The Central Bank of Ireland has opened the doors for tens of thousands of bank customers to make PPI insurance refund claims against financial institutions who knowingly mis-sold them payment protection insurance policies.
The Central Bank took the unusual step of naming six banks involved in the mis-selling of payment protection insurance (PPI) policies following an investigation into allegations that thousands of policies were sold to customers – including the self-employed, homemakers and part-time workers – who could never make a claim under the terms of the insurance they bought.
The six banks named as perpetrators of the scandal by the Central Bank of Ireland were AIB, Permanent TSB, EBS, Bank of Ireland, Ulster Bank and GE Money – all of whom have been told to review their files on payment protection and refund customers who should never have taken out these policies.
Other financial institutions are also suspected of mis-selling PPI in Ireland and officials at the Central Bank have warned that the Central Bank is considering taking legal action against some as yet unnamed firms that it feels broke the rules when selling protection insurance on car loans and credit cards.
Both the Central Bank and the National Consumer Agency issued advice to customers that they need not do anything if they believe they are entitled to make PPI refund claims in Ireland, as they will be monitoring the progress of the refund procedures. However, this advice was attacked by a leading solicitor in Dublin, who claimed that the information provided by the Central Bank and the National Consumer Agency was wrong.
According to the solicitor, a six-year Statute of Limitations applies for PPI insurance refund claims in Ireland and, should a financial institution fail to refund a customer who subsequently complains to that financial institution and has their complaint rejected, the customer´s next step would be to present a complaint to the Financial Services Ombudsman (FSO).
The FSO has no authority to investigate PPI refund claims in Ireland when the insurance policy was taken out more than six years ago and, should the financial institutions take a long period of time to review their files on payment protection, thousands of customers could miss out on their entitlement to a refund of their PPI policy.
It is estimated that more than 340,000 payment protection insurance policies were sold in Ireland between 2007 and 2011 and customers who have been mis-sold PPI policies could be entitled to refunds of between 2,000 Euros and 3,000 Euros. However, the AIB and EBS have already acknowledged that it may be a year before the first refund payments are received by customers – implying that the Dublin solicitor could well be justified in his advice to bank customers that they should use a solicitor to make PPI insurance refund claims in Ireland.