MEP Asks EU to investigate Tracker scandal

James Brown

Hayes asks EU to investigate Irish banks over tracker scandal
MEP Brian Hayes has made a complaint to the European Commission's Directorate-General for Competition in relation to the tracker mortgage scandal here.

Mr Hayes has asked the Commission to investigate "potential cartel activities" at Irish banks.

He said there are "clear indications" of "collaboration between the banks in order to intentionally deny customers their correct tracker mortgage rate.

"If Irish banks intentionally collaborated to ensure that customers did not get the correct interest rates on their mortgage product, this is effectively an example of controlling rates in an effort to restrict competition in the mortgage market and to share that market."

He added the Commission has "a raft of information which give them grounds for an investigation".
https://www.rte.ie/news/business/2017/1026/915405-hayes-asks-eu-to-investigate-irish-banks-over-trackers/

Hopefully this will lead somewhere. I think most of us are tired of politicians wringing their hands at how terrible somethings are yet doing little to address them. Frances Fitzgerald on this issue for example. Does she think that it's only now that peoples faith has been shaken in our banks? Well done Brian Hayes. We need the EU to police us.
Sadly, I wonder what it will cost the taxpayer this time, should the banks be found in the wrong?

djPSB

Country is corrupt to the core.

Politicians, the legal system, bankers, our police force and the majority of the top brass in our health care system. All corrupt and have failed the people.

People should be outside the central bank demanding answers and action. Time for white collars to be held accountable.

recedite

Banks were in the wrong, but lets look at what they did exactly.
They tricked a few stupid people into giving up tracker mortgages.
People were offered fixed rate mortgages at a good rate (which only ever happens whenever the banks know overall interest rates are not going to rise for a while) Then when the fixed rate term was over, they told these people they had to go onto standard variable rate instead of going back to the tracker rate.

Tracker rate is effectively ECB base rate + a modest fixed inbuilt profit for the bank.
Standard variable rate is ECB base rate + an uncontrolled profit for the bank.

So why are those of us who never had access to the cheaper tracker rate at all, supposed to feel sorry for these people who had it, but gave it up?

The real scandal is that the standard Irish variable rates are the highest in the EU, despite all the EU banks getting loan funding from the ECB at the exact same base rate.

Its profiteering by a few lazy parasites, which puts our whole economy at a competitive disadvantage compared to the neighbours. It lowers the spending power and productivity of the workforce in this country.

James Brown

recedite wrote: »

Banks were in the wrong, but lets look at what they did exactly.
They tricked a few stupid people into giving up tracker mortgages.
People were offered fixed rate mortgages at a good rate (which only ever happens whenever the banks know overall interest rates are not going to rise for a while) Then when the fixed rate term was over, they told these people they had to go onto standard variable rate instead of going back to the tracker rate.

Tracker rate is effectively ECB base rate + a modest fixed inbuilt profit for the bank.
Standard variable rate is ECB base rate + an uncontrolled profit for the bank.

So why are those of us who never had access to the cheaper tracker rate at all, supposed to feel sorry for these people who had it, but gave it up?

The real scandal is that the standard Irish variable rates are the highest in the EU, despite all the EU banks getting loan funding from the ECB at the exact same base rate.

Its profiteering by a few lazy parasites, which puts our whole economy at a competitive disadvantage compared to the neighbours. It lowers the spending power and productivity of the workforce in this country.

That only sits well if we see the banks as people out to get you and their customers as willing victims, when in reality, banks are vouched for by the state, supported by the state and supposed to be trustworthy, in the least, towards their own customers. Has it got to the stage where it's every man for himself and anyone trusting any institution be it semi-state or practically state owned is a big ejit?
We cared about the poor folk lost money gambling on stocks, why we should care about people placing trust as customers in institutions is more about having standards or really just letting cowboys do as they like. We should in the least keep up the pretense of having a society with standards, in case Moody's are watching.

recedite

I wasn't excusing the banksters; they are crooks IMO.

My point is that a small number of people were getting a fair deal while most borrowers were being royally ripped off (and still are).

This small minority lost their discount for a while, and now there is a big fuss about restoring it, and compensating them for the time they spent being ripped off at the same rate as everyone else.

Does it not seem strange to you?

