Pearse Doherty (Donegal, Sinn Fein)
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4. To ask the Minister for Finance if the Central Bank will reopen the investigation into the misselling of payment protection insurance in view of a court ruling that the failure of a financial service provider to alert a consumer to the fact that the insurance company involved was part or fully owned by the provider constituted misselling; and if he will make a statement on the matter. [23774/17]

Pearse Doherty (Donegal, Sinn Fein)
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I wish the Minister well following his earlier announcement. We have had many battles across the Chamber and this may be the last in this format.

I want to thank the Minister for his engagement so far.

The issue I have raised here is payment protection. It has been brought to my attention that there is potentially a whole new wave of payment protection insurance, PPI, policies that have been missold. I have contacted the Central Bank and am currently compiling additional information that it has requested from me. It appears that we have another scandal on our hands where the consumer has been cheated. Importantly, many might not be aware of the outcome of a court case that was held last year and the fact that the appeal was withdrawn earlier this year. It is my view on one financial institution, one insurance company, that all products that it sold after a certain date were missold as indeed the courts found in a particular test case. Is the Government going to examine the widescale nature of this issue?

Eoghan Murphy (Dublin Bay South, Fine Gael)
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As the Deputy is aware, the Central Bank is an independent organisation and it would not be appropriate for me to give it instructions on whether or not to conduct any investigation or to re-open a closed investigation.

In March 2014, the Central Bank, concerned about the sale of PPI, published a report on a review of the sale of PPI in Ireland. The focus of the review was where there was a possible detriment to consumers from unsuitable sales resulting in premiums being refunded. The review covered 11 firms and covered all PPI sales from 1 July 2007. I understand from the Central Bank that refunds of over €71 million have been refunded to approximately 83,500 customers since 1 July 2007, by these 11 credit institutions.

With regard to the court ruling referred to in the Deputy’s question, I understand that the Deputy has been in contact with the bank about this issue. The Central Bank is aware of this non-disclosure issue from previous supervisory engagements. However, the Central Bank is prohibited from commenting on any firm specifically and from disclosing confidential information concerning the business of a credit institution otherwise than in accordance with the supervisory directives, which include the Directive 2013/36/EU. Additionally, under section 33AK(3)(a)(i) of the Central Bank Act 1942, the Central Bank is obliged to report to An Garda Síochána any information that leads the Central Bank to suspect that a summary offence may have been committed by a supervised entity.

The role of the Minister for Finance is to ensure that there is an appropriate legal framework in place to ensure that consumers are properly protected and that financial institutions are regulated in an appropriate manner. Officials will study the ruling and consult with the Central Bank with a view to ensuring that consumers have the appropriate level of protection under the legislative framework.

Pearse Doherty (Donegal, Sinn Fein)
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My concern is that the Central Bank has carried out a review of 11 institutions, including three that I have very strong reasons to believe are involved in breach of the consumer codes by not disclosing their interests in the underwriter. That should have been picked up by the Central Bank when it carried out its review. It was not. A judge has now ruled in a test case that the defendant's conduct was capable of amounting to a misleading commercial practice within the meaning of section 43(2) and 43(3)(c). The appeal against that ruling has been withdrawn, so the ruling now stands.

The Minister of State will be aware that I have legislation which will hopefully be passed in this House quite soon that would lift the blanket ban on the six years rule in relation to making complaints against financial institutions, including insurance companies. This is another reason why we need to expedite that legislation. What I would like to hear from the Minister of State is his concern to create awareness with regard to this institution for thousands of customers. Let me explain what it did. It sold payment protection insurance to individuals, claiming that it had no interest in the underwriter, when it owned 100% of the underwriting insurance business. One other insurance company which we own 75% of had a similar case. Therefore, there is a reason why the Government would get involved in this, as it is the main shareholder in one of these institutions that, in my belief, were involved in this time of misselling.

Eoghan Murphy (Dublin Bay South, Fine Gael)
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I thank the Deputy for raising this matter. Of course the Department is concerned with the matter at hand. Officials in the Department are looking at the ruling and they are consulting with the Central Bank with a view to ensuring that consumers have the appropriate level of protection under the legislative framework. The Deputy will also be aware of the Minister's recent experience at a committee to speak about the issue of the Statute of Limitations, and officials are engaging with the Deputy on that point as well. I note the concerns that have been raised by the Deputy, both publicly and in the House, and I also note that the Central Bank, in its correspondence with the Deputy, requested further information to be provided to it so it could get a better understanding of what area and what entities the Deputy was speaking about. I understand that has taken place and the Deputy has responded to the Central Bank with that information.

Pearse Doherty (Donegal, Sinn Fein)
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I have responded and I will continue to engage with the Central Bank, but I think there is also a responsibility for the Minister and the Government to engage with Permanent TSB, for example, to ask it about this section, which the courts have ruled was tantamount to misselling a product, and why it did not disclose to people who bought payment protection insurance that it had a relationship with the underwriter, which it was legally responsible to disclose if that relationship was above 10%. The other institution which I have concerns about is Ulster Bank, which also needs to be investigated.

The test case taken was against a financial institution. I believe there were thousands of contracts entered into by that institution, which also had its products missold. The problem is that those consumers do not know it. They do not know about the case taken to the High Court last year. They do not know that the appeal was withdrawn. They do not know, in all likelihood, that what probably happened was that there was a settlement reached with this individual. I can only imagine. It is important that the Government steps in here, brings information to consumers and makes sure it is properly investigated.

Eoghan Murphy (Dublin Bay South, Fine Gael)
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It is important to note the work that the Central Bank already did in this area in relation to the review that it conducted and the report that it published. That led to the refunding of over €71 million to consumers, some 83,500 customers since 1 July 2007. Of course I recognise the concerns raised by the Deputy, and that is why officials from the Department are already studying the ruling that has been given. They are studying this with the Central Bank and officials there to see whether or not any changes need to be made to the legislative framework that underpin the protections for the consumer.