#RFdlaUkrainy: The Financial Ombudsman’s website in Ukrainian
30 May 2022
The Financial Ombudsman, as part of its activities under the #RFdlaUkrainy slogan, has launched a Ukrainian language version of its own website www.rf.gov.pl/ua. It contains basic information about the activities of the Office of the Financial Ombudsman, as well as advice and warnings for visitors from Ukraine. Email counselling in Ukrainian has also been operating for two months.
The Office of the Financial Ombudsman has launched a Ukrainian version of its website. This is another version of the Financial Ombudsman’s website, alongside the English and French versions. It contains compact information on the activities of the Office, the scope of its competence and the assistance it provides to clients of the banking, capital and insurance markets.
At the same time, on the newly launched websites, Ukrainian clients will find advice and warnings related to safe use of financial products and services available in Poland. Specialists from the Office of the Financial Ombudsman provide information about the rights and obligations of clients on the Polish market, as well as possible threats from fraudsters, such as phishing methods.
Earlier, in March this year, the Financial Ombudsman launched a special campaign under the #RFdlaUkrainy slogan, launching free email advice in Ukrainian (firstname.lastname@example.org). The clients can turn there for help and advice related to the use of financial and insurance products and services available on the Polish market.
Also in March, the Financial Ombudsman addressed banks, lending institutions, insurance companies and associations of such entities operating in Poland with demands for good practice in connection with the influx of refugees from Ukraine into our country. The Financial Ombudsman calls for refugees to be provided with at least basic and safe banking services, but also protection from illegal activities, including consumer protection.
However, in April this year, the Financial Ombudsman conducted a warning campaign in Ukrainian on social media, where it draws attention to possible risks when using online banking and good practices in dealing with financial institutions.
The Financial Ombudsman monitors the banking, capital and insurance markets on an ongoing basis for products and services offered to refugees from Ukraine. At the same time, the Financial Ombudsman’s experts are continuously preparing advice and warnings in Ukrainian related to potential risks for consumers and criminal activity.
#RFdlaUkrainy: Online safety. Beware of cybercriminals!
22 April 2022
In view of the ongoing war in Ukraine and in response to the need faced by Ukrainian citizens arriving in Poland in large numbers, many banks in Poland have prepared offers to open a bank account dedicated to our neighbours from the East. The Financial Ombudsman publishes a set of tips outlining the basic principles related to safe use of online banking and warns of the risk of money being stolen from a bank account and personal details being phished.
The Financial Ombudsman points out that criminals adapt to changing socio-economic realities and often take advantage of the difficult life situation or overconfidence of potential victims. The Financial Ombudsman expects that also in the current situation the actions of dishonest individuals and entities taking advantage of the difficult position of war victims and refugees will become visible. Cybercriminals can exploit the unawareness and anxiety of Ukrainian refugees in particular, therefore the Financial Ombudsman outlines basic principles and tips for safe online banking.
To protect yourself from fraud and be an informed payer, remember:
- Reliable information for refugees can be found on the pages in the gov.pl domain.
The pages available in the www.gov.pl domain belong to public institutions in Poland. In the era of seeking reliable information about the state of war in the East, aid for refugees in Poland and taking the right action, it is worth using official and verified sources. Do not act impulsively and take the time to verify the information, especially if it prompts you to take steps related to financial burdens.
- Protect your personal data!
By opening a bank account, you may be exposed to people whose aim is to phish for your personal information or steal your identity to commit crimes. Stolen personal information can be used to take out a loan on your behalf or open a bank account without your knowledge, where funds derived from crimes can be collected. To prevent this, when opening a bank account, do not accept assistance from unknown, random people. Information necessary for identification (name, surname, place of residence), as well as details of an identity document such as a passport, should be protected and only given if necessary! If your documents have been lost or stolen, report this immediately to the law enforcement authorities – the Police or the Public Prosecutor’s Office!
- Check with your bank what documents you will need to open an account.
Banks in Poland have responded to the difficult situation of Ukrainian citizens by simplifying the procedure for opening a bank account. Opening a bank account always requires a visit to a bank branch, but banks do not have the same requirements regarding the type of document that needs to be presented. Check whether you have the document required by the bank and whether the chosen bank also sets other conditions, such as having a telephone number or address of residence. Before visiting your bank, call the helpline for the most up-to-date information.
- What about an online banking application and payment card?
It is at the stage of entering into the agreement that the bank will inform you that you can use the banking application and give you instructions on how to install it. A payment card is usually provided as a consequence of entering into a bank account agreement. Look out for individual charges, for example for cash withdrawals from a particular ATM and transfers. The agreement and terms and conditions also include security rules regarding, among other things, the storage of the card or obligations to report card loss/theft. If you are not sufficiently familiar with the Polish language and the agreement is drawn up in Polish, ask a trusted person to translate it, particularly with regard to the obligations imposed and fees. However, if you ask for a translation, remember to protect your data, e.g. your unique login data to the application, as such data should be known only to you and you should never disclose it even to a trusted person!
- Pay attention to what type of payment card your bank offers you.
The most common payment card, used for example for shopping in brick and mortar shops or online, is a debit card. It allows you to use your own funds held in a bank account. It is to be distinguished from a credit card, where you use the bank’s funds, within a credit limit granted by the bank, which you must repay according to the terms of your agreement.
- Online security – unauthorised transactions. Do not install unknown applications.
The Financial Ombudsman points out that caution should be exercised, because every year there are many cases of so-called unauthorised transactions. How can an unauthorised transaction be described in a nutshell? This is a transaction that the bank customer did not consent to, but was nevertheless executed, e.g. as a result of criminal activity.
Criminals are increasingly using the ‘remote desktop’ method, in which they urge people to install applications such as Anydesk, Ammyy Admin, TeamViewer, Mikogo, ThinVNC, UltraVNC. If anyone urges you to install this type of application, you can assume it’s a scam. Such applications are used to take control of your device and bank account. Criminal activity in the area of unauthorised transactions can be expected to increase, and offers to install unknown applications may be forthcoming, if only in connection with a supposed desire to provide assistance, housing offers, etc. So be vigilant!
- Never give your e-banking passwords or payment card security details to anyone. This applies to contact in person, online and by telephone.
The bank never asks for your password, login or one-time codes in an email or over the phone, not in any emergency situation, let alone for a ‘threat’, ‘opportunity’, ‘reward’, etc. A recent popular scam is to impersonate a bank employee. Never provide login details outside of the bank’s website (which should be verified each time – see section 9).
- Learn about the most common methods of stealing money from your bank account.
Currently, one of the most common and difficult to detect crimes is the fraud initiated by olx, in which a third party claims to be the buyer/seller and sends a fake payment link via another application (e.g. WhatsApp). Other scams, such as ‘additional payment’ scams, which involve sending a fake link in an SMS or email, in connection with a supposed need to pay extra for gas, electricity, a package or other services, are also still popular. The link in this case is false and the content may also refer to another payment, offer. Do not click on such links, as this puts your computer or smartphone at risk of becoming infected.
- Always check that you are on the bank’s official website.
Check that the website has a “green padlock” (SSL) and at the same time the correct bank name in the website address. Simply checking for the presence of a padlock is one possible form of verification.
- Do not open emails, messages of unknown origin, especially attachments.
Acting according to the principle of ‘no trust’ or ‘limited trust’, verify information, spot inconsistencies, take a moment to check the credibility of a website, message or offer. This will prevent any attempt to phish for your identification or authorisation details or to induce you into financially disadvantageous actions. Remember that one popular method of stealing money from your account is phishing, which is most often based on sending out mass emails or via social media that contain links to phishing sites.
- Set transaction limits for logging into banking services.
Set limits on the amount of a single transaction and limits on the maximum number of daily transactions. The limit can be increased at any time (e.g. for one-off larger operations), and for a criminal a low limit can prove to be a real obstacle to stealing funds from your bank account. A limit does not protect against theft of funds from your account, but it can make it harder for an unauthorised person to operate freely on your account.
- Pay attention to whether the Bank offers you so-called ‘click loans’ in online banking.
A so-called ‘click loan’ is a type of quick loan which is often offered by Polish banks. It is granted in electronic banking, in a completely remote manner. Remember that if your bank account is hacked, criminals can not only deprive you of all the funds in your account, but also take out a loan on your behalf. At the stage of entering into the agreement, the Bank ‘collects’ marketing consent, including to display and offer a quick ‘click’ loan in the online banking panel. If you are not interested in this form of loan, e.g. for fear of an unauthorised person gaining access to your account, do not give such consent and this type of offer should not appear in the system.
- What to do if you are a victim of cybercrime?
If you have already been a victim of fraud, report it to the Police or the Public Prosecutor’s Office. At the same time, report the unauthorised transaction to your bank, and if you do not receive a reply or if it is negative, you can ask for help from the Financial Ombudsman or the municipal or district consumer ombudsman. Action should be taken immediately.
An illusory insurance contract to a loan. The court agreed with the Financial Ombudsman and ruled in favour of the borrower who was ill.
