2011-10-19 Consumer Protection Code 2012

This revised Consumer Protection Code (2012 Code) will come into effect from 1 January 2012. As with the predecessor version it relates to banks, insurance and investment companies (other than MiFID firms) and intermediaries. The Central Bank understands that the changes in the new Code will require certain changes to systems and prociedures and has singalled that they "will be cognisant of this for the first six months of our monitoring of compliance with the 2012 Code.”

 Arrears handling:

• The 2012 Code introduces protections for consumer loans similar to those for mortgage arrears which are already covered by the Code of Conduct on Mortgage Arrears.

Contact with consumers:

• Unsolicited personal or “doorstep” visits are to be banned.
• There are also stricter rules in place to regulate the circumstances in which personal visits can take place.
• In addition, in the case of arrears, the 2012 Code limits the number of unsolicited communications with a consumer in arrears to three in each calendar month.

Mis-selling of products 

• The information requirements to complete the ‘Knowing the Consumer’ process have been considerably tightened
• Staff remuneration arrangements must not impair assessment of suitability and appropriateness
• Product producers to give detailed information and sales targets to intermediaries in relation to the investment products they sell on behalf of the product producers.

Vulnerable consumers:
In line with considerable previous commentary by the Financial Services Ombudsman, provisions have been introduced for dealing with vulnerable consumers.

Mortgage lending:
In order to promote more responsible mortgage lending, the acceptance of self-certified declarations of income by regulated entities has been banned and there are stricter requirements in place for affordability testing.

Transparency:
More balanced information must be provided to consumers in advertisements. Key information on products and services must be made prominent in advertisements and must not be obscured. The 2012 Code also has considerable specific detail regarding the key information that regulated entities must provide to consumers including information on charges, commission and remuneration arrangements as well as information about the product or service.

Errors and complaints resolution:

• There are now limited timeframes for firms to resolve errors.
• Detailed records of complaints from consumers and errors affecting consumers must also be maintained.
• Regular analysis of errors and complaints is required to ensure.

Download the 2012 Consumer Protection Code