Are Irish business so brazen that “naming and shaming” doesn’t matter any more?

Way back in 2004, Senator Donie Cassidy tried to start a “name and shame” campaign in the early days of what became known as “rip off Ireland”. If you were ripped off, you only had to name them to Donie, and he’d use Seanad privilege to shame them in the Seanad.

That went nowhere.

Since 2004, I’ve been keeping track of the Irish companies who’ve ripped off their customers by overcharging them in many various and ingenious ways. Last week, I wrote about AIB admitting for the eighth time that they’d stolen money from their customers in the past 6 years.

That’s them admitting to having unjustly taken nearly €34m from over 250,000 of their customers – an average of about €137.50 each. Handy money if you can get it (or more importantly if you’re bank is AIB, actually keep it).

It’d make you wonder:

1. What might be going on that we should know about but still isn’t being admitted to?

2. Why does AIB still 4m customers when so many of them are being treated this badly?

I’m focusing more on point number 2 here, and I’m a little perplexed.

I’ve been a persistent critic of the Financial Services Ombudsman who has steadfastly refused to “name and shame” financial institutions against which he makes findings.

My hope has always been that by naming and shaming, consumers would know who the transgressors are, and can then make conscious decisions to take their business elsewhere. So, if you know that financial institution x has been found to have misold a financial product to an unsuitable client, you can make your own decision to avoid that institution if you’re looking to do a similar kind of business.

But AIB has been named and shamed 8 times in 6 years for stealing money from their customers accounts (not to mention the balls they’ve made of their involvement in the property market in Ireland), but they still have 4m customers.

How can that be? Do people never learn?

Which brings me to this, from the Guardian:

There’s no point naming and shaming the banks. They have no shame

In an article from Patrick Collinson back in September, he leads with “Naming and shaming bad banks will never work. What we need is tougher regulation”.

When it comes to dealing with AIB for example, it seems we can have all the naming and shaming in the public domain that we could care to see, yet consumers aren’t learning their lessons – they’re remaining customers of the bank.

Who’s fault is it then, further down the road, if AIB dips back into their customers savings or current account for a few more quid? It’s not like they don’t need the extra cash at the moment.

Yes, obviously it’s the banks fault, but how much is the customer to blame, given they have full knowledge that having done this in the past, it’s possible that they may do it again.

Where does the Financial Regulator fit in here though? They can inform consumers – but consumers are informed now, but just not listening.

All that’s left, it seems, for Ireland as well as suggested by Mr. Collinson for the UK, “The alternative, which the financial services industry has fought tooth and nail against for years, is direct product and price regulation.”

So, more regulation. As Mr. Collinson closes, “The banks can’t be shamed into action. Instead they will have to be kicked”.

Unfortunately, as we’re seeing here in Ireland at the moment, our financial regulation has been named and shamed in its own right for recent disastrous activities, so we probably can rule out any new protections for consumers when it comes to overcharging in the near future.

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4 Responses to Are Irish business so brazen that “naming and shaming” doesn’t matter any more?

  1. Rory March 6, 2010 at 12:26 #

    Give me an alternative – I want to change banks? I want to do this to protest. If enough people did this then the robber banks would take notice and start to look after customers. Who do I go to?

  2. valueireland March 7, 2010 at 23:05 #

    Hi Rory,
    I guess your options depends on who you’re with at the moment, and whether or not there’s branches close to you or whether you’re happy to do your banking online.

    I’ll fully acknowledge, and will be returning to this in a future post, that the choice in banking is declining day by day in Ireland, thereby making your wish to switch much harder.

    The point I guess I’m trying to make is that very few people switch at all – and banks know this. Even if you were to go from AIB to NIB for example, you’re making your stance.

    If enough people did this, AIB would eventually have to take notice. Unfortunately, even when we had a lot more competition in the Irish market, people didn’t switch. You can understand why the banks are as smug and complacent as they are.

    Diarmuid

  3. Alex March 17, 2010 at 23:30 #

    I have tried to renew a €25,000 loan which is just about paid in full. I have been reliably informed by my bank I can no longer get anymore loans. They will not give me a good reason for refusing me the loan. I have the top credit rating and some savings of which I cannot touch as it is for my childrens college fees. The banks are not playing fair and need a shove in the right direction.
    I would also like to comment on Irish retailers. I am a retailer in Ireland and constantly find myself fighting with my suppliers to get better prices for my goods so I can give my customer better value. Thankfully I appear to be getting somewhere these days and now feel I can offer better overall value than can be had in any of the larger multiples. Irish suppliers are no longer in the business of bending to the likes of Tesco, Dunnes or Superquinn. They are now focusing their efforts on the small independent retailer. Their latest research shows the small independent retailer will be the future growth of their business and the survival of the economy. This will mean better value for every consumer on your doorstep. The money saved on petrol/diesel and on wear and tear on your vehicle will be more than compensated by the lower prices in your local store.

  4. millermit May 8, 2010 at 01:29 #

    Just an observation with regards to the banking debacle: When I came over to Ireland my employer “organised” a bus trip to AIB to open accounts for all the new fellas. I think I managed to stay with them for just over a year before I left in a fit of absolute fury. They are firstly rude, secondly incompetent, thirdly there never fails to be a queue, the pens are always broken at the counters, and I just found them a snotty, condescending bunch of twits in general. Not meaning to sound superior in any way, but back home they wouldn’t have been able to stop the revolving doors with the flood of customers leaving. Frankly, they deserve to go out of business.

    I changed to Bank of Ireland, to find that they were marginally better, though still completely bureaucratic and illogical, and what really sent me out the door was when I found out they were blatantly crooking me. It cost me €40 to close my account!

    I changed to Permanent TSB, and boy, what a difference! They actually phoned me overseas to ask if they could transfer money from my deposit account to my current account to cover my mortgage (rather than just assuming I’d want an overdraft, or worse) Respect.
    That’s customer service.
    When I walk into the bank there’s always a smiling face behind one of the customer service desks to help me fill out forms and all that jazz. That’s the thing, to me anyway. I’m not a high-roller, and I have utterly no interest in banking or bureaucracy, and have no desire to learn how to fill in form DD 2102357.3245 Pt.2 Subsection A.

    So, in a nutshell, I’m very happy with TSB (and no, I’m not getting paid for this) (oh, and I’m not from England)

    I’m surprised at how folks here tolerate poor service, whether it’s some misguided loyalty to an Irish brand, or whether they stay with these banks because their parents did, or possibly fear of change and the unknown, but the power is in the feet, I’m afraid. If you know they’re skimming or stealing, or whatever, pack your bags and walk away! For a bank to have to acknowledge EIGHT times that they were crooked, and STILL having people stay with them. Well, you can’t blame the banks for their customers stupidity, can you?

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