21 April 2022
The District Court in Konin, hearing the case of the borrower, who was supported by the Financial Ombudsman with an important view, dismissed the claim in respect of the entire insurance fee. The Court shared the Financial Ombudsman’s view on the illusory insurance cover of a bancassurance product, i.e. insurance taken out together with a loan agreement. The court found that there were abusive, i.e. prohibited, provisions in the agreement and eliminated the insurance contract from the loan agreement.
Mr Henryk (name changed), an inhabitant of the Wielkopolskie Voivodeship, in 2013 took out a consumer loan from Eurobank S.A. (now Millennium Bank S.A.) in the amount of PLN 104 thousand. To this amount, the bank added insurance (over PLN 25 thousand), which increased Mr. Henryk’s liability to nearly PLN 131 thousand. In 2016, as a result of having suffered a stroke, the borrower experienced paresis. He was unable to work professionally and was in a difficult life situation. As a result, he was unable to continue repaying the loan.
Mr Henryk was convinced that the illness he suffered was covered by insurance taken out with the bank in the event of his death or permanent total incapacity for work. However, the borrower’s illness was not considered a covered event, and the bank, after terminating the loan agreement, brought an action against the borrower for payment of the outstanding loan.
Mr Henryk asked the Financial Ombudsman to provide an important view on the case. After an in-depth analysis, the Financial Ombudsman presented the court with a document containing a number of theses and legal arguments. Firstly, the Ombudsman noted that the payment of the life insurance premium did not constitute the essentialia negotti of the loan agreement (its elementary part), which gives grounds for assessment under Article 3851 §1 of the Civil Code as a prohibited provision. According to the Ombudsman, the provisions concerning the insurance contract in the loan agreement were unclear and were drafted in an ambiguous manner. In one place the contract indicated that the insurance protected the risk of total and permanent incapacity for work, while in another place it indicated that disability. Nor did the wording of the contract contain definitions of these important terms.
The Financial Ombudsman also stressed that the conclusion of this type of insurance contract should be preceded not only by an examination of creditworthiness, but also by an analysis of the application for insurance cover. According to the Ombudsman, the abandonment of the medical interview and the examination of the risk declaration could be evidence of the forced rather than voluntary nature of the insurance, which was de facto intended to safeguard the bank’s interests. The Ombudsman also pointed out that the cost of the insurance is very high in relation to the total amount of the loan and the mechanism for its calculation was not clearly explained to the client. This determined Mr Henryk’s rights and obligations in a manner contrary to good practice, grossly infringing his interests.
The court examining the case shared the Financial Ombudsman’s view, considering the insurance to be illusory, and regarded the related provisions as abusive clauses. The court noted irregularities in the amount of the insurance fee, the forced nature of the insurance and the failure to pay the sum insured.
At the same time, the Court emphasised that such a large disproportion between the amount of the loan made available and the cost of insurance is a sign of a breach of the principles of loyalty and contractual balance. It also shared the Ombudsman’s view that the provision defining the risk was inconsistent in its wording.
The conclusions reached above caused the court, in determining the bank’s claim, to eliminate the insurance contract entirely from the loan agreement, specifying the debt and the amount due without the amount of the insurance fee, and therefore without approximately PLN 25 thousand.
The judgement is not final.
The case concerns an insurance contract that falls within the so-called bancassurance distribution channel. To illustrate, bancassurance should be understood as the conclusion by a bank of insurance contracts linked to a bank product where the bank customer, on the basis of a separate agreement, is obliged to cover the costs of the bank’s insurance cover against particular risks covered by such insurance contract.
The Financial Ombudsman, in the context of Mr Henryk’s case described above, reminds that in accordance with the Civil Code, parties entering into a contract may arrange the legal relationship as they see fit, as long as the content or purpose of the relationship does not contradict the characteristics (nature) of the relationship, the Act or the principles of social co-existence. In the context of an insurance contract, the insurance institution indirectly confirms the reliability of the customer concerned and assumes a certain degree of risk associated with the granting of a loan.
Thus, if the structure of loan insurance provisions does not ensure coverage of the bank’s losses in the event of the occurrence of strictly specified events included in the contract, as a result of which the bank’s receivables are not satisfied by the borrower whose debt is insured, or defines them in an ambiguous manner, it may mean that they contain abusive provisions, i.e. prohibited provisions, which by law are not binding on the consumer.
The Financial Ombudsman will examine ‘click loans’
20 April 2022
The Financial Ombudsman has requested banks to provide information related to so-called ‘click loans’. These are quick loans granted by banks, which customers can obtain through a bank transaction service without contacting a bank employee. Loans are granted automatically, and their limits are set by banks on the basis of their knowledge of their own customer’s financial situation. The Financial Ombudsman also wants to know how, and if at all, customers can relinquish the ‘click loan’ option in their existing range of available bank products.
The bank with which we have an account often assumes that it knows our financial situation well enough to grant us a loan of an individually specified value, without having to launch the creditworthiness checking procedure and other formalities. This is how a so-called ‘click loan’ was born, i.e. a quick loan that can be taken at a bank where we have an account and access to an online transaction service. To take advantage of such an offer, it usually only takes a few clicks on the bank’s website or mobile application – hence, the colloquial name for this type of loan products.
“Although this solution is beneficial both for banks – they save time of employees and costs of credit service, and for consumers – a loan can be taken quickly and without unnecessary procedures, a problem arises when an unauthorised person obtains access to our account,” explains Joanna Łagowska, PhD, Director of the Banking and Capital Market Customer Division at the Financial Ombudsman’s Office. “This usually happens as a result of the actions of criminals who use a wide range of social engineering methods for this purpose. If they get into our account, they can clean it out not only of current funds, but also, on our behalf, take out a loan and misappropriate its value. The defrauded customer is left not only destitute, but also with a credit obligation that may be repaid for years,” adds Joanna Łagowska.
Therefore, customers, fearing that fraudsters will incur liabilities, may wish to simply disconnect such a product from their bank’s offering. However, the Financial Ombudsman has received indications that this is not possible in every bank. That is why the Financial Ombudsman wants to check what procedures are in force in this respect in banks operating in Poland.
The Financial Ombudsman has already addressed the subject of ‘click loans’ several times on the occasion of so-called ‘unauthorised transactions’ in his statements, analyses, warnings and communications. This problem was highlighted by the Financial Ombudsman, for example, in its 2019 analysis (link).
Nevertheless, the Financial Ombudsman’s Office continues to record a growing number of customer requests related to the conclusion of loan agreements using electronic banking (or other payment instruments within the meaning of the Payment Services Act of 19 August 2011, such as mobile applications), referred to as ‘click’ loans or credits.
In the Ombudsman’s view, the related claims indicated in the requests should be classified as cases of particular hardship for customers. They may not only have a negative impact on the current financial situation of a given customer, but may also result in further repercussions, including financial exclusion (if the customer is unable to repay) or deterioration of the situation of potential heirs.
The action taken so far by the Ombudsman in these cases allows a general conclusion to be drawn that financial market operators, and above all banks, do not generally consider customers’ claims to be justified. In practice, this means that the customer is obliged to repay the debt resulting from a credit obligation which, in their opinion, they did not undertake (i.e. the declaration of intent to enter into a credit or loan agreement, as claimed by the customer, was made de facto by fraudsters or the customer did it unknowingly, against their will, as a result of fraudulent actions of third parties).
As a result, the Financial Ombudsman asked banks (payment service providers) to provide information on the above-mentioned issues, the analysis of which may prove to be important from the point of view of possible further action by the Financial Ombudsman to protect the customers of financial market operators whose interests he represents, in this case in connection with objections concerning so-called ‘click loans’.
Position of the Financial Ombudsman on the provision of banking and non-banking services and insurance products to refugees from Ukraine
18 March 2022
The Financial Ombudsman addressed banks, loan institutions, insurance companies and associations in Poland with demands for good practice in connection with the influx of refugees from Ukraine into our country. In his statements, he drew attention to the difficult living conditions, legal uncertainty and the language barrier of the now two-million and constantly growing group of refugees from Ukraine.
“Refugees leaving Ukraine lose access to their assets located in Ukraine and often do not have sufficient means of livelihood. Thus, people currently seeking protection in Poland may be particularly vulnerable to exclusion, poverty or exploitation,” the Financial Ombudsman writes in his position paper.
Addressing an appeal to financial market operators, the Financial Ombudsman presented proposals to facilitate refugees’ use of products and services offered on the Polish market. For many refugees, the use of a Polish bank account or insurance may be necessary in order to take up employment, regain at least some sense of security or even for everyday life in our country.
“The Financial Ombudsman demands that refugees be provided with at least basic and secure banking services, such as a payment account, an account payment instrument, financial support, necessary in the face of the ongoing armed conflict. It is extremely important to provide refugees not only with an adequate product range, but also with protection from illegal activities, including consumer protection,” says the statement.
