Consumer Protection Code
A general Consumer Protection Code for financial institutions, including banks, was introduced by the Financial Regulator in August 2006 and became fully effective from July 2006.
The full detailed code (August 2006) and some supporting documentation and clarification is available on www.nca.ie by using the search facility. A concise version of this can be downloaded below:
Many of the previous voluntary industry codes are superseded by this code, but a significant area which is not addressed is the area of account switching. Accordingly, we must assume that the older (2005) industry code still stands.
Among the key areas addressed are:-
Fees and charges – The details in the code are now further strengthened in new legislation included in the Financial Services Regulations (Oct 2009) which are available here. Both lay down requirements for disclosure of fees and charges.
- In advertising
- At the time of account opening
- When fees are changed
- When fees are applied
Knowing the customer – Banks are required to seek appropriate levels of information about the customer in relation to the product or service supplied. Personal experience of opening an account recently indicates that the level of information requested appears to be excessive.
Suitability – Banks are required to ensure that products sold are suitable for the particular circumstances of the customer. The Financial Regulator has stated that there will be certain exceptions, particularly over-the-counter services Some of the principal rules include:-
- Misleading terms must not be used to describe products.
- “Tying” practices are prohibited. Tying is a practice of making the purchase of a product contingent on purchasing another product.
- Customers must be provided with documentation regarding terms of business when opening an account.
- Complaints procedures are required in every bank
- Customers must be advised when phone calls are recorded
- Where banks use electronic communications with consumers these must be secure.
- Unsolicited contact with customers is restricted.
- Full transparency is required in relation to all fees and charges
- Detailed rules are included in the Code regarding advertisements