Pearse Doherty (Donegal, Sinn Fein)
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87. To ask the Minister for Finance the approach taken by the Financial Services Ombudsman to complaints related to tracker mortgages and the lenders' implementation of the Central Bank's instructions; and if he will make a statement on the matter. [41010/17]

Paschal Donohoe (Dublin Central, Fine Gael)
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Firstly, I must point out that the Financial Services Ombudsman (FSO) is independent in the carrying out of his duties.  I have no role in the day to day workings of the office.

However, the FSO has informed me that, on receipt of a complaint, he reviews the complaint to assess whether it may be one which falls under the scope of the Central Bank Examination. If it is, the FSO writes to the financial services provider and requests confirmation of the status of the mortgage loan account by reference to the Examination.  Where it is confirmed by the financial services provider that a mortgage loan account is considered to be within the scope of the Examination, the FSO is of the view that the best way of ensuring that he has all of the necessary information to deal with such complaints is to await the outcome of the Examination. For this reason, the FSO considers it necessary to place these complaints on hold pending confirmation of the impact, if any, of the Examination on those mortgage loan accounts. 

The FSO does not have any oversight function with respect to the manner in which the financial services providers are conducting their Tracker Mortgage Examinations. The Central Bank of Ireland has laid down the Framework for the Tracker Mortgage Examination and the phases for a Bank to complete including Central Bank assurances that must be completed as part of that process.

I understand from the Central Bank that it invoked its powers under Section 22 of the Central Bank (Supervision and Enforcement) Act to set specific timelines for lenders to complete Phase 2 (the “Review Phase”) of the Examination and in line with those timelines, the Bank expect the vast majority of impacted customers to be identified by lenders by end September 2017. As the lenders’ reviews are subject to assurance work by the Central Bank, it is possible that additional impacted accounts may be identified after this date.  The Central Bank has and continues to challenge lenders through a combination of bilateral engagements and on-site assurance work to ensure that this Review Phase is completed as quickly and accurately as possible.  

The Central Bank has clearly articulated its expectations of lenders to provide appropriate redress and compensation to all impacted customers in line with prescribed principles for redress developed by the Central Bank. The timeframes for progression of the redress and compensation programmes vary from lender to lender, however, the Central Bank remains focussed on challenging lenders to ensure that they are progressing redress and compensation and that impacted customers are treated fairly. Some lenders have already commenced redress and compensation programmes and these programmes, along with the Central Bank’s assurance work, will continue beyond September 2017 for some lenders.

Lenders are also required to establish a dedicated unit to deal with any queries, complaints, and/or concerns that customers may have during the course of the Examination. The unit must continue to be available to deal with such queries, complaints and/or concerns for at least 6 months after the four phases of the Examination have been completed and until all complaints have been adjudicated on. The Central Bank will continue to engage with lenders in respect of the conduct of the Examination and will consider appropriate supervisory action, up to and including enforcement action, where necessary. I understand that a further update on the Examination will issue in October 2017.

When the Examination is over in respect of each complainant, the FSO will resume their investigation of those complaints which complainants want to pursue.