Latviski English По-русски
Tuesday 20.02.2018 | Name days: Smuidra, Vitauts, Smuidris

Consumer Rights Protection Centre: mortgage lending needs a new law

(+1 rating, 1 votes)

Baltic news, News from Latvia, BNN-NEWS.COM, BNN-NEWS.RU, Consumer Rights Protection Centre director Baiba Vitolina

Consumer Rights Protection Centre director Baiba Vitolina

Unfortunately, no one is taking the initiative to develop «Mortgage Lending Act», thus matters are sold in an fragmented manner and directed to the sector of the consumer protection, which in turn cannot be arranged without this law, Consumer Rights Protection Centre (CRPC) director Baiba Vitolina told in an interview to the business news portal BNN.

Similarly, she also singles out silly excuses the Center encountered upon inspecting ski runs and stresses Latvia finally has to specify what matters the Court of Arbitration decides upon and who supervises it. She also adds the CRPC in Latvia has more authority than the respective institutions in Lithuania and Estonia.

You inspected 24 out of 30 ski runs in Latvia. What did you discover?

According to the law, we are to supervise 16 types of dangerous equipment. This year we opted for ski runs and one more. We will round the inspection up in eight years, as the Center lacks funds, which, to my mind, are not adequate. We are still to assess the infringements we discovered, namely, ski lifts maintenance was not sufficient. There will definitely be some kind of punishments, they are not imposed on the spot. There is a special procedure carried out by the administrative offences officer. Businessmen do not offer any reasonable excuses. They say no one is checking that, the CRPC is the first… Others simply show their ignorance, while some admit their neigbour made the ski lift himself.

Why do you think licensing non-bank lenders is not to solve the problem?

Lisensing cannot solve everything, it is supervision that matters the most. The good thing is we get an additional tool to fight unfair businessmen, as it will be possible to deprive their licenses. From consumers perspective, licensing is not a big deal. Moreover, it is not enough to licence creditors, because it is exactly loan mediators creating the negative image and they are not licensed at all. They are fraudsters promising to arrange bank loans, thus they collect considerable payments from desperate people. There are also clients that banks refuse to service, despite the mediator had pledged something else.

Some of these loan mediators are recklessly concluding such contracts despite there is no agreement from the part of the creditor. Moreover, they claim advance payment for their services. While some of them mislead people into believing that otherwise they will not be qualified to be granted a loan, although in reality the person would have obtained a loan either way. Consequently, people spend additional money on these mediators. When Great Britain licensed consumer crediting, many turned into mediators or consultants. It will turn out to be easier for the existing commercial banks, because we will supervise them less.

Latvia finally has to specify what matters the Court of Arbitration decides on and who supervises it.

How is it possible to protect loan takers without the «Mortgage Lending Act»?

I believe we need this law. Unfortunately, no one is taking the initiative to develop «Mortgage Lending Act», thus matters are sold in an fragmented manner and directed to the sector of the consumer protection, which in turn cannot be arranged without this law.

This way both consumers and businessmen would be aware of the rules – how properties are confiscated and whether they can be deprived of their homes. Back in the fat years people did not even know what they were signing up for. The state should not allow this free drift mode.

We must bear in mind that each regulation is able to alter interest rates in the loan market. We should learn from US practice with an insolvent mortgage taker simply giving back the key and no one is pursuing him or her anymore. It is a politically sensitive issue. Such an agreement would cost more and there would be no loans covering 100% of the property value.

How do you fight excessive penalty interest payments?

We do have the power to limit these penalty interest rates thanks to Consumer Rights Protection legislation. I must say the so called fast SMS credits are applied the highest interest, not mortgage loans.

Last year you punished several recruitment companies promising work abroad. What did they do wrong?

The State Employment Agency informed us about recruiters without a respective license. They were punished for not presenting the number of the license in commercials. If they had charged people without sending them to foreign factories, it would have been considered a criminal offence, rather than a breach of consumer rights. In 2005 three mutual Baltic states agreements were signed on consumers rights protection and market supervision.

What is the performance of Latvian CRPC, compared to Lithuania and Estonia?

The most recent cases with Latvia CRPC collaborating with the neighbours include VIASAT, IMP Baltic, airBaltic, ect. We also collaborated with Estonians when airBaltic activities contradicted good faith in business, namely, the airline was selling tickets very well aware it was going to cancel these flights. Estonians took day-offs, booked hotels, but there were no flights.

The CRPC can only order doing away with the infringement, it cannot impose any sanctions on the company’s activities in Estonia. In case of Latvia all these functions are concentrated within the CRPC, thus we can easily access detailed information. It is easier to work for us, because we have greater authority than the respective institutions in Estonia and Lithuania. We do not have to apply to the court to deem something as lacking legal force or unfair. Similarly, we ourselves make decisions on sanctions, however there are pros and cons of that.

