The Financial Services Ombudsman, Ger Deering, says that the vast majority of complaints to his office in 2017 were resolved via mediation, and that the process is “proving to be a very fast method of resolving complaints”.

“Of the 2,370 complaints closed in 2017 through mediation, 57% were resolved in less than three months," said Deering. " The outcome of both mediations and adjudications can have a significant impact on the lives of real people.  In 2017, a total of 1,482 complainants received some form of financial compensation, rectification and redress.”

A total of 4,540 complaints were made to the Ombudsman in 2017, and 3,870 complaints were closed, some carried over from 2016. Mortgage complaints made up 26% of the total  while 42% to insurance products. Six percent of complaints related to investment products.

In respect of complaints closed, 171 legally binding findings were issued following adjudication. Of these, 14 complaints were upheld, and 80 were substantially, partly, or partially upheld, the Ombudsman’s annual review says.

Deering's annual review focuses specifically on mortgage-related complaints and includes case studies arising from both the formal investigation and adjudication process and the informal resolution process.

In Association with

He added: “These and other case studies demonstrate the types of solutions and redress available in circumstances where appropriate standards are not met by service providers, or where complaints are not resolved by the provider. “

The office is now known as the Financial Services and Pensions Ombudsman, as on 1 January 2018 the FSO merged with the Office of the Pensions Ombudsman and all functions of both bodies were transferred to the new FSPO under the terms of the Financial Services and Pensions Ombudsman Act 2017.

The Ombudsman says with mediated disputes, 19% were resolved in less than one month, 43%in less than two months, and 57% in less than three months.

Sample Determinations

• Brendan and Joanne asserted that their bank had failed to offer them an opportunity to restructure the loan on their residential investment property and had wrongfully appointed a receiver, resulting in the sale of the property at a very low price, leaving them with a large residual debt.

The Ombudsman found that the bank had acted within its strict legal entitlements but its decision to appoint a receiver was unfair because, although there were significant arrears on their family home, Brendan and Joanne’s level of arrears on the investment property was very low.

The sale of the property by the receiver for €35,000 yielded net proceeds of less than €21,000, leaving them with a substantial outstanding balance of €80,000 on the mortgage account. The Ombudsman directed the bank to reduce the debt by €75,000 with no interest accruing on the balance for 60 days from the date of the finding.

He also directed the bank to facilitate the transfer of the remaining debt of €5,000 to Brendan and Joanne’s principal private residence mortgage account, to enable them to discharge the debt over the remaining term of the family home mortgage.

• When John and Mary took out a principal dwelling house (PDH) mortgage in 2005, it was incorrectly classified by the bank as an investment mortgage. When the couple discovered the error and complained, the bank agreed to make a limited refund of interest overpaid.

However, it was not until the matter reached mediation that the bank provided John and Mary with a full refund of €18,000 for the interest overpaid and changed their loan to a principal dwelling house (PDH) mortgage.

• Deirdre and Conor complained about poor communication from their bank. While the Ombudsman could not investigate the details of the repayment capacity or sustainability of the commercial terms of a mortgage, he found that better communication was required from the bank in relation to several areas including: Conor and Deirdre’s proposal to sell the property; the bank’s position on a shortfall sale; whether the Mortgage Arrears Resolution Process applied; and whether a receiver had been appointed over the property.

A payment of €15,000 in compensation was directed for the provider’s failings.