The Financial Ombudsman’s demands addressed to companies included:
- provision of customer service also in Ukrainian, including helpline support by Ukrainian-speaking consultants, as well as introduction of Ukrainian in automated customer service systems and multilingual versions of contractual documentation
- simplification of the procedures required to open a payment account, including taking advantage of the offer of a free basic account or a temporary exemption from the costs of opening or maintaining a payment account and the payment instruments (payment card) issued to it
- adaptation of the cost of a consumer credit and loans (in particular the APR and commissions) to the difficult financial situation of refugees from Ukraine
- consideration by banks to temporarily waive fees for the execution of payment transactions to beneficiaries located in the territory of Ukraine, regardless of the amount and currency of the transaction. Possible application of automatic refund of fees for transfers made from Poland to Ukraine and from Ukraine to Poland
- creation of insurance packages dedicated to refugees from Ukraine
- provision of applications and forms as well as handling of correspondence and complaints also in Ukrainian
- special information signage of institutions where customer service in Ukrainian will be available
- coordination of activities related to the implementation of postulates and promotion of good practices by industry associations among their member companies and joint development of new solutions and good practices
The Financial Ombudsman points out that an information campaign on rights and obligations related to financial services aimed at refugees may be helpful. Its aim would be to raise awareness of the protection to which they are entitled and thus counteract possible attempts by those offering funding on conditions beyond those permitted by law to exploit the plight of refugees from Ukraine.
It should be recalled that on 14 March of this year, the Financial Ombudsman intervened following indications received about the broadcast of an advertisement for short-term loans “Kapusta.24”. He asked both the company whose product was featured in the advertisement and the Polish Association of Loan Institutions for an explanation. The Financial Ombudsman assured that he would react to all indications concerning irregularities related to insurance, financial, banking products and services and those of loan institutions offered to Ukrainian citizens in the territory of the Republic of Poland.
In the above context, the Financial Ombudsman calls for effective information to be provided to refugees on possible means of protection and legal assistance, communicated in Ukrainian on:
- the possibilities and ways of making complaints
- the Financial Ombudsman and other entities competent in consumer protection
- out-of-court dispute resolution
- free legal aid provided on the basis of separate provisions
#RFdlaUkrainy – As part of World Consumer Rights Day on 15 March this year, the Financial Ombudsman has joined an information and education campaign by Polish offices aimed at ensuring that Ukrainian citizens are aware of consumer rights enjoyed by all citizens of Poland and the European Union. In addition to the Financial Ombudsman, the following institutions are participating in the campaign: the European Consumer Centre, the Polish Financial Supervision Authority, the Office of Electronic Communications, the Personal Data Protection Office, the Office of Competition and Consumer Protection and the Office of Rail Transport.
#RFdlaUkrainy: Motor third-party liability insurance
17 March 2022
#RFdlaUkrainy – compulsory motor third-party liability insurance for holders of vehicles used in Poland and other European Union countries
Holders of vehicles registered in Ukraine, driving in the territory of Poland and other European Union countries must have a valid “Green Card” policy.
The “Green Card” system was created to make travelling abroad by car easier. It ensures that drivers do not have to buy motor third-party liability insurance (MTPL) in every country they drive through. A “Green Card” can be obtained by purchasing it from the insurance company with which the holder of a vehicle registered in Ukraine has taken out third-party liability insurance for their vehicle as an additional option. The Ukrainian insurer then issues a “Green Card” certificate for your vehicle in addition to your MTPL policy. If you do not have this certificate together with the document confirming that you have taken out MTPL when crossing the border, it is very likely that a “Green Card” was not purchased.
If you wish to travel in Poland or other European Union countries by car, but do not have a “Green Card”, you must take out so-called border third-party liability insurance when entering Poland. This may be done by the owner of the vehicle or any other person currently using the vehicle.
Border insurance can be taken out at most insurance companies offering vehicle insurance in Poland. Border insurance must be taken out for a period of not less than 30 days.
Please be informed that some Polish insurance companies offer free of charge one-month (for 30 days) border third-party liability insurance to refugees from Ukraine. Such insurance can be taken out free of charge via helplines or at the agents of these insurers.
If you have a “Green Card” from Ukraine, you must remember that it expires at the end of the current third-party liability insurance for your vehicle. Then, in order to travel in the territory of Poland, you must take out a new motor third-party liability insurance policy in Ukraine together with a new “Green Card” or take out border insurance in Poland.
Please also note that other motor insurance such as motor hull insurance, accident insurance, assistance and legal protection are voluntary.
#RFdlaUkrainy: School accident insurance
16 March 2022
#RFdlaUkrainy – voluntary accident insurance for school-age children and youth (school accident insurance)
If your child goes to kindergarten, school or university in Poland, it is worth considering taking out school insurance.
School insurance is the most common type of personal insurance in Poland, which primarily provides protection against accidents – hence the common name accident insurance. It also sometimes covers serious or sudden illnesses. Protection is provided all year round (including holidays): at school, on the way to school and at home. If your child is covered by this insurance, then if an accident occurs – the insurer should pay a benefit for the occurrence of permanent damage to health, reimburse the costs of treatment or hospital stay.
The majority of kindergartens, schools and universities in Poland have group insurance contracts for school-age children and youth with standardised coverage, to which your child can be added at any time. The form of a group contract is a very reasonable solution that allows you to get a lower premium than with individual insurance. You can ask about insurance at the school your child will be attending and get detailed information about the coverage, benefits and premium. If insurance for your child is taken out during the school year, the premium should be correspondingly lower than for a full year.
School insurance can also be taken out through individual contracts by contacting an insurance agent, via a helpline or online directly with the insurance company. Then there is a chance to better adapt the cover to your needs: e.g. a higher sum insured resulting in a higher benefit in the event of an incident or also covering practising competitive sports (which is usually excluded in group policies).
World Consumer Rights Day for Ukrainians
15 March 2022
Polish offices in a joint action for consumers from Ukraine. The Financial Ombudsman asks that the published legal advice be widely distributed to individuals and institutions helping refugees.
The Financial Ombudsman has joined an information and education campaign by Polish offices aimed at providing Ukrainian citizens with consumer rights enjoyed by all citizens of Poland and the European Union. The Financial Ombudsman appeals to volunteers, the media, other central and local government offices to pass on published messages, advice and warnings about financial and insurance products to guests from Ukraine.
Every year on 15 March, we celebrate World Consumer Rights Day in commemoration of US President John F. Kennedy’s speech 60 years ago. At that time, he declared that we are all consumers and outlined four basic rights for each of us: the right to be informed, the right to choose, the right to safety, and the right to be heard.
The Financial Ombudsman and 6 other institutions: the European Consumer Centre, the Polish Financial Supervision Authority, the Office of Electronic Communications, the Personal Data Protection Office, the Office of Competition and Consumer Protection and the Office of Rail Transport are preparing useful information for guests from Ukraine.
Officials hope to make it easier for refugees to shop, travel and use services, including financial services and products in Poland and other EU countries. As consumers in the EU are protected under different laws than in Ukraine, Polish authorities want to make the most important issues of our law more accessible to Ukrainian citizens.
According to representatives of the Financial Ombudsman’s Office, the current situation is aggravated by the actions of dishonest entities which take advantage of the difficult position of the victims of the war and may offer them contracts on very unfavourable terms.
The Financial Ombudsman therefore asks volunteers, representatives of national and local media as well as other central and local government offices to distribute as widely as possible the messages, advice and warnings prepared by the experts of the Financial Ombudsman’s Office and published on www.rf.gov.pl and in social media.
Yesterday, the Financial Ombudsman intervened following indications received about the broadcast of an advertisement for short-term loans “Kapusta.24”. He asked both the company whose product was featured in the advertisement and the Polish Association of Loan Institutions for an explanation. The Financial Ombudsman assured in yesterday’s announcement that he would react to all indications concerning irregularities related to financial and insurance products and services offered to Ukrainian citizens in the territory of the Republic of Poland.
Joining the “We are all consumers” campaign, the Financial Ombudsman has published information material in Polish and Ukrainian containing advice to bear in mind when entering into a loan agreement.
Today, the Financial Ombudsman also launched a special email address email@example.com, to which Ukrainian citizens in their native language can address queries, doubts and requests for advice on financial and insurance products and services offered in the Polish market.
From now on, the Financial Ombudsman’s website and its social media channels will successively feature further advice related to the rights and obligations of consumers of financial services. In addition, the Financial Ombudsman’s website, currently available in Polish, English and French, will soon be enhanced with a version in Ukrainian.
Activities of other offices
In the guide “Your rights in Poland – CONSUMER GUIDEBOOK”) (https://www.uakonsument.uokik.gov.pl), prepared in Ukrainian, the Office of Competition and Consumer Protection has focused on basic consumer rights. Guests from Ukraine will learn, among other things:
- where to find free legal aid,
- what to do if a product purchased is faulty,
- what rules apply when shopping in brick and mortar shops and what rules apply when shopping online,
- how to buy safely online.
Also visit the websites of other World Consumer Rights Day partners:
European Consumer Centre: If you are planning to travel from Poland to another country, read the basic information about your rights as a consumer when travelling in the EU, Norway, Iceland and the UK
Polish Financial Supervision Authority: Information on insurers and banks – entity search engine
Office of Electronic Communications: Tips on how to use the services of telecommunications operators
Personal Data Protection Office: How to protect personal data and privacy and how to navigate the internet safely
Office of Rail Transport: Information on free rail travel opportunities. Also find out what your rights are as a passenger
And if you are looking for accommodation, humanitarian aid, transport or any other form of support, visit pomagamukrainie.gov.pl
#RFdlaUkrainy: Beware of quick loans.
