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Banks 'should pay back money plus compensation' over tracker mortgage scandal

Taoiseach Leo Varadkar was speaking in Cork
Taoiseach Leo Varadkar was speaking in Cork

The Taoiseach has said any banks that wrongly took customers off a tracker mortgage should apologise and pay back the money, plus compensation.

Leo Varadkar was speaking in Cork, where the Cabinet is meeting at University College Cork.

He said that as far as he is concerned, the deadline for this was yesterday.

Yesterday, four home owners appeared before an Oireachtas Finance Committee to explain the effects of the tracker mortgage scandal, where they were charged the wrong interest rates. 

Permanent TSB was accused of "taking a huge part" of families' lives away, leaving them "sick to the pit of their stomachs" with financial worry after the bank falsely charged extortionate mortgage interest rates.

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Hazel Melbourne, one of the bank's customers, told the committee: "Permanent TSB will never be able to compensate us as a family. They have taken a huge part of our lives away from us.

"To think that month after month, we were overcharged an extortionate amount and struggling to manage what was left of our finances, blaming ourselves and suffering horrific stress as a couple.

"Then to find out by a letter six years later that it was all down to so-called error made by our bank, to be honest it was inconceivable and still is.

"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 have been changed as it now has. It just feels like they are a giant cartel."

(L-R) Helen Grogan, Hazel Melbourne, Padraic Kssane, Thomas Ryan and Niamh Byrne addressed the Oireachtas Finance Committee

Padraic Kissane, a financial consultant who is campaigning for the return of tracker mortgages to customers, told the committee: "We have had enough of the banks saying 'we are looking to do right by our customers', enough of hollow apologies, enough of introducing rates that were never a tracker in the first place and most of all we have had enough of banks holding money that does not belong to them."

He described the "tracker debacle" as "financial abuse on a grand scale", which was designed to take away customers contractual rights.

Last week, the chief executive of Ulster Bank told the committee that the bank had identified 3,500 tracker customers who were wrongly removed from their rate, an increase from an earlier estimate of 2,000 customers.  

Gerry Mallon told the committee that the bank had contacted and returned existing customers to their tracker mortgage.

However, the committee was told that just 40 customers had been re-mediated. 

Mr Mallon told the committee that less than 14 or 15 people had lost their homes as a result of the tracker controversy.

Yesterday, Chairperson of the Finance Committee John McGuiness paid tribute to the four people who went public about the banks, but added that others are "afraid of the banks".

He said: "They are afraid of the big legal teams that can be put up against them and they are afraid that their lives will be further ruined by the activity of the banks.

"That has to change and that is down, in my opinion, to the Central Bank."