Alex White (Dublin South, Labour) | Oireachtas source

I thank Deputy McGrath for raising this important issue.

I have been advised by the Central Bank that it is conducting an ongoing investigation into the sale of payment protection insurance, or PPI, by firms from July 2007. In September 2012 the Central Bank broadened its investigation to include a number of other banks and credit institutions. Approximately 340,000 PPI policies have been sold by banks or credit institutions since 2007. The Central Bank issued an update on its ongoing investigation into the sales of payment protection insurance policies on 17 May 2013. Ten firms are currently undertaking reviews of their payment protection insurance sales. At the request of the Central Bank, the firms previously informed all their customers included in the PPI sales review of their intention to provide updates to them as the review progresses. The firms have commenced writing to their customers who purchased PPI in July 2007 to inform them of the outcome of the review as it relates to their situation. Approximately 13,000 customers have received letters in the last two weeks. The Central Bank is advising customers who receive a letter and who have any questions to contact their banks or credit institutions directly.

It is too early at this stage to comment on either the number of consumers who will receive refunds or the total amount to be refunded. Some firms may be able to indicate to their July 2007 customers by how much they will be restituted but the majority will not until customers have decided whether they wish to have restitution or to keep the policy subject to further suitability assessment. The Central Bank will make a statement at the conclusion of the overall process.

Throughout 2013, firms will continue to conduct the review and will directly contact all other PPI customers included in the review with the outcome of the ongoing review. The Central Bank will continue to require firms to take an orderly, co-ordinated and consistent approach to the review and will monitor progress on an ongoing basis with the firms involved and with the independent third party overseers who were appointed at the request of the Central Bank. The Central Bank's update on its ongoing investigation into the sale of payment protection insurance is available on the website www.centralbank.ie.

On the issue more generally, the Central Bank's consumer protection code is applicable to all entities regulated by the Central Bank. These regulated entities include State-supported banks and financial institutions. The code requires, among other things, that a regulated entity must ensure that in all its dealings with customers and within the context of its authorisation it acts honestly, fairly and professionally in the best interests of its customers and the integrity of the market and with due skill, care and diligence in the best interests of its customers. Any breach of the code may be considered under the Central Bank's administrative sanctions procedure. In addition, as the House will be aware, the Financial Services Ombudsman was set up to adjudicate on unresolved disputes between complainants and financial service providers in an independent and impartial manner.

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