James Brown

recedite wrote: »

I wasn't excusing the banksters; they are crooks IMO.

My point is that a small number of people were getting a fair deal while most borrowers were being royally ripped off (and still are).

This small minority lost their discount for a while, and now there is a big fuss about restoring it, and compensating them for the time they spent being ripped off at the same rate as everyone else.

Does it not seem strange to you?

I went off on my own one, should have been clearer.
My concern is the lack of accountability is spreading from our politicians and Garda, back to the banks. It's becoming a very uncomfortable little country to do business have confidence in.

View

I would presume that the Commission will respond by pointing out that this isn’t an EU issue but, rather, a domestic one and one for our domestic regulatory bodies to deal with instead.

James Brown

View wrote: »

I would presume that the Commission will respond by pointing out that this isn’t an EU issue but, rather, a domestic one and one for our domestic regulatory bodies to deal with instead.

I'd have confidence in an outside and/or EU based investigation.

View

Matt Barrett wrote: »

View wrote: »

I would presume that the Commission will respond by pointing out that this isn’t an EU issue but, rather, a domestic one and one for our domestic regulatory bodies to deal with instead.

I'd have confidence in an outside and/or EU based investigation.

It isn’t an issue of whether you have confidence or not. This is a domestic issue and hence it is up to us to deal with it domestically. There would need to be an “EU wide” (or “part EU wide”) basis for the EU Commission to be involved.

James Brown

View wrote: »

It isn’t an issue of whether you have confidence or not. This is a domestic issue and hence it is up to us to deal with it domestically. There would need to be an “EU wide” (or “part EU wide”) basis for the EU Commission to be involved.

Just giving my opinion. I don't claim to carry any sway with EU rulings.

Good loser

recedite wrote: »

I wasn't excusing the banksters; they are crooks IMO.

My point is that a small number of people were getting a fair deal while most borrowers were being royally ripped off (and still are).

This small minority lost their discount for a while, and now there is a big fuss about restoring it, and compensating them for the time they spent being ripped off at the same rate as everyone else.

Does it not seem strange to you?

Part of the reason banks charge higher variable rates is because so many of their customers have trackers. Also they are allowed repossess very few houses plus now you have insolvency practitioners getting debts written off.
If the tracker rates were higher than 'standard variable' there would be no tracker 'scandels' and absolutely no demand to be put on them. Could that yet happen?

listermint

Good loser wrote: »

Part of the reason banks charge higher variable rates is because so many of their customers have trackers. Also they are allowed repossess very few houses plus now you have insolvency practitioners getting debts written off.
If the tracker rates were higher than 'standard variable' there would be no tracker 'scandels' and absolutely no demand to be put on them. Could that yet happen?

Mad that's a rumor spread by the banks because Irish banks are making three times more profitable than their European counterparts.


https://www.google.ie/amp/s/amp.independent.ie/irish-news/the-great-bank-profits-ripoff-36249531.html


So I suppose ignore rumors that origin from banks spokespeople

recedite

listermint wrote: »

https://www.google.ie/amp/s/amp.independent.ie/irish-news/the-great-bank-profits-ripoff-36249531.html

This is the real scandal...

The findings conclusively show that Irish home borrowers are charged an average interest rate of 3.2pc against a 1.9pc eurozone average while businesses here are charged an average 5.1pc against the eurozone average of 2.3pc.

All the Eurozone is supposedly operating under the same currency and the same ECB base rate, but in reality the eurozone is far from being a level playing field.

If the govt. were less short sighted, they would see that Irish workers and Irish businesses are being put at a competitive disadvantage, as compared to say their German equivalents, due to this extra burden imposed by greedy Irish banksters. The same greedy banksters that are now pushing behind the scenes to have their pay caps lifted "in the national interest".

At the depth of the economic crash, the Government imposed a €500,000 cap on bankers’ salaries and banned bonuses due to the damage the sector had caused the country.

Hitman3000

View wrote:

It isn’t an issue of whether you have confidence or not. This is a domestic issue and hence it is up to us to deal with it domestically. There would need to be an “EU wide†(or “part EU wideâ€) basis for the EU Commission to be involved.

I remember the EU having an issue with the practice of Insurance companies here, not sure why the banks should be treated as a domestic issue. They have clearly shown contempt for agencies of the state.

