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MBNA hit with fine of €750,000

THE Central Bank has fined credit card company MBNA Europe €750,000 and reprimanded it.

In 2009, MBNA had to refund around 370,000 of its customers after mistakenly overcharging them by almost €17m.

The company made a mistake in the way the charging of interest was described to customers in its credit card terms and conditions.

This meant it applied interest to some accounts where its own terms and conditions prevented it from doing so.

The Central Bank said that MBNA Europe had failed to "act with due skill, care and diligence" in the interests of customers.

It added that it had failed to put enough resources, checks and controls into making sure it complied with the consumer code.

The bank said MBNA had reported the problem, co-operated in settling the issue and refunded the affected customers with interest.

The company said it had spotted the overcharging issue and immediately brought it to the attention of the Central Bank and started to refund the customers right away.

Director of enforcement at the Central Bank Peter Oakes said stamping out overcharging was now a priority.

"We will take enforcement action against regulated entities which fall short of the required standards and their customers' legitimate expectations."

Almost 25,000 credit card customers of Ulster Bank are due to be refunded after it emerged this week that they had the wrong interest applied to their accounts.