The Financial Regulator has told banks and insurance companies they should disclose overcharging incidents rather than wait for the media to find out about them.
Proactively bringing issues to the attention of the media can prove beneficial in the long-term for institutions, rather than waiting for them to come into the public domain, the regulator says in a letter sent to the institutions.
Its advice follows an investigation of the way banks and insurers manage and correction charging errors, and how they inform the regulator and customers of such incidents. Recent years have seen a number of major overcharging incidents in which banks were forced to repay sums of money to thousands of customers.
The investigation found that institutions are generally adhering to the regulator's consumer protection code and its requirement for them to correct errors speedily, efficiently and fairly. They have procedures in place but generally deal with charging errors on a case-by-case basis.
The regulator has advised each institution to maintain a central log of all errors to ensure that systemic faults are recognised. These error logs will be subject to inspection by the regulator.
It has also asked banks and insurers to correct inaccurate information about charging errors in the public domain quickly. Information for the media may vary depending on the case but should include the total sum involved and the number of customers affected.
Institutions have also been told to inform the authorities before they make public statements which refer to the regulator.