Senator raises vulture fund abuses at Oireachtas Finance Committee

A local Fine Gael Senator raised concerns during a meeting of the Oireachtas Committee on Finance, Public Expenditure, Public Service Reform and Digitilisatio last week.

Joe O'Reilly discussed the lack of safeguards to protect consumers from the discriminatory actions of so-called vulture funds, when speaking on Wednesday, 18 February.

Addressing David Hall, co-founder of the Irish Mortgage Holders Organisation (IMHO), Senator O’Reilly thanked him for his “wonderful work” in assisting people across Ireland to resolve debt issues with lenders and creditors. He said many citizens share deep concerns about the limited regulation of vulture funds and pointed to what he termed a “lacuna” that “needs addressing” in the processing of cases by the Financial Services and Pensions Ombudsman (FSPO).

According to Senator O’Reilly, the growth in the number of vulture funds operating in the Irish market has had a knock-on effect on organisations such as Money Advice and Budgeting Service (MABS), which he suggested have been “quelled” in their ability to effectively assist those impacted.

Throughout his contribution, Senator O’Reilly criticised what he sees as insufficient intervention from the Central Bank of Ireland. He highlighted the serious challenges faced by individuals and families seeking adequate remedies and support, arguing that the “court process is too expensive” for consumers. He warned that the situation can be particularly distressing for both younger and older borrowers, especially those dealing with “interest only loans”, which he said can cause “shocking trauma”.

To illustrate the severity of the issue, Senator O’Reilly referenced an individual case involving a two-year process in which three separate financial institutions were found to have breached the Code of Conduct on Mortgage Arrears. Despite the borrower meeting all legal requirements to repay the mortgage, the loan was subsequently sold on “without permission”.

In concluding his remarks, Senator O’Reilly called for consideration of a “dedicated” court to deal specifically with debt cases, suggesting such a measure could provide more effective and accessible support to affected individuals nationwide.