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AIB pays €3.7m to customers after overcharging error

NewsBy Shuki Byrne
AIB has been forced to pay back customers approximately €3.7 million
AIB has been forced to pay back customers approximately €3.7 million

AIB has been forced to pay back customers approximately €3.7 million after it overcharged nearly 7,000 clients.

The affected clients were not informed by the bank that overdrafts had expired. As a result, they each incurred surcharges by the bank in error. 

AIB reported the issue to the Central Bank, and have since informed its clients who are mostly business customers. 

Business customers thought they had overdraft facilities in place. But the bank did not recognise this and the customers ended up being charged surcharge interest and penalty fees for having an “unauthorised” overdraft.

The average refund was around €543, the bank said. 

AIB released a statement apologising to the customers affected. 

“Following a recent review by AIB of its overdraft product, it was highlighted that a number of issues may have resulted in an unintended error in the amount of surcharge interest and/or fees being charged to the accounts.

“The bank is making refund payments relating to approximately 6,855 impacted customer accounts in relation to this matter. The average refund is approximately €543 including compensatory interest.

“AIB sincerely apologises for this error and any inconvenience caused as a result. The appropriate changes to procedures have been implemented.”

It's the latest in a series of errors made by the bank. 

In August, it emerged approximately 110,000 customers may be entitled to a refund following a review by the bank of their card protection policies.

According to AIB, the customers in question may not have been given enough information when they bought the product - they were paying for cover for fraudulent or unauthorised use of the card that the bank was already paying.

Card protection is an optional policy - it has a premium of €16 a year.

The scheme was provided by Pinnacle Insurance and customers may have selected it when they were applying for an AIB credit card.

AIB said it is working with the Central Bank to established a voluntary redress scheme for those who bought the policy from August 1 2006.

According to the Central Bank, consumers who believe they are affected and do not receive a letter from AIB by 30 September, should contact it directly.