15 March 2022
The Financial Ombudsman has received indications of increased activity by entities offering quick and easily accessible loans to refugees arriving from Ukraine. Let us remember that the current situation is aggravated by the actions of dishonest entities which take advantage of the difficult position of the victims of the war and may offer them contracts on very unfavourable terms. Here are some tips to avoid a dishonest lender:
- Verify the entity with which you intend to enter into a contract. For this purpose you can use the register of loan institutions on the PFSA website at the address: https://rpkip.knf.gov.pl/index.html?type=RIP. Remember that Poland has the Consumer Credit Act, which imposes certain obligations on lenders. One of them is the obligation to be entered in the register of the PFSA. If the company you intend to enter into a contract with is not on the register, this is a sign that it may be operating illegally.
- If you do not speak Polish and the contract is drawn up in that language only, ask your family, a friend or another third party who speaks Polish and Ukrainian to read it to you, translate it and assist you in entering into the contract.
- Remember that before entering into a contract you can request information from the lender on the financing offered and you should receive a so-called information form, which contains all the most important information, terms and conditions and parameters of the loan.
- Pay attention to the terms and conditions of the loan, in particular the amount of the loan costs and the interest rate. Remember that there are maximum cost limits in Poland. What is worth noting?
- The maximum cost limit for a loan is 25% of the loan amount plus an additional 30% for each year of duration. In addition, the lender may charge interest at a maximum rate of 14% (as at 9 March 2022).
- The total cost of the loan specified in the contract may not exceed the total amount of the loan. If you borrowed PLN 100, the total non-interest cost of the loan is a maximum of PLN 100 + interest.
- There is no legal obligation to enter into contracts with additional services such as contracts imposing extra costs in the form of insurance fees, loan servicing fees, e.g. for a visit to the place of residence;
- Remember that a contract should be in writing or in another durable medium and you should receive a copy.
- If you need help with your contract, you can take the following steps:
- If you believe you have been a victim of a crime, such as fraud, contact the Police or the Public Prosecutor’s Office and report the crime;
- If you find that a contract is unfair, contrary to consumer law, file a complaint with the lender, and if you do not receive a response or it is negative, you can ask for help or intervention from the municipal or district consumer ombudsman or the Financial Ombudsman. You can find out more about the Financial Ombudsman’s intervention procedures and a model application on the website at: https://rf.gov.pl/en/intervention-procedure/
Communication from the Financial Ombudsman in connection with the broadcast of an advertisement for short-term loans “Kapusta.24” in Ukrainian at Dworzec Zachodni (railway station) in Warsaw
14 March 2022
The Financial Ombudsman has received indications of Miloan Sp. z o.o. with its registered office in Warsaw (hereinafter also referred to as the company), operating under the commercial brand “Kapusta24”, offering consumer credit to persons coming from Ukraine. The advertising banner was placed in the vicinity of Dworzec Zachodni, and the proposed terms were said to be unfavourable, as indicated by the specified APR of 1993.51%.
The Financial Ombudsman, acting ex officio, asked the company’s management to clarify as a matter of urgency the content of the advertisement, the costs of the consumer credit presented in it and to send any information and documents relating to loans already granted on the advertised terms and conditions.
Notwithstanding the above, the Financial Ombudsman requested the Polish Association of Loan Institutions (PZIP), of which Miloan Polska sp. z o.o. is a member, to present the Association’s position on the subject. In particular, the Financial Ombudsman asked about the circumstances in which the advertisement placed at Dworzec Zachodni in Warsaw was created, whether PZIP had taken action against the Company in this case, and whether it had monitored the Company’s compliance with its declaration to remove the advertisement from public space.
As part of its statutory competence, the Financial Ombudsman will respond to any indications received in relation to financial services offered to Ukrainian citizens. In particular, this involves the verification of loan products to ensure that the terms and conditions of lending comply with current legislation.
The Financial Ombudsman is also one of the partners of the “We are all consumers” campaign participated by the following institutions: ECC, UOKiK, UKE, UKNF, UTK and UODO. The Financial Ombudsman will provide information in Polish and Ukrainian on consumer rights and obligations in the domestic financial market.
The Financial Ombudsman sums up the year in Swiss franc cases
1 March 2022
Although the number of active Swiss franc loans is steadily decreasing, there are still several hundred thousand Poles repaying mortgages indexed or denominated in the Swiss franc. It is true that some banks have launched settlement programmes for their customers, but nevertheless many Swiss franc loan holders decide to pursue their rights in court. Cases involving Swiss franc loans also continue to be the subject of numerous requests to the Financial Ombudsman, who has just published an analysis of issues relating to Swiss franc loans.
The analysis conducted by the Financial Ombudsman’s Office of the legal situation and legal and economic events in 2021 indicates an increasingly uniform and pro-consumer interpretation in Polish and EU case-law. In the majority of cases decided in common courts of law, the prohibited nature of the provisions of Swiss franc loan agreements is acknowledged, particularly concerning the conversion mechanism contained therein.
According to various data, there are currently approx. 70 thousand lawsuits in Swiss franc cases in courts of first instance, in second instance – about 4 thousand. Some of the pending Swiss franc proceedings have been suspended pending a comprehensive resolution on Swiss franc loans by the Supreme Court, which has decided to refer a question to the Court of Justice of the European Union for a preliminary ruling in this regard.
The Financial Ombudsman has been involved in helping consumers who are Swiss franc loan holders since the inception of the office. The Financial Ombudsman presented his first report, a legal analysis of selected contractual provisions used by banks in indexed and denominated loan agreements, in June 2016. Since then, the Financial Ombudsman’s Office has been approached by more than 11,000 customers for support in matters related to Swiss franc loans.
The Financial Ombudsman also systematically analyses case-law related to so-called foreign currency loans. In a document just published, the Financial Ombudsman discusses the most important legal issues faced by borrowers and examines the case-law of national and EU courts. He also presents issues that the Financial Ombudsman considers need to be resolved because of their importance for the rights of consumer borrowers.
We invite you to read the document.
Questions and answers about compensation after windstorms
22 February 2022
The effect of the extreme weather phenomena which have recently hit our country are severe losses, including damage to buildings and movable property. The amount of damage caused by atmospheric phenomena has resulted in an increase in the number of telephone calls to expert stands, where injured parties seek information and advice on their rights and assistance in solving problems that arise in reporting the damage. Examples of the most common questions and answers from the Financial Ombudsman’s experts in such situations are presented below.
We also encourage you to contact the Financial Ombudsman’s experts. You can call them during the on-call time. The telephone number 22 333 73 28 is available from Monday to Friday from 8.00 am to 3.00 pm. You can also write an email to firstname.lastname@example.org.
What should I do immediately after the damage, if I have household insurance?
Above all, protect the property from further damage. If, for example, a windstorm has blown the roof off, the damage should – as far as possible – be secured so that the rain does not cause more damage. If possible, move your belongings to another part of the house or other building where there is no risk of flooding. It is worth emphasising that you are entitled to have the costs associated with such work covered. These include, for example, the costs of work and materials used to protect the property from further damage. If you buy, for example, sheeting or other materials to secure a broken roof, or pay someone to do so, take a receipt or invoice. This will be the basis for reimbursement of such costs by the insurer. It is worth noting that voluntary contracts also more and more often include an assistance service, providing for the organisation and coverage of costs of, for example, a roofer’s service. Therefore, after the damage, it is worth calling the insurer at once, describing the whole situation and finding out what kind of help you can count on under the terms of the contract.
Do I have to wait for the arrival of the insurer’s appraiser before removing the consequences of flooding or a windstorm?
You do not have to wait for the arrival of the insurer’s appraiser to start removing the consequences of flooding or a windstorm and carry out repairs. Simply take photos and list what has been damaged in order to have grounds for making claims to the insurer.
The more photos you take and the more accurately they show the damage, the less grounds there are for the insurer to question the extent of the damage. It is also a good idea to collect the damaged dismantled parts in one place so that they can be inspected by the insurer’s representative.
Settlement by phone, is it safe?
In the case of damage resulting from storms or windstorms, insurers are increasingly using so-called simplified claim settlement paths. Then they do not send their experts to look at a blown-off roof or a flooded house. They ask the client to send photos, a description of the incident or information from the cooperative. Sometimes they use smartphone applications that allow them to inspect the damage in real time. On this basis, they decide whether to accept liability and assess the cost of repair. Then they call the client offering to pay a certain amount.
Before making a decision, a renovation contractor should be consulted. It is advisable to agree with the contractor at once on a detailed, preferably written estimate of the work. The point is to have a clear idea of the cost of repair at the time of making a decision on settlement. The aim is to avoid a situation in which, after the settlement has been accepted and work has been undertaken, it turns out that the cost of renovation is higher than the amount of compensation received. Withdrawing from a settlement can be troublesome, especially if 14 days have passed since the settlement was reached. It is also worth remembering that people using their household insurance only have 14 days from the date of the settlement to possibly withdraw from it.
