the true figure of complainants might actually have been lower.

The Irish Financial Services Regulatory Authority (IFSRA) confirmed that it had received queries about the charging errors but said it was satisfied that AIB had resolved the complaints.

However, it warned consumers to always check their bank and credit card statements carefully to ensure there are no unauthorised transactions or payments, such as in the case of the AIB customers.

The insurance, which offers holders worldwide cover in the event that their card is lost or stolen, had been provided to AIB through a company called Sentinel.

The problem arose after this aspect of Sentinel’s business was taken over by British company Pinnacle Insurance.

Due to a records error in the takeover process not all customer accounts were properly updated.

A small number of customers who had previously cancelled their payment protection policies with Sentinel discovered the new insurer had debited the annual fee from their accounts.

AIB first received a complaint about this in May.

“In the few instances that have arisen, AIB is ensuring that appropriate refunds are made,” a statement from the bank said.

“Depending on the circumstances, some refunds have been made by AIB and others by the insurer.

“The incidence of error is small in the context of the size of business that was transferred to Pinnacle by the previous insurer.

“It is inevitable that there would be one or two problems in the initial stages, but AIB has ensured that these have been dealt with as they arose,” AIB said.

“Any customers who have said they cancelled cover with Sentinel have received or will receive a refund.

“It should be noted that, in any event, there is a provision in the policy to the effect that it can be cancelled within 90 days with a refund to the customer of the full annual premium (provided that no claim has been made on the policy in the meantime),” the bank said.