Is it possible to reach a balance between consumers attraction through commercials etc. and their rights protection?

I believe a balance is possible if there are companies willing to operate long and fair in the domestic market. If they want to stick to their positive image, they agree to what the CRPC decides, unlike what happened five years ago. Businessmen are perfectly well aware negotiations can lead to a commercial practice satisfying both of the parties, including consumers. It is much more difficult to arrange the market if there is aggressive competition among the companies, like it is for mobile operators. The competition is so fierce if one of them opts for unfair practice – deliberate misinformation of consumers – the other has to respond in the same way. It is important to create a new dispute resolution commission at the CRPC with the Chairman of it, consumers non-governmental organizations, our employees and businessmen themselves making decisions.

Are your budget and staff sufficient to carry out these functions?

No, they are not, the budget has been cut significantly and it is complicated to implement all the functions the state has entrusted to the Center. There are certain fields we cannot manage at all. These cuts made us come to a conclusion we would no longer supervise electronic communications terminal equipment in the competence of the Transport Minister. Neither do we keep supervising fridges energy efficiency, which would claim huge funds.

Is it possible to solve and argument between a consumer and an insolvent businessman?

It is not, if the company is left with nothing at all. If there is still something the company can sell, one can turn to the administrator with a claim. Stock capital does not matter that much. We believe it is too easy in Latvia for an unfair plastic windows producer to launch another company under another name and keep misleading consumers, despite having already deceived 100 consumers that had paid 200 lats for these windows but never saw them. There are no ways we can ban them from doing business.



Leave a reply

  1. Joeie says:

    f2E1kw Kewl you should come up with that. Ecxeelnlt!

    Thumb up 0 Thumb down 0

  2. zoveerropsy says:

    Кучу перепробовала ни одна не работает
    Народ посоветуйте хорошую диету так чтоб особо не напрягаться но и чтоб интересно было?

    Thumb up 0 Thumb down 0

  3. Viagra Glasgow, want to buy Viagra online says:

    I want to share it on my Facebok wall
    You can find me there as Bark Pacober

    Thumb up 0 Thumb down 0

  4. HarfMooda says:

    cialis levitra levitra tramadol. Post by hieneoure on Wed Jan, am. Excuse me for choosing cheap wow gold to leave a message for you.

    Thumb up 0 Thumb down 0

Public opinion: KGB documents should be made publicly accessible immediately

Latvia’s society believes the KGB documents should be made publicly accessible immediately. In addition, residents say they are confident in their ability to discuss those documents without the country’s supervision, which takes the form of expert opinions prevailing over society’s moral views, as stated by guest researcher of History Institute of the University of Latvia M. His. Marta Starostina.

For Latvia’s Development: the prime minister is gone, but finance minister claims otherwise

«What we have observed in the past several days is that Latvia’s financial sector has received several heavy strikes as a result of the government’s uncoordinated and chaotic actions. Prime Minister Māris Kučinskis has evidently ‘disappeared’ and offers no clear plans to resolve the crisis, whereas Finance Minister Dana Reizniece-Ozola says different things in every interview. Such behaviour will not help resolve the crisis. It could instead pull the country’s financial sector in a much deeper crisis,» says chairman of For Latvia’s Development Juris Pūce.

Bank of Latvia provided ABLV Bank with a loan of 97.5 mln euros in exchange for securities pledge

The Bank of Latvia has provided ABLV Bank with a loan worth EUR 97.5 million in exchange for securities pledge, as confirmed by the financial institution.

Prime Minister: Bank of Latvia governor is not allowed to take official post

As a security measure, the governor of the Bank of Latvia Ilmārs Rimšēvičs has been applied with a prohibition to take post, said Latvian Prime Minister Māris Kučinskis after a meeting of the Cabinet of Ministers.

Poland's halt to logging in ancient forest came after irreparable damage

Although Poland has stated logging in the old-growth Bialowieza forest has been stopped, Warsaw has failed to reveal the amount of trees already cut down.

«A good friend» pays 100,000 euro bail for arrested governor of the Bank of Latvia

Corruption Prevention and Combating Bureau (CPCB) has applied a bail of 100,000 euros for the arrested governor of the Bank of Latvia Ilmārs Rimšēvičs. The bail has already been paid to the State Treasury account, as confirmed by his lawyer Saulvedis Vārpiņš.

NP: ABLV blames Latvian officials for misleading foreign institutions

Last week, the reputation of Latvia’s second largest bank – ABLV – was seriously impacted. It is believed that money laundering was this bank’s main operation, and that it failed to comply with the prohibition on cooperation with North Korea. The bank is also accused of bribery. US Department of the Treasury Financial Crimes Enforcement Network rarely speaks so directly of any credit institution, says Nekā personīga programme.