It is important to remember that a settlement is reached through negotiation and mutual concessions. This means that if the offer made does not suit you, you can make your own proposal. This, in turn, may result in a counter-offer from the insurer. This is normal in this claim settlement procedure. It is important to remember that in a settlement, the parties do not agree on the amount of damage, but on the amount of compensation, which may be an estimate and will not always reflect the value of the damage. If the terms of the settlement do not suit you, you have every right to a standard claim settlement, with the participation of an appraiser, preparation of a detailed cost estimate. The possibility of filing a complaint is also open, and if you are still not satisfied with the amount of compensation, there is still the possibility of entering into a dispute, e.g. with the support of the Financial Ombudsman.
A reminder! More about claim settlement ‘by phone’ in a special Financial Ombudsman’s Analysis (click the link below).
I was paid the undisputed amount, I got the compensation, but still not enough to cover the entire damage. What should I do?
If you dispute the amount of the compensation offered, you should first ask the insurance company for an accurate estimate showing how the compensation was calculated. This will show you which elements were included and which were not, and how the damaged elements were valued. You should remember that the insurance company is obliged by law to provide you with all the information you are interested in relating to the compensation procedure.
With this information you can write a complaint to the insurance company. If you wish to dispute the values given in the estimate, a real estate appraiser can help you with this.
In the case of legal doubts, e.g. double calculation of the wear and tear indicator of the building in compulsory insurance of agricultural buildings on a farm or application of the proportion principle in the voluntary household insurance, you may contact the Financial Ombudsman. However, please remember that you can contact the Financial Ombudsman in this regard only after exhausting the complaint procedure.
How long does the procedure take from the submission of the compensation claim to the payment of compensation?
The insurance company should pay compensation within 30 days of the submission of the claim. Only in exceptional cases can the company exceed this 30-day period, and it must have grounds for doing so. This can include problems with explaining the circumstances of the incident or determining the amount of compensation.
In any event, in this period you should, firstly, receive the so-called undisputed amount of compensation, and secondly, receive an explanation as to what circumstances prevented the completion of the claim settlement process.
The maximum waiting time for the total compensation depends on your contract. In the case of voluntary household insurance, the regulations provide that the insurance company has 14 days to pay the benefit from the day on which, by exercising due diligence, it was possible to clarify the above-mentioned circumstances.
As regards compulsory insurance of agricultural buildings, it is somewhat different. In this case, the regulations also provide that the insurer has 14 days to pay the benefit from the day on which, by exercising due diligence, it was possible to clarify the above-mentioned circumstances. However, this may not exceed a period of 90 days from the date of establishment of the notification of claim. However, the legislator has provided for one exception to justify an extension of this deadline. This is possible if the determination of the insurer’s liability or the amount of compensation depends on pending criminal or civil proceedings.
What should I do if I do not agree with the insurer’s estimate of the loss?
In this case, a complaint must be made to the insurance company. But before doing so, read the letter from the insurer carefully. At this point it is worth noting the problem which the Financial Ombudsman notices after every major windstorm that passes through Poland – insurers pay out the so-called indisputable amount of PLN 1-3 thousand very quickly after notification. This money is not the compensation finally agreed upon. It is intended to cover expenses such as securing damaged property.
Insurers do not always explain this issue clearly and precisely enough. This is why there are calls to the Financial Ombudsman helpline from people who are concerned that this is the final amount and request the intervention of the Financial Ombudsman. In this case, however, it is premature, given that the claim settlement procedure has not been completed and, therefore, the compensation may be added to the undisputed amount.
It is worth emphasising that the Financial Ombudsman is not able to intervene on the basis of a telephone call. It should also be remembered that the Ombudsman can only intervene or conciliate after the insurer has rejected the customer’s complaint.
When should I receive the insurance company’s reply to my complaint?
If it happens that you have to make a complaint to the insurance company, the insurance company will have 30 days from the date of receipt to respond. The mere fact that the insurance company sends its reply to the complaint is sufficient to meet this deadline.
In particularly complicated cases, which make it impossible to handle the complaint and provide a reply within the aforementioned time limit, the insurer explains to the customer the reason for the delay, indicates the circumstances that need to be established in order to handle the case and sets an expected time limit for handling the complaint and providing a reply, which may not exceed 60 days. If it fails to do so, the complaint is deemed to have been handled as requested by the customer. If it provides a timely but negative response, you can ask the Financial Ombudsman to intervene.
The wind destroyed our house, which we renovated with our own efforts two years ago. However, the insurer only paid us part of what we had spent on, for example, laying the roof. What can I do to get more compensation?
Most likely, the insurer did not take into account the fact that the building had been renovated. If so, it should prepare new calculations. If you have receipts for what was renovated two years ago, please collect them and keep them. If not, it’s also worth looking for photos, the ones from a mobile phone showing the state of the building before and after the renovation will also be useful.
Maybe someone in the family took some photos before and after the renovation? You should also keep the remains of the new part of the roof, metal roofing tiles, windows or doors. An appraiser should come and reassess the damage. This should be enough to show that these were new elements.
The type of contract may also affect the method of calculating compensation. In the case of voluntary insurance, property no more than 20-50 years old can be insured at the new (also called replacement) value, depending on the type of property or the terms of the contract.
In the case of older buildings, the so-called real value applies, i.e. technical wear and tear is taken into account when calculating compensation. But the insurer should take into account any renovations to the building and adjust upwards the valuation of the property.
The wind destroyed my wooden barn built in the 1950s. Will I get compensation from compulsory insurance of agricultural buildings to build a new brick one?
According to the law governing the conditions of compulsory insurance of agricultural buildings at the so-called new value (i.e. allowing the reconstruction of the property), only relatively new buildings and buildings whose degree of wear and tear on the date of conclusion of the insurance contract does not exceed 10% can be insured without additional formalities.
In the case of older buildings, especially those that have not been renovated, the percentage of wear and tear is higher and then the compensation is paid at the so-called real value. This means including technical wear and tear in the reconstruction costs at the rate indicated in the policy when insuring the building, so the compensation will not be enough to build a new barn using new technology.
In fact, some insurers calculate this technical wear and tear twice: before the conclusion of the contract and after the damage. It should also be remembered that the upper limit of the insurance company’s liability is always the sum insured indicated in the policy, i.e. corresponding to the value of the building insured. Therefore, the compensation will never exceed the value of the old barn, built in the 1950s.
I had compulsory insurance of agricultural buildings. The compensation paid does not take into account the furniture destroyed after the roof was blown off. Why?
Compulsory insurance of agricultural buildings does not cover movable property stored in the house. This means that if furniture, carpets, clothes, etc. are damaged after the roof has been blown off, compensation under such a policy will not be available. However, damage to the structure of the building (e.g. blown-off roof, damaged walls) should be covered by insurance. Therefore, when taking out compulsory insurance of agricultural buildings, it is worth considering taking out voluntary insurance of movable property stored in the house as well.
In this context, it is worth recalling that the insurance company is obliged to reimburse the policyholder, justified by the circumstances of the event, for the costs incurred in order to prevent the loss from increasing. This means that if, for example, in order to prevent further flooding of floors or walls after the roof has been blown off or damaged, you buy sheeting and hire a specialist to temporarily secure the damage, the insurer should reimburse you for the costs incurred. The only thing to remember is to document the purchase of materials and work with receipts.
Is a photovoltaic installation covered by compulsory insurance of agricultural buildings if it is located next to buildings?
According to the Financial Ombudsman’s experts, compulsory insurance of buildings on a farm should also cover photovoltaic installations located next to buildings.
There is no doubt that if such devices are installed directly on a building, their possible destruction will be covered by compulsory insurance of buildings on a farm. Of course, it should be remembered that after their installation the sum insured for a given building should be increased accordingly.
The background to a dispute with the insurer may be liability for damage to a photovoltaic installation located next to buildings. If you are refused by your insurer, it is worth asking for expert support from the Financial Ombudsman. In their opinion, the insurance company should also accept liability for damage to the installation located next to the building under compulsory insurance of agricultural buildings.
Please note that according to Article 2(2) of the Act on Compulsory Insurance, a building forming part of a farm is a civil structure with an area exceeding 20 m² as defined in Article 3(2) of the Construction Law. According to this provision, a civil structure is a structure which is permanently connected to the ground, separated in spatial terms by means of building partitions and has foundations and a roof. In turn, pursuant to Article 3(1) of the Construction Law, a civil structure is a building, a structure or a small architectural object, including installations ensuring that the structure can be used for its intended purpose, erected using construction products.
In view of these provisions, the Ombudsman’s experts are of the opinion that photovoltaic installations – as well as any other installations ensuring the possibility of using the structure, such as electrical or gas systems – are covered by the insurance. The regulations do not specify where the installations should be located. The functional relationship is important here. If the installation is intended to ensure that the structure can be used for its intended purpose, it is irrelevant whether it is located on the building or next to it. There are also decisions of administrative courts stating that photovoltaic systems are technical infrastructure facilities. It should therefore be assumed that photovoltaic installations should be covered by compulsory insurance.
The same applies, for example, to central heating furnaces, air conditioning systems or electrical systems. If they are damaged by the elements provided for in the terms of the compulsory insurance contract for agricultural buildings, the damage should be covered by such a policy.
