Belfast Telegraph

Leo Varadkar threatens banks with tax hikes over tracker mortgage response

The Taoiseach has threatened banks with tax hikes over their failure to pay back and compensate customers for the tracker mortgage scandal.

Watchdogs in the Central Bank revealed the growing scale of the overcharging with 23 homeowners and 79 investors having been forced to hand over the key to homes after falling into arrears.

At least 13,000 borrowers were forced on to higher interest rates after their banks refused them their right to a low-cost tracker.

The chiefs of Ireland's main banks are to be called in to meet Finance Minister Paschal Donohoe next week over the scandal.

Leo Varadkar said the Government had lost patience with the banks and that his cabinet colleague would admonish bankers for their slow response to the affair.

"The Government will take further action if we don't see further progress and much more quickly, whether that's through enhanced powers for the Central Bank or increased taxation imposed on the banks," the Taoiseach told the Dail.

It has been estimated that at least 30,000 borrowers and their families have been affected by the multimillion-euro overcharging scandal as 15 banks refused to fulfil obligations to give them the lowest interest rate in the market.

Four borrowers went public last week with the trauma - physical, psychological and financial - they have faced after being refused their right to a tracker mortgage rate.

Ulster Bank and Permanent TSB are currently facing enforcement from the Central Bank over their handling of the issue.

Two other banks are also in the middle of an enforcement investigation but they have not been named.

Mr Varadkar said: "The Government believes that the behaviour of the banks in relation to removing people from tracker mortgages was scandalous.

"We also believe that the banks have been dragging their feet in solving their problems at a real human cost.

"Some have lost their homes. Others have lost investment properties and aside from the financial cost there is of course the impact on people's mental health and wellbeing.

"It's our view that the people affected should have had their tracker mortgage restored and should have been compensated and as a result the Government has lost patience."

The Central Bank cannot force banks to compensate home owners for tracker issues prior to 2013.

The refusal of banks to allow customers to move on to trackers first emerged as far back as 2010 - the year taxpayers were lumbered with a multibillion-euro bailout of Ireland's banks.

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