Michael Collins (Cork South West, Independent) | Oireachtas source

It saddens me greatly that the Rural Independent Group and I had to raise a motion regarding vulture funds in this House. Since the crash many homeowners, farmers, fishermen and business owners have worked very hard to keep afloat. Our State supported the banking sector in a big way. Now, some of the banks that we supported are dealing ruthlessly with their customers. Many loans are being sold at large reductions to foreign banks. Let us call them what they are, namely, vulture companies. These loans are acquired as cheaply as possible by the vulture companies, often at close to half the value of the original loan. The vulture companies then pursue the borrower for the full amount even though they have bought the loan at a hugely reduced rate. We have often seen these vulture companies pursue the borrower through the courts for the full amount and the evictions that resulted. Many homeowners, farmers, fishermen and business people give in under the pressure to these vulture funds and they surrender their property quietly out of public view because of the perceived shame and pressure. These cases do not hit the papers or media, but they are happening wholesale. The distress these people suffer is severe and the pressure they are under is unreal. Many people's health is affected. There is no doubt that this has led to many suicides throughout the country.

Families are paying a huge price. The Government has done a Pontius Pilate and washed its hands of this situation. It has allowed the banks to throw borrowers to the wolves. Banks and vulture funds are trampling on people, treating them in an appalling manner. Vulture funds are making a killing on the backs of hard-working, honest, Irish people. The banks tell us they are selling the loans of those people who are not engaging or co-operating to resolve the situation. We are told that it is only loans that are in default for more than two years that are being sold, but we are hearing a different story. People who were engaging with the banks and agreeing to a restructuring of their loans and had the capacity to meet their commitments suddenly were told that the bank was in the process of selling their loans to the vulture funds.

What has happened in this country since April last is nothing short of criminal. A bank that was rescued by the taxpayer is now selling the loans of farmers and business people throughout the country and mortgages to vulture funds at knock-down rates. They have been told that contracts were already signed with the vulture funds. The distress that this has caused is unimaginable. People are at risk of losing their homes, farms or businesses. The lives of many people are being destroyed by the heavy-handed and reckless behaviour of our banks.

The Government does not seem to care. It is allowing the banks to do what they like. In the case of Allied Irish Banks, AIB, the State owns over 70% of the bank. What steps have been taken to protect ordinary people from the ruthless actions of this bank? The Government is not in touch with ordinary people. This has to change. I propose that the banks should engage in a meaningful and realistic way with borrowers and be prepared to restructure their loans and give them the support to work their way out of their difficulties over time. Where the banks feel they are justified in selling these loans to the foreign banks or what we call vulture funds at knock-down rates, the borrower should be given an opportunity to purchase the loan at the same price as it is being offered to the vulture funds. Before a contract is entered into to sell these loans, the borrower should be informed well in advance. It is not good enough to inform the borrower that the contract to sell the loan has already been signed.

We cannot forget there are people and families behind these loans. Lives are being damaged and destroyed as a result. The banks and the Government must take a different approach.

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