Does compulsory insurance of agricultural buildings also cover damage resulting from so-called surge and damage due to its occurrence to, for example, a central heating furnace, an air conditioner or a photovoltaic installation?
According to the Financial Ombudsman’s experts, yes, although it is worth being aware that this issue can be the background to a dispute with the insurer. Compulsory insurance of buildings on a farm covers damage caused by fortuitous events in the form of fire, storm, flood, flooding, torrential rain, hail, snowfall, lightning, explosion, landslide, rockfall, avalanche or aircraft crash.
So-called surge is not explicitly mentioned in this list. Normally, in the terms and conditions of voluntary contracts, it is defined as a sudden increase in voltage in the system due to a lightning strike in the vicinity. It can cause damage to photovoltaic installations, modern furnaces, air conditioning or electrical components.
The Act on Compulsory Insurance only refers to lightning strikes and consequential damage. An increase in the voltage on the network can undoubtedly be the result of a lightning strike.
It is also important to bear in mind the principle arising from Article 22(1) of the CIA, according to which, in matters not provided for in the Act, the provisions of the Civil Code shall apply. Therefore, general provisions on liability for damages will be applicable in this respect.
Recalling the statements of legal scholars, it is worth pointing out that “according to Article 361 § 1 of the Civil Code, liability for damages relates to normal consequences of a given event. The Civil Code (nor the Act on Compulsory Insurance) does not therefore introduce a limitation in the form of a condition of directness of consequences. Therefore, indirect consequences of one of the events listed in Article 67(1) will also be covered insofar as their occurrence remains in an adequate causal relationship with the insured fortuitous event. There is no doubt that compensation under insurance contracts is subject to the same rules as compensation under the general provisions of the Civil Code, taking into account statutory and contractual modifications concerning insurance relations. The theory of adequate causal relationship will therefore also apply. Therefore, in the situations mentioned as examples above, the insurer’s liability will apply. Undoubtedly, in these cases, the damage is causally linked to the insured event and the criterion of normal consequences is fulfilled”.
 Nawracała Jakub in: Serwach Małgorzata (ed.), Komentarz do ustawy o ubezpieczeniach obowiązkowych, Ubezpieczeniowym Funduszu Gwarancyjnym i Polskim Biurze Ubezpieczycieli Komunikacyjnych, [in:] Prawo ubezpieczeń gospodarczych. Tom I, Komentarz, wyd. II, LEX 2010
What if I do not have insurance and a tree damages my car or house?
In theory, it is possible to pursue a claim against the person or entity responsible for maintaining this tree. This is due to the principle that the owner must keep it healthy, remove rotten branches. For example, if the trunk of a tree has rotted, it must be cut down completely so that it does not pose a safety risk. If the requirements were met – the tree was healthy – and it was broken or uprooted by the wind, it would be difficult to blame the responsible party.
And without specifying that they are at fault and not force majeure in the form of wind, coverage of damage under their third-party liability insurance policy (if any) will not be available. However, it is better to have your own motor hull insurance or household insurance.
Remember to take out a valid third-party liability insurance policy!
3 February 2022
The Financial Ombudsman reminds that due to the increase in the minimum wage, penalties for not having compulsory insurance have increased since January 2022.
At the beginning of 2022, along with the increase in the minimum wage, there was also an increase in the penalty fee for not having motor third-party liability insurance (MTPL), as well as for not having third-party liability insurance of farmers being the owners of a farm (farmer’s third-party liability insurance) and insurance of buildings forming part of a farm against fire and other fortuitous events (insurance of agricultural buildings).
The lack of continuity in insurance cover may result not only in a financial penalty, but is primarily associated with the need to cover the costs of redressing the damage (in the case of third-party liability insurance contracts) and the lack of compensation in the case of events resulting in damage to buildings.
In the case of motor third-party liability insurance, the amount of the penalty fee for not having insurance depends on:
1. Vehicle type
- for passenger cars, it is the equivalent of 2 times the minimum wage
- for trucks, tractors and buses, it is the equivalent of 3 times the minimum wage
- for other vehicles, it is the equivalent of 1/3 of the minimum wage
2. The period of time without insurance cover in a given calendar year:
- up to 3 days – 20% of the full penalty fee
- from 4 to 14 days – 50% of the full penalty fee
- more than 14 days – 100% of the penalty fee
In order to avoid any unpleasant situations, particular attention should be paid in cases where the regulations of the Act on Compulsory Insurance, the Insurance Guarantee Fund and the Polish Motor Insurers’ Bureau, which provide for an automatic extension of insurance cover, the so-called prolongation clause, do not apply to our agreement.
As a reminder, the cases when there is a break in the continuity of MTPL insurance resulting in the imposition of penalties by the Insurance Guarantee Fund (UFG) are provided below. These include:
- When the contractually agreed premium for the past period has not been paid in full – this usually occurs when the vehicle owner pays the premium in instalments, but also when the premium – despite the contract – is not paid at all. In this situation, the prolongation clause does not apply (the contract will not be renewed for another 12-month period). Therefore, before the end of the contract period, it is worth checking whether the premium has been paid in full (if in doubt, contact your insurer).
- Where the insurance company ceases to be authorised to carry on insurance business in respect of compulsory motor third-party liability insurance. The prolongation clause is not applicable in this situation either.
- The vehicle is sold and the buyer of the vehicle decides to use the valid policy of the seller of the vehicle, but does not take out a new policy on their own behalf after its expiry. As the law now stands, the contract entered into by the seller will not be automatically renewed at the end of the period for which it was signed. In such a situation, it is necessary to enter into a new contract for a new period in order to maintain continuity in the coverage.
- An MTPL insurance contract is entered into by the holder of a motor vehicle who is not the owner of that vehicle. The rights and obligations of that holder under the insurance contract entered into are transferred to the owner of the motor vehicle as soon as the holder has ceased to possess the vehicle for the benefit of the owner. However, the insurance contract entered into by the holder is terminated at the end of the period for which it was signed. The clause providing for the automatic renewal of the contract will not apply in this case either.
- In the case of a declaration of bankruptcy of the insurance company, a declaration or order to wind up the insurance company, or rejection of a bankruptcy petition or discontinuance of bankruptcy proceedings. In this situation, the prolongation clause does not apply (the contract will not be renewed for another 12-month period).
Regardless of cases of non-renewal of the insurance contract by operation of law, particular vigilance must be exercised when there is a transfer of ownership of a vehicle but the seller has not provided the buyer with a valid MTPL insurance contract. When buying a vehicle, the buyer should immediately (on the same day) verify the data in the UFG database and, in the case of confirming the lack of a valid contract, insure the vehicle on the day of acquiring the ownership and not later than when putting the vehicle into use. Analogous principles apply to the transfer of possession of a vehicle. In addition, the buyer, having received the MTPL insurance contract from the seller, in order to be sure, should contact the insurer to confirm the validity of the contract.
A change in the penalty fee for not having insurance will also apply to third-party liability insurance of farmers being the owners of a farm (farmer’s third-party liability insurance)and insurance of buildings forming part of a farm against fire and other fortuitous events (insurance of agricultural buildings). Both types of insurance are compulsory.
The penalty fee for not having a third-party liability insurance contract is also calculated based on the minimum wage. The penalty fee for not having farmer’s third-party liability insurance is 1/10 of the minimum wage in the year of inspection, and for not having insurance of agricultural buildings 1/4 of the minimum wage.
In the case of farmer’s third-party liability insurance and in the case of insurance of agricultural buildings, there is a similar principle of automatic renewal as in the case of MTPL insurance. If the farmer does not give written notice of termination to the insurance company not later than one day before the expiry of the 12-month period for which the insurance contract was concluded, a new contract will be deemed to have been concluded for further 12 months.
As a reminder, the exceptions to this rule, i.e. cases when there is a break in the continuity of farmer’s third-party liability insurance and insurance of agricultural buildings, resulting in the imposition of penalties, are provided below. These include:
- When the contractually agreed premium for the past 12-month period has not been paid. In this situation, the prolongation clause does not apply (the contract will not be renewed for another 12-month period). Therefore, before the end of the contract period, it is worth checking whether the premium has been paid in full (if in doubt, contact your insurer).
- Where the insurance company ceases to be authorised to carry on insurance business in respect of compulsory farmer’s third-party liability insurance. In this situation, the prolongation clause does not apply either (the contract will not be renewed for another 12-month period).
- In the case of a declaration of bankruptcy of the insurance company, a declaration or order to wind up the insurance company, or rejection of a bankruptcy petition or discontinuance of bankruptcy proceedings. In this situation, the prolongation clause does not apply either (the contract will not be renewed for another 12-month period).
- There is a transfer of possession of a farm. In the case of transfer of possession of a farm (also by inheritance), the buyer may use the existing farmer’s third-party liability insurance contract and the insurance contract for agricultural buildings until the end of the period for which they were concluded, however, they will not be automatically renewed in the case of inheritance.
IMPORTANT: Where a farmer gives possession of a part of a farm which constitutes a separate farm, the person who takes possession of the part of the farm given up does not benefit from any insurance contract hitherto concluded. Such person is obliged, as soon as they take possession of that part of the farm, to enter into a new insurance contract.
