The Financial Services Ombudsman outlined six case studies to illustrate how it handled complaints from consumers.
In the first study a payment protection policy was sold with a home loan product. The complaint centred on an allegation that the policy wasn’t asked for or required. There was also a complaint made that the premiums weren’t obvious on bank statements and the complainant said they weren’t made aware of the features of the policy and the fact that the product was optional. However the lender proved the optional nature of its PPI and showed clear communication about it so the ombudsman rejected the complaint.
In another case a PPI was put in place to cover start-up loan but a subsequent claim on the policy was rejected. The business owners accused the lender of mis-selling the policy due to fact that benefit would never have been payable because of their employment status and because their eligibility was neither considered or appropriate from the outset. The complaint was upheld.
A mis-selling complaint in connection with PPI being added to a credit card account was also highlighted. Documentation showed that the complainant had an option to add or decline PPI when applying for product and had opted to make the purchase so a complaint of mis-selling was not upheld However the provider had not retained records appropriately which allowed the ombudsman to partially find against the lender.
In a fourth study a complaint made that a policy was not put in place to protect borrowings. There consumer making the complaint said that the provider had a responsibility to insist on alternative repayment facility in the event of non-payment of loan from normal means. It was not upheld as the complainant was aware of PPI policies being available but had made what was described as an informed decision not to avail of this optional product. The complaint was not upheld
Another study highlighted a provider’s refusal to offer ‘interest only’ repayments on a mortgage account on the basis that similar requests had been allowed in the past but the situation had still worsened. It said the only option was to consider voluntary sale or surrender of the property.
The ombudsman said it could not direct a provider to exercise its commercial and lending discretion in any particular manner, but could ensure that it abided by the Code of Conduct on Mortgage Arrears. In this case the code was complied with, however the reasoning behind the decision was not communicated appropriately to the complainant and the complaint was partly upheld with compensation of €300 being directed, as a result.
In a final case study, two mortgages in respect of a home had fallen into arrears. The complaint was that the provider had not entered into a mutually acceptable solution, had been reckless in its lending in the first place and that options had not been explored under the Code of Conduct on Mortgage Arrears. The ombudsman was unable to uphold any of the complaints cited.