Changes to third-country student residence in Estonia to add more responsibilities to university staff

The Estonian government has backed planned amendments are to the Aliens Law implementing an EU directive into Estonian law, which change how third-country nationals on enter and reside in Estonia if they are study or performing research work.

Russia criticises U.S. charges of Russian meddling in U.S. election

The Foreign Minister of Russia, Sergei Lavrov, has criticised the charges announced by the U.S. Federal Bureau of Investigation, against 13 Russian nationals and three companies for election meddling.

Government plans to form four riot prevention units in Latvian regions

The State Police plans to form four riot prevention units in Latvia’s regions, says Chief of State Police Ints Ķuzis.

Syrian Kurdish fighters under attack by Turkey announce deal with Syrian government forces

The mainly Kurdish militia in the north-west of Syria have announced having reached an agreement with the Syrian government for the latter to deploy its soldiers in order to help Kurds repel the current Turkish attack.

NCP: it is highly important to replace management of Bank of Latvia and FCMC

Considering recent events, which have not only impacted the country’s finance sector but also its international reputation, the New Conservative Party (NCP) demands immediate measures to be undertaken to replace the management of the Bank of Latvia and the Finance and Capital Market Commission. On top of that, it is also necessary to perform radical changes in the organization and supervision of those institutions, says NCP chairman Jānis Bordāns.

Air temperature in Latvia to gradually decline this week

On Monday, 19 February, atmospheric pressure will increase slightly in the north. With that, it is expected to snow only around Kurzeme’s south-west. Air temperature in most of Latvia will stay at -1° C… -6° C. In Kurzeme, however, air temperature will be around 0° C… +1° C, as reported by State Environment, Geology and Meteorology Centre.

Week in Lithuania. Lithuania celebrating centennial of statehood

Leaders of European countries gathered in Vilnius on Friday, February 16, to celebrate the 100-year anniversary of restored statehood, and festive events were taking place in many cities and towns of Lithuania.

BNN summary of the week: minister threatened with dismissal; ABLV Bank scandal

BNN offers a summary of this week’s topical news in a variety of categories: Change; Fight; Court; Problem; Decline; Commentary; Future; Proposal

SRS uncovered violations in 169 inspections at catering companies last year

In 2017, the State Revenue Service (SRS) performed a total of 989 inspections at 212 catering companies. This includes 182 thematic inspections for 125 taxpayers. Violations were uncovered in 169 inspections. The most common violation was manipulation with cash registers, according to information published by SRS.

Russian tourists often decide to celebrate International Women’s Day in Riga

To satisfy growing demand for bus tickets from Russia to Latvia for the week when 8 March is celebrated, Lux Express plans to organize additional buses between St Petersburg and Riga.

FCMC to investigate ABLV Bank again; no operational restrictions applied to the bank

Latvia’s Finance and Capital Market Commission (FCMC) has plans to perform an additional investigation at ABLV Bank in the next couple of weeks, says the commission’s manager Pēters Putniņš, adding that no operational restrictions have been applied to the bank so far.

Study: overall sense of happiness in Latvia is record-low

60% of Latvian residents feel happy. Although this is a good index, there has been a general decline of the sense of happiness, according to a study performed by Amigo mobile network operator and SKDS to assess the level of happiness of Latvian residents.

Raid reveals some taxi drivers in Riga do not have valid driver’s license

A raid was performed by the State Revenue Service and Riga Municipal Police to check taxi service providers in the capital. Authorities uncovered a total of 81 violations in 48 cases, BNN was informed by SRS.

Estonia sea ice crash: last missing body found

Nine days after a van with six people inside drove onto the ice of the Baltic Sea in south-western Estonia, the body of the last victim has been found.

Delna invites immediate investigation of claims about ABLV Bank’s money laundering schemes

The decision by US Finance Ministry’s Financial Crimes Enforcement Network (FinCEN) to apply sanctions against ABLV Bank for involvement in money laundering schemes and bribery of officials was not a surprise. It is a sign for acute need to continue improving investigative and supervisory institutions’ ability to prevent money laundering through Latvia, as noted by Delna – Society for Openness.

Estonian income tax should be simplified, parties believe

The existing income tax scheme in Estonia should be simplified, three parties in the Estonian Riigikogu find, but there are differences in opinion as to maintaining the current state budget income. Meanwhile, the opposition Reform Party has voiced backing for an annual tax-free income of 6,000 a year to every earner.

Baltics propose increasing member states’ contributions to EU budget after Brexit

Latvia, Lithuania and Estonia invite European Union member states to increase contributions to the EU budget after 2020 in order to make sure available funds do not drop after UK’s exit.

Instagram obeys Russian internet censor to block content on corruption allegations

In the atmosphere of the March Russian presidential election, social network Instagram has submitted to the demands of Russia's internet censorship body and blocked in the country content with corruption claims voiced by Russian opposition figure Alexei Navalny.

Most read

Most commented