I move amendment No. 1:
In page 3, to delete lines 20 to 26 and substitute the following:
“(c) by substituting the following definition for the definition of “retail credit firm”:
“ ‘retail credit firm’ means a person prescribed for the purpose of paragraph (g) of other person who holds itself out as carrying on a business of, and whose business consists wholly or partly of, providing credit directly to relevant persons or owning such credit or both, but does not include—
(a) a person who is a regulated financial service provider authorised by the Bank or another EEA regulator to provide or own credit otherwise than under this Part, or
(b) a person who is an authorised credit intermediary under Part XI of the Consumer Credit Act 1995 when carrying on the activity of a credit intermediary, or
(c) a person who provides credit on a once only or occasional basis, but only if the provision of the credit does not involve a representation, or create an impression (whether in advertising, marketing or otherwise), that the credit would be offered to other persons on the same or substantially similar terms, or
(d) a person who is exempted, or who belongs to a class of persons that is exempted, under section 29A from being required to hold an authorisation as a retail credit firm;”.”.
I will speak to amendments Nos. 1 and 3, the Sinn Féin amendments. In respect of amendment No. 1, there is a difficulty for many who find that their mortgage holder is no longer regulated. A total of 18,000 people fall into this group, approximately 13,000 of whom are with the Irish Bank Resolution Corporation, IBRC. The stories other elected representatives and I have heard about their experiences are amazing. The danger is that the process has opened the door to firms which seek to profit-strip from the crisis and have received reductions or write-downs on the size of the mortgages. For example, they may have bought mortgages at 60% of the market value and, therefore, see an opportunity to sell houses as soon as possible to realise a profit. The system has created a commercial opportunity that works against the interests of citizens whom we are here to represent and protect.
One individual who was in Leinster House when this legislation was in the Dáil was a couple of days behind in his mortgage repayments. He received a letter from the mortgage provider, which was outside the system of regulation, for repossession. This shows that these guys were jumping at the opportunity to repossess homes. I know another individual who bought a house and was €2,000 in arrears for four months, whose house was forcibly sold. When it was sold, he was left with a debt of €80,000. I think the Minister of State would agree that kind of practice is shocking and disgusting.
The fact that mortgages were sold off in the first place is significant. We were not able to restructure debts for citizens, or do any restructuring or write-down of debt for those in mortgage distress, yet these vulture capitalist firms were able to come in and buy distressed mortgages from the IBRC. They pocketed the write-down by getting the loan on the cheap, while the mortgage holder still has the full debt. It beggars belief.
We also know that when citizens try to engage with these unregulated vulture funds, they are dealing with an opaque system. There are mortgage holders who received letters from a company called Acenden in Sweden about particular mortgages. When they went back to the company, they found they were dealing with some other company which knew nothing about the parent company and operated through a PO box number. When they wrote to the other company associated with Acenden, which is Mars Capital - probably well named, if we are to be honest - it took a long time to obtain the information. There are no telephone numbers for these companies. Individuals receive statements with no opening balances, just the details of the year involved. If they look for other information on their 2014 statements halfway through 2015, that detail cannot be provided. They make payments to central accounts that have no reference codes and they cannot obtain a digital receipt or information from the firm involved.
We have a Wild West-type system of deregulation for a significant cohort of individuals. In the main, their situation is the result of a Government decision. We hoped the Government's response to this crisis would be to fulfil and safeguard the rights of citizens as much as possible. I cannot understand why it has not been achieved in this instance. In overall terms, the Government has fallen short on supporting families in mortgage distress. Although the Minister of State will say differently, the banks still have a veto. They still do not have to deal comprehensively with the range of options which should be available to those in mortgage distress, such as split mortgages, mortgage to rent, and restructuring of debt. None of that is being actively pursued by most banks, as they are just sitting back and not really doing much. We have recently found out that some banks were even in breach of the code of conduct for mortgage arrears. It shows that even the weak protections which are in place are not respected by the banks.
The Minister of State will recognise the text of the amendment because it is taken from the original document. It seeks to regulate all players operating in the mortgage system. There should be no separation or difference between owners and service providers. It should also include those who own the credit. It is a legally complex issue, but the first objective of any Government should be to ensure that the people concerned are fully protected. I appeal to the Minister of State to return to the track he was on initially to ensure full protection for all mortgage holders.