View

Hitman3000 wrote: »

View wrote:

It isn’t an issue of whether you have confidence or not. This is a domestic issue and hence it is up to us to deal with it domestically. There would need to be an “EU wide†(or “part EU wideâ€) basis for the EU Commission to be involved.

I remember the EU having an issue with the practice of Insurance companies here, not sure why the banks should be treated as a domestic issue. They have clearly shown contempt for agencies of the state.

Well without some sort of idea about what practice you are referring to it is hard respond to that comment. If the practice involved another member state (or states), there could have been a question of whether it breached EU law. Equally if the practice is specifically banned under EU law (as illegal state aid is or sexual discrimination when underwriting a policy) there is a role for EU investigation. If it is just poor competition as no one wants to rock the boat and/or active collusion to prevent it, then it is up to the domestic authorities.

James Brown

View wrote: »

Well without some sort of idea about what practice you are referring to it is hard respond to that comment. If the practice involved another member state (or states), there could have been a question of whether it breached EU law. Equally if the practice is specifically banned under EU law (as illegal state aid is or sexual discrimination when underwriting a policy) there is a role for EU investigation. If it is just poor competition as no one wants to rock the boat and/or active collusion to prevent it, then it is up to the domestic authorities.

I believe the motor industry insurance issue? Something that was known about for years but took the EU to tackle. Thankfully we might see similar here. They've a remit to protect the welfare of individual EU members, people.

View

Matt Barrett wrote: »

View wrote: »

Well without some sort of idea about what practice you are referring to it is hard respond to that comment. If the practice involved another member state (or states), there could have been a question of whether it breached EU law. Equally if the practice is specifically banned under EU law (as illegal state aid is or sexual discrimination when underwriting a policy) there is a role for EU investigation. If it is just poor competition as no one wants to rock the boat and/or active collusion to prevent it, then it is up to the domestic authorities.

I believe the motor industry insurance issue? Something that was known about for years but took the EU to tackle. Thankfully we might see similar here. They've a remit to protect the welfare of individual EU members, people.

The EU has if I recall correctly a specific task of tackling (overt) sexual discrimination which is why MEPs and the member states approved the measure for motor insurance.

It has no specific task to ensure that mortgage holders must be able to avail of the cheapest possible mortgage rate.

In fact, there was a proposal for a single EU (or possibly Eurozone) mortgage market floated by the EP or Commission around 10-15 years ago. That would have meant you could have gotten your mortgage from from any bank in the EU (or possibly Eurozone) via an open mortgage trading system. Obviously that would have required some regulation so that companies would be underwriting standardised EU mortgage packages as it wouldn’t work with dozens of packages based on differing National mortgage standards. Technically it was perfectly doable to create such an EU wide market but many member states refused point blank to go down the road of doing so.

We were, of course, one of those objecting member states. The argument at the time was that us exercising our sovereignty meant we had a more “flexible” mortgage market. Arguably that point was true but no one was interested in figuring out whether the flexibility in our domestic market would operate in the banks’ interests or in that of consumers.

recedite

View wrote: »

In fact, there was a proposal for a single EU (or possibly Eurozone) mortgage market floated by the EP or Commission around 10-15 years ago. That would have meant you could have gotten your mortgage from from any bank in the EU (or possibly Eurozone) via an open mortgage trading system. Obviously that would have required some regulation so that companies would be underwriting standardised EU mortgage packages as it wouldn’t work with dozens of packages based on differing National mortgage standards. Technically it was perfectly doable to create such an EU wide market but many member states refused point blank to go down the road of doing so.

We were, of course, one of those objecting member states. The argument at the time was that us exercising our sovereignty meant we had a more “flexible” mortgage market. Arguably that point was true but no one was interested in figuring out whether the flexibility in our domestic market would operate in the banks’ interests or in that of consumers.

Never heard of it. But if true, whichever Irish politician objected to the proposal should be lynched for high treason and crimes against the Irish people.

James Brown

I think the Irish state is often too happy to let such things go on as 'that's the way it is'. Laws are open to change and we certainly need outside authorities picking up the slack. I would have no confidence in a government led investigation. We would need, preferably unbiased, outsiders for the best possibility of an honest review that may lead to action.