WEXFORD MAN TELLS OF THE TRAUMA CAUSED BY BANK
A WEXFORD businessman has spoken of the trauma, stress and suffering caused to him and his wife as a result of the refusal of a bank to restore them to a tracker mortgage rate.
Thomas Ryan, from Wexford town, was one of four borrowers from various banks who waived their anonymity and told an Oireachtas Finance Committee meeting about their experiences at the hands of the banks.
‘It is absolutely appalling. They have destroyed lives all over this country,’ said Mr Ryan, who attended the hearing with his wife Claire after a long, but ulimately successful against their bank in the courts.
‘There are people no longer with us over this. They have committed suicide. And they don’t particularly give a damn.
‘I have heard some of the submissions here in the last few weeks from some of the banks – it is an absolute disgrace, the generic, legalistic garbage they are churning out. It is appalling and an absolute disgrace. There’s no other words for it,’ said Mr Ryan.
Mr Ryan was a Permanent TSB customer who challenged its refusal to give him the tracker rate. He said the banks should be forced into making amends.
He suffered a stroke in 2013 at the age of 47 and his wife had a nervous breakdown in 2015, losing the power of speech under the pressure of their fight to be restored to a tracker mortgage rate.
‘This was a horrific experience, not only for Claire herself but also our children as she went through long periods nervously stuttering and stammering without uttering an understandable word,’ he told the committee.
‘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.
In his address to the committee, Mr Ryan explained the impact on his three children of the financial pressure and long-running battle with the bank.
‘The extreme stress effects on the mental wellbeing of our teenage children is absolutely heartbreaking,’ he said.
In 2011, Mr and Mrs Ryan won a High Court order requiring the Financial Services Ombudsman to reconsider his rejection of their complaint over losses of more than €34,000 they said they suffered due to the alleged ‘sharp practice’ of Permanent TSB when they renegotiated interest rates on their €1 million mortgages.
At the time, Mr Justice John MacMenamin made the order over Permanent TSB’s failure to disclose to the ombudsman or couple a ‘highly relevant’ transcript of a recorded phone conversation between it and Thomas Ryan on the renegotiation of interest rates.
Financial institutions must disclose all relevant documents concerning complaints against them, he ruled. He found the bank failed to act in good faith in its disclosure procedure, and he dismissed its ‘surprising’ arguments that it had no such ‘good faith’ duties.
He was ruling on an action the Ryans arising from their efforts in early 2009 to break out of ‘fixed-rate’ interest terms on mortgages of more than €1 million on their family home in Wexford and a property in Dublin.
Mr Ryan said he had heard the bank was allowing mortgage holders to break out of fixed-term rates for a period without penalty.
After contacting a customer phone line in early 2009, he claimed he secured agreement on cheaper interest rates for a time and believed he could revert in the future to an earlier tracker rate.
The bank’s later insistence he could not revert to the tracker rate meant interest charges of €4,290 a month, rather than €2,090, from December 2009, he claimed, and accused the bank of ‘sharp practice and opportunism’.
The issue was referred to the ombudsman, but neither the ombudsman nor the couple knew the bank had recorded the phone conversation and that a transcript of it informed the bank’s response to the complaint. In rejecting the complaint, the ombudsman found the couple were adequately warned of the consequences of changing to a variable rate during a fixed-rate term.
In his judgment, Mr Justice MacMenamin said clarity in any negotiations on mortgage conditions was essential. The ombudsman’s decision should be quashed due to two errors, he ruled.
The most ‘fundamental’ error was the bank’s failure to provide the transcript of the phone call with Mr Ryan, or, at the very least, notice of its existence. The second arose in a letter to the bank from an official in the ombudsman’s office seeking any documents ‘which the bank considers relevant’ to the complaint. It was for the ombudsman, not the bank, to decide what material was relevant.
Padraic Kissane, the financial advisor who has been leading the charge to get customers restored to the correct rates, told last week’s Oireachtas hearing that customers had been treated with arrogance by the banks, a condescending attitude and a lack of empathy and understanding.
Mr Kissane also warned he has a host of cases of bank staff and people working for legal teams and auditors associated with the banks who want to challenge the rates they have been put on but are worried about the consequences for their careers.
And he told the committee there was a cartel in operation in Ireland’s mortgage market.
He compared one of the best rates on offer at the minute – a 10-year fixed mortgage from KBC at 2.95% compared to a 10-year fixed rate in Germany of 1.15%.