It is also worth remembering that the obligation to enter into a farmer’s third-party liability insurance contract arises on the day of taking possession of a farm, and an insurance contract for agricultural buildings on the day of covering the building with a roof.
Thus, as in the case of acquisition of ownership or possession of a motor vehicle, it is of the utmost importance to establish whether the previous holder has complied with the obligation to enter into both contracts.
Also, if the existing contract is terminated, continuity of insurance must be maintained by entering into another contract.
The bank must give the commission back to the customers
18 January 2022
The Supreme Court has upheld the Financial Ombudsman’s extraordinary complaint on the settlement of early repayment of a credit
After a court battle lasting several years, borrowers who repaid their credits early will receive a refund of part of the commission previously charged by Alior Bank. This is the result of an extraordinary complaint by the Financial Ombudsman. This decision is important for all customers with whom banks have refused to settle, despite paying off their liabilities earlier than the agreement and the schedule would indicate.
The case originated in February 2016, when Alior Bank customers took out a consumer credit of PLN 50 thousand. The bank charged PLN 16.7 thousand for granting the credit, and the total liability was to be repaid over a period of 10 years. However, the customers managed to repay the credit in full after just 14 months. In accordance with the law, they therefore expected a return from the bank of the proportional value of the commission, i.e. almost PLN 15 thousand. However, the bank had no intention of settling this liability. The case ended up in court, as the borrowers filed a lawsuit for payment.
The District Court in Kielce, which was the court of first instance, found the claimants’ arguments justified and awarded the amount indicated in the claim. Alior Bank filed an appeal, as a result of which the District Court in Kielce, as the court of second instance, changed the judgement and dismissed the claim, arguing that Article 49 (1) of the Consumer Credit Act does not justify the customers’ claim and that the commission is not a cost related to the term of the loan.
From the outset, the Financial Ombudsman shared the view of the court of first instance that the bank should refund part of the commission to the borrowers as a result of early repayment of the credit. In the event of early repayment of a consumer credit, the total cost of such credit is reduced proportionately.
The Financial Ombudsman did not share the view of the court of second instance, considering that the judgement was in flagrant breach of law, and since the judgement could not be challenged by means of an appeal against the sentence, the Financial Ombudsman decided to file an extraordinary complaint.
As a result of the examination of the extraordinary complaint filed by the Financial Ombudsman, the Supreme Court upheld the arguments presented in the complaint and set aside the contested final judgement of the District Court in Kielce. The bank was also ordered to pay the costs of the appeal.
For the borrowers, this means that the judgement of the court of first instance, ordering the refund of the commission for early repayment to them, is a final judgement, and the bank should pay the customers the amount claimed in the lawsuit together with the claimed interest specified in the operative part of the judgement of the court of first instance.
The Financial Ombudsman has repeatedly presented his position on the interpretation of this provision. According to it, in the event of early repayment of a consumer credit, the total cost of such credit is reduced. The nature of these costs and when they were actually incurred by the borrower is irrelevant. This reduction is proportional, i.e. it relates to the period between the actual repayment of the credit and the final repayment date stipulated in the agreement. Settlement of credits according to such rules may be claimed by all customers who entered into an agreement after 18 December 2011. At that time, the provisions of the Consumer Credit Act entered into force, governing, inter alia, the principles of settlement of credits repaid earlier.
Early repayment obliges banks to refund the commission
The court’s decision is important for anyone who has been refused by a bank or loan company the lawful settlement of a credit repaid earlier. The course of action depends on how the dispute ended.
If the case has already been finally decided by a court and the court has dismissed the customer’s claim, it is possible to request the Financial Ombudsman to file an extraordinary complaint. However, this only applies to final judgements made after 3 April 2018. If the case is still pending in court, it is possible to request the Financial Ombudsman to provide an important view on the case.
Customers who have repaid a consumer credit earlier, but have not received a pro rata refund in accordance with the law can still pursue claims. A complaint should first be made to the bank or loan company. If it is not accepted, the Financial Ombudsman can be requested to intervene.
Important! When to file a request for an extraordinary complaint to the Financial Ombudsman?
Requests to the Financial Ombudsman to file an extraordinary complaint may relate to decisions ending proceedings in a case which became final after 3 April 2018. Only the Attorney General and the Ombudsman have the power to make an extraordinary complaint in respect of cases decided before that date.
It is worth emphasising that an extraordinary complaint is intended to apply to truly exceptional situations. One of the three prerequisites must be present:
the judgement violates the principles or human and civil liberties and rights set forth in the Constitution;
the judgement grossly violates the law by being misinterpreted or misapplied;
there is a clear contradiction between significant findings of the court and the content of evidence gathered in the case.
In addition, an extraordinary complaint will also be allowed only if the contested decision cannot be changed or reversed by other extraordinary means of appeal. Moreover, an extraordinary complaint may not be based on allegations that were the subject of an appeal against the sentence or cassation examined by the Supreme Court. In addition, an extraordinary complaint may be brought only once against the same judgement in the interests of the same party.
In order for the Financial Ombudsman to be able to prepare an extraordinary complaint, it is essential that he is provided with as complete a record of the case as possible. That means the applicant must describe the objections to the judgement, present the pleadings, the judgements of both courts with reasons, and the evidence. Only on this basis can the Financial Ombudsman decide to apply to the Supreme Court. Ideally, such a motion should be prepared by a professional attorney who already knows the case and has handled it in previous instances. He will also know best which prerequisites for filing an extraordinary complaint are met in a given case. Of course, this is not a formal requirement. If someone cannot afford to engage an attorney, the Financial Ombudsman’s lawyers will perform such an analysis based only on the documentation provided.
Important resolution of the Supreme Court upon the Financial Ombudsman’s motion
14 January 2022
On 14 January 2022, the Supreme Court, composed of seven judges, issued a resolution favourable to victims regarding the scope of liability under a motor third-party liability insurance contract (MTPL) for damage caused by the use of multi-purpose vehicles. This resolution is important for victims of accidents involving excavators, bulldozers, agricultural machinery, etc., as it will enable them to pursue claims against insurance companies more effectively.
On 18 August 2020, the Financial Ombudsman filed a motion with the Supreme Court (ref. No. III CZP 7/22) to adopt a resolution aimed at resolving divergences existing in case-law with respect to the scope of liability under a compulsory motor third-party liability insurance contract for damage caused by the use of multi-purpose vehicles (excavators, bulldozers or agricultural tractors with attached agricultural equipment, etc.).
The Financial Ombudsman’s intervention was related to the divergence, noticed by his experts, in the interpretation by national courts of the concept of ‘use of a vehicle’ and, consequently, also the divergence in the interpretation of the scope of liability under a motor third-party liability insurance contract in the case of damage caused by the operation of multi-purpose vehicles.
On 14 January 2022, the Supreme Court issued the following resolution:
Liability of an insurance company arising from a compulsory motor third-party liability insurance contract covers damage caused as a result of operation of equipment installed in the vehicle, also when, at the moment when the damage was caused, the vehicle did not perform its motor function (Article 34 of the Act of 22 May 2003 on compulsory insurance, the Insurance Guarantee Fund and the Polish Motor Insurers’ Bureau – consolidated text: Journal of Laws of 2021, item 854 in connection with Article 436 of the Civil Code).
According to the operative part of the resolution, the Supreme Court has shared the position presented by the Financial Ombudsman with regard to the scope of the insurance company’s guarantee liability resulting from compulsory MTPL insurance, related to the use of multi-purpose vehicles.
Initially, the interpretation of the use of a vehicle arising from the case-law of the Polish courts was very broad. This concept was understood as the use of vehicles regardless of the function they performed at the time of the accident, i.e. whether they were used as a means of transport or as a work tool. The decisive factor involved was the operation of the engine, which was undoubtedly a favourable interpretation for the victims who were injured or killed in incidents at the interface between the vehicle’s transport and working functions.
Subsequently, a trend towards a narrower definition of the term ‘use of vehicles’ could be observed. This approach started to become apparent after the CJEU ruling C – 514/16. The line of case-law unfavourable to victims was also presented by the Supreme Court in its judgements of 8 September 2019 (IV CSK 292/18) and 10 October 2019 (I PK 137/18). These rulings point to the need to distinguish between the function that the vehicle concerned was performing at the time of the damage, i.e. that of a transport or work tool.
The resolution of the divergence noted by the Ombudsman was particularly important in view of the fact that very serious personal injuries (death and permanent disability) often occur with this type of multi-purpose vehicles, including slow-moving vehicles used
A perfect example illustrating the scale of the problem and the misfortune which often befalls people working hard on farms is an incident which occurred during field work. In this case, the accident occurred while working in the field with a tractor to which a straw baling machine was connected, driven by the tractor’s engine through a shaft connecting the machine to the tractor. After completing the straw pressing and baling work, the father instructed his son to check that the straw baler was working properly. At the same time, he did not immobilise the tractor, which was in constant motion.
When the victim was on the wheel of the baler, trying to pull out a screwdriver that had fallen into it, the rotating rollers caught his arm, which was pulled through the baler, crushing the entire limb including the axillary vessels. This incident resulted in an injury to the upper limb resulting in amputation.
