Central Bank Must Create “Miranda Rights” - Prendergast
Labour MEP for Munster, Phil Prendergast, has called on the Central Bank of Ireland to make it mandatory for banks to explicitly inform customers facing mortgage arrears of the limits to unsolicited contact that creditors are bound to respect.
Speaking from Brussels, Ms. Prendergast, a member of the powerful Internal Market and Consumer Protection Committee, said: “In my dealings with families and communities, it is quite clear that many people struggling with debt are not aware that they have a statutory right to breathing space to assess their options calmly, in between creditor approaches.
“Undue harassment by creditors is in nobody’s interest, and that includes the creditors’. The strain from being constantly hounded can deprive any conscious individual of the ability to calmly assess their best options and act upon them.
“Upon the first successful contact with a customer regarding payment arrears, the Central Bank’s Code of Conduct on Mortgage Arrears should make it obligatory for creditors to tell their customers that, under the law, the bank or lending institution cannot make unsolicited contact with borrowers more than three times a month.
“Moreover, I think that the Central Bank’s December review of the rules, where they only consider an answered call or a voicemail as a successful contact, is a step backwards.
“I have received reports that automated systems are being used to reach borrowers several times a day so as to put them through to an official, without a voicemail message ever being left.
“This is akin to some sort of Chinese water torture for people struggling to keep a roof over their heads.
“Previous Central Bank policy was to consider missed calls are an instance of contact, and I fail to see what improvements this change has brought.
“It is quite ironic to see an industry that has always lobbied for light-touch regulation sticking to the letter of the law to circumvent the limitations on unsolicited approaches to borrowers.”
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