Credit union users ordered to pay €34m

OVER 2,000 judgments worth almost €34 million have been awarded against struggling credit union customers who have failed to repay outstanding loans since 2008, but this is just the “tip of the iceberg”, it has been warned.

Figures provided to the Irish Examiner by Vision-net.ie show that since 2008, credit unions have taken more and more cases to pursue hundreds of customers for non-payment of debts, year-on-year.

However, they are getting little satisfaction, with only eight repayments made since 2008, one of which came this year.

Court actions against customers for the year to December 3 soared to 769 judgments at a value of €13.5m, compared to 532 in the same period in 2010, worth €9m.

In 2008, just 341 judgments were made against customers. They start at a few hundred euro and reach the hundreds of thousands.

According to Vision-net managing director Christine Cullen, most of these are based on consumer loans, meaning they are against individuals, not businesses.

“There is little evidence to suggest that the debts are being paid back, however, it does hamper an individual’s credit for six years so it warns off others from falling foul, provided they do the necessary checks, which they clearly often didn’t across all sectors.”

She said the judgments were the tip of the iceberg.

“We are not allowed to view 90% of the judgments, which go unregistered due to a decision to take the public right of access away from the Irish Court Service back in October 2010.”

Figures for this year reveal that outside Dublin, where 312 judgments were registered at a value of €3.8m, Cork had the highest number of cases taken. Credit unions in the county took 89 cases against customers worth €2.4m. In Clare, 72 judgments were secured and in Laois, 45 judgments were awarded against customers.

The eight largest single judgments and where they were made in the period 2008-2011 were:

* Tipperary — €845,807;

* Galway — €726,712;

* Dublin — €405,354;

* Tipperary — €403,696;

* Galway — €401,475;

* Cork — €366,187;

* Cork — €301,048;

* Galway — €285,318.

Ms Cullen said it was clear that credit unions had not escaped the debt crisis fallout.

“There is evidence that in some instances, consumers were over-borrowing and it would also appear that some institutions may have been over-lending.

“Based on this evidence, there are lessons to be learned and a real need for smarter borrowing and smarter lending, coupled with informed decision making.”