Brian Cowen (Laois-Offaly, Fianna Fail)

The issues raised by the Deputy fall within the remit of the Financial Regulator. The Financial Regulator's annual report for 2006 identified a total of approximately €167 million relating to overcharging issues dating from the early 1990s to the present. The most recent information available from the Financial Regulator is that 36 financial service providers and over 250 individual charging issues were involved. My Department has asked the Financial Regulator to compile updated information in the format requested by the Deputy.

This area has been a major focus of the work of the Financial Regulator since its establishment in 2003. In responding to these issues, the main priority has been to ensure that all affected customers receive full and speedy refunds and that systems and controls are put in place to deal with the issues that led to overcharging so that future errors may be eliminated or minimised. This has been reflected in the substantial progress made in the reimbursement programmes and a decline in the number of new charging issues reported to the Financial Regulator, as financial service providers have adopted a much more rigorous approach to their internal controls, IT system processes and compliance procedures.

The Financial Regulator is closely monitoring the reimbursement programmes to confirm that they are carried out fully in line with the general principles established by the Financial Regulator in 2005. These ensure that financial service providers make all reasonable efforts to make refunds, with appropriate interest, to all customers who have been affected by overcharging and that the financial institution concerned cannot benefit in any way from amounts that cannot be repaid. Details of the main reimbursement programmes are published in the Financial Regulator's annual report.

It is important to note that the high number of overcharging issues identified is largely due to system reviews and allocation of additional compliance resources by credit institutions and insurers following the establishment of the Financial Regulator in 2003 as well as the reviews initiated by the Financial Regulator and the commencement of its customer-oriented on site inspections at that time.

Additional Information not given on the floor of the House.

In addition, under the Financial Regulator's consumer protection code, which came into full effect on 1 July 2007, regulated entities must speedily, efficiently and fairly correct any charging or pricing errors and notify affected consumers of any charging or pricing errors that may have a negative impact on the cost of a service or the value of a product provided.

The whole regulatory structure for Irish financial services was reformed with the establishment of the Financial Regulator, with its statutory consumer protection mandate, in 2003. The progress made on this issue is therefore a reflection of the work of the Financial Regulator in implementing a strong principles-based supervisory approach, in fostering a compliance culture in the financial services industry and in promoting and safeguarding the interests of consumers.

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