Financial ombudsman seeks wider powers

The Financial Services Ombudsman, Joe Meade, has asked Minister for Finance Brian Cowen to consider changing the legislation that governs his office to give him wider powers.

Mr Meade said yesterday that he had decided not to appeal the High Court judgment that he could not order insurance company Quinn Direct to refund all customers who were charged a €25 administration fee when they changed their car but were not told that such a fee existed on their policy document.

Quinn Direct refunded the charge to a customer after he complained to the ombudsman's office, but the insurer successfully challenged Mr Meade's powers to order it to refund all similarly affected customers.

The ombudsman is to pay the legal costs of the successful challenge by Quinn Direct to his decision. Paul Anthony McDermott, for Mr Meade, told Ms Justice Mary Finlay Geoghegan yesterday that the ombudsman accepted he could not resist the application for costs by Quinn Direct given the judge's decision earlier this month to uphold the company's challenge.

The ombudsman has now asked Mr Cowen to consider clarifying part of the 2004 Central Bank and Financial Services Authority of Ireland Act to give him wider powers in such cases.

Otherwise, each customer affected by an inappropriate or unfair financial practice must lodge an individual complaint with the ombudsman's office.

Mr Meade's caseload has already increased by about 25 per cent this year.

The ombudsman said he would consider the implications of the High Court's interpretation of the legislation for a separate direction made by him in relation to Ulster Bank. In that instance, Mr Meade directed Ulster Bank to compensate about 500 investors in a particular fund a total of €7.4 million, after he upheld eight complaints in relation to a reduction in the fund's value.

The Consumers' Association of Ireland has urged affected Quinn Direct customers to submit complaints to the ombudsman.