THE NUMBER of home owners who lost out on endowment mortgages due to alleged negligent misrepresentation by finance houses may run to hundreds, a solicitor has claimed.
Bryan Fox, solicitor for more than 70 clients who bought endowment mortgages from various banks, said there were possibly hundreds more who may be unaware they still could claim compensation through the courts.
He said that while many may be statute-barred from taking claims, anyone who had within the last six years become aware of financial losses could still have a claim.
He said the hard sell by banks of endowment mortgages and negligent misrepresentation of them to bank customers first came to light in an RTÉ expose by George Lee.
Mr Fox was speaking outside the Circuit Civil Court yesterday where he was representing pensioners Louis and Margaret Kilmartin, Strand Road, Portmarnock, Co Dublin.
They are pursuing a claim against the Bank of Ireland in the court.
David Hardiman, for the Kilmartins, has told Circuit Court president Mr Justice Matthew Deery that his clients incurred loss as a result of negligent advice by their bank manager of the superior security and return of endowment mortgages linked to an insurance policy over ordinary repayment ones.
The case, expected to last a week, is the first of numerous cases listed to come before the court in which the claimants allege the bank failed to warn them of risk attached to endowment mortgages which were linked to the stock market.
The court has heard from financial experts, including Eddie Hobbs, that in the early 1990s, the traditional role of bank branch managers had changed to that of financial product-pushers for hefty commissions.
Mr Hardiman, who appears with David Richardson, said the Kilmartins had bought their home in 1991 with a 15-year term endowment mortgage, and were claiming for losses which actuary Nigel Tennant yesterday estimated at just over €26,000.
Mr Hobbs yesterday told the court that through their endowment mortgage, the Kilmartins had effectively borrowed money at a rate of 11.85 per cent, with a return, not counting the value of life cover, of just under 3 per cent.
The court has been told that instead of receiving what they claim was a promised nest egg of €14,000, Mr Kilmartin had to pay off a shortfall of €4,864 out of his pension when the mortgage policy matured in 2006.
Further losses are estimated on additional premiums and interest the couple had to pay.
Barrister Alex Owens, who appeared with Paul McGarry for Bank of Ireland, which has denied negligence, told the court the endowment mortgage sold to the Kilmartins had proved €5,000 cheaper than an annuity mortgage.