In this case, the insurer refused to accept liability under the compulsory motor third-party liability insurance taken out. However, the adjudicating court, in accordance with the prevailing line of case-law at the date of adjudication, allowed the claim. In the justification, the court stated that the agricultural tractor connected to the straw baler (in which the engine was still running) constituted a mechanical means of communication within the meaning of Article 436(1) of the Civil Code and a motor vehicle within the meaning of the Act of 22 May 2003 on compulsory insurance, the Insurance Guarantee Fund and the Polish Motor Insurers’ Bureau (the CIA).
Similar unfortunate incidents, such as the one described above, are often referred to the Financial Ombudsman by victims. Unfortunately, the existing divergences in the line of case-law
in terms of the concept of ‘use of a vehicle’, make it difficult for the Financial Ombudsman to provide the expected assistance to victims. Hence, in order to stop this unfavourable jurisprudential trend for victims of accidents involving multi-purpose vehicles, by preparing a motion to the Supreme Court, the Financial Ombudsman aimed to shape a uniform line of case-law emphasising a broader view of the concept of ‘use of a vehicle’ (definitely more favourable for the victims).
The Financial Ombudsman pointed out that the interpretation of ‘use of a vehicle’ in the CJEU ruling of 28 November 2017 (C – 514/16) does not require that Polish courts have to depart from the previous line of case-law in view of this judgement. Indeed, EU law does not preclude the recognition that the use of a vehicle within the meaning of Article 34 of the CIA also covers the use of a vehicle as a work tool. On the contrary, it should be stated that the regulations of Directive 2009/103/EC of the European Parliament and of the Council of 16 September 2009 relating to insurance against civil liability in respect of the use of motor vehicles, and the enforcement of the obligation to insure against such liability are only of a minimum nature and therefore going beyond the minimum standards set out in the Insurance Directive should be considered acceptable and even desirable.
Another step towards normalising the lending market. Victory for the Financial Ombudsman
11 January 2022
A few months ago, the Financial Ombudsman informed about joining the case of a client who lost the proceedings in the first instance with Profi Credit Polska and, as a result of the court ruling, had to repay more than 2.5 times the value of the loan. The District Court in Częstochowa, as the court of second instance, in proceedings with the participation of the Financial Ombudsman, changed the decision of the court of first instance, reducing the debt of the defendant client by almost PLN 7 thousand. According to representatives of the Financial Ombudsman, the court ruling is an important step towards normalisation of the lending market.
The client, who was sued by the lender, entered into a loan agreement under which she received PLN 6,000 ‘in hand’. The client repaid PLN 3,990 to the loan institution, stopping further repayments due to financial problems caused by a difficult life situation. The agreement was terminated by the company, which took the matter to court with regard to the demand for payment. The court of first instance recognised that Profi Credit Polska S.A. was right and awarded the amount of PLN 9,972.63 together with interest and legal costs. This meant that the client was obliged to repay a total of almost PLN 14,000 of the principal amount alone (the principal of the loan and the costs of the loan), to which interest rising every day had to be added, as well as litigation costs amounting to over PLN 2,000.
The client disagreed with the decision made at first instance and appealed. At the same time, she requested the Financial Ombudsman to join the case and assist in the ongoing proceedings.
The District Court in Częstochowa, as the court of second instance, in proceedings with the participation of the Financial Ombudsman, changed the decision of the District Court in Myszków. As a result of the changed decision, the client is required to repay to the loan institution only PLN 3,153.63 plus statutory interest. This means that the debt was reduced by PLN 6,837. Moreover, the company is obliged to reimburse the client for the legal costs of both instances.
Such a settlement was also made possible by the active participation of the Financial Ombudsman.
“We have broadened the spectrum of legal arguments and pointed out that the provisions relating to the costs of the loan are abusive in many respects. We relied here on the broad case-law of the Court of Justice of the European Union, which has repeatedly stated that even if the costs of a loan are within the statutory limit, this does not mean that provisions determining their amount may not be prohibited,” explains Paulina Tronowska, legal adviser at the Financial Ombudsman’s Office.
According to the Financial Ombudsman’s experts, the above judgement also gives hope to other clients who have entered into credit or loan agreements involving high commissions, preparation fees or other costs which in no way correspond to the amount of financing granted, to win against the loan institution or other creditor.
The Financial Ombudsman provides support to clients of financial market operators at various stages of a dispute with a creditor. The Financial Ombudsman’s experts provide advice, intervene and conduct conciliation proceedings. In the event of a court dispute, the Financial Ombudsman may provide a so-called important view for the case and, in particularly justified cases, may bring an action on behalf of the client or join ongoing proceedings.
Details are available on the Financial Ombudsman’s website.
Mr Ziemowit Bagłajewski appointed as Deputy Financial Ombudsman
28 December 2021
As of 22 December 2021, Mr Ziemowit Bagłajewski was appointed as Deputy Financial Ombudsman.
Ziemowit Bagłajewski is a graduate of the Faculty of Law and Administration of Warsaw University and a lawyer with many years of experience. From 2015 to 2021, he pursued the profession of a lawyer, since 2012, he has been a member of the Warsaw Bar Association.
Mr Bagłajewski has extensive experience in litigation, in particular in matters relating to the protection of the interests of clients of financial market entities. He is an expert in the field of organisation and functioning of the financial market and legal regulations creating the environment for this market.
The newly appointed Deputy Financial Ombudsman will oversee the Extrajudicial Dispute Resolution Division and the Administration and Finance Division in the Office of the Financial Ombudsman.
Dr Bohdan Pretkiel appointed as Financial Ombudsman
09 December 2021
On 7 December the Prime Minister, upon the motion of the minister competent for financial institutions, appointed Mr Bohdan Pretkiel as Financial Ombudsman. The term of the Financial Ombudsman is 4 years.
Dr Bohdan Pretkiel graduated summa cum laude from the Faculty of Law and Administration (WPIA) at the University of Warsaw (UW). He received his PhD degree with honors in the field of legal sciences from this university in 2018. He was also educated at the Vilnius University. Since February 2020, he was an assistant professor at the Faculty of Law and Administration of the University of Warsaw (Department of Logic and Legal Argumentation). Since 2012 he has been teaching legal logic at WPIA UW. Author of papers, scientific articles and monographs.
Barrister and lawyer with many years of experience. He worked, among others, in law firms, where inter alia he dealt with problems in the field of financial law. He has served as Chief Executive Officer of a capital group. Member of the Supervisory Board of the Polish Investment and Trade Agency from August 2018 to February 2021. Member of the expert team on building the institution of civil dialogue at the Government Plenipotentiary for Civil Society since April 2016. President of the think-tank known as Mikołaj Sienicki Institute since December 2017.
The Financial Ombudsman files a claim against UNIQA S.A.
29 November 2021
The Financial Ombudsman filed a lawsuit against UNIQA TU S.A. insurer for using unfair market practices against clients purchasing the so-called costed Auto Casco variants. The Financial Ombudsman’s reservations concern the application of different criteria for estimating total and partial damage.
– As announced, we continue to file lawsuits against insurers offering unfair Auto Casco insurance terms. At the same time, we are in talks with those who have declared a voluntary change to the content of their contracts. I’m hoping that more insurers will join the latter group. This is also possible as part of a court settlement, says Prof. Dr. Habil. Mariusz Jerzy Golecki, the Financial Ombudsman.
Lawsuits of the Financial Ombudsman are filed pursuant to Article 12 of the Law on Counteracting Unfair Market Practices, i.e. in the interest of consumers as a whole. The Financial Ombudsman has reservations about the application of non-uniform criteria for evaluating the costs of repairing a damaged vehicle. It all depends on whether the insurer sees the possibility of admitting the so-called total loss, i.e. recognizing that repairing the vehicle is economically unjustified. In AC contracts it is standard to admit it if repair costs exceed 70% of the car’s value before the damage.
– To achieve this, insurers use the prices of the most expensive original parts with the logo of the car manufacturer and the highest possible labour costs used by authorized service stations. Crucially, such a proviso also applies to costed insurance variants. These are the ones in which the client agreed to fix the compensation according to flat rates for repair in the range of PLN 65 or PLN 90 or according to prices applied by repair shops other than ASO and using the cheapest, non-original parts. In our opinion, costs of a hypothetical repair for the purpose of determining the total loss should also be estimated according to such principles – explains Eliza Gużewska, Deputy Director of the Insurance and Pension Market Customer Division.
Previous actions by the Financial Ombudsman on this issue:
October 2021 – Financial Ombudsman settlement with InterRisk. On 24 September 2021 in the District Court in Warsaw a settlement was signed between the Financial Ombudsman and InterRisk, on the basis of which the Insurer will change the content of the General Conditions of Auto+ Package Insurance as required by the Financial Ombudsman, approved by Resolution no. 04/25/06/2019 of the Management Board of InterRisk
July 2021 – Another settlement in a dispute over the terms of Auto Casco contracts. The Court approved the settlement reached in mediation proceedings between the Financial Ombudsman and Ergo Hestia.
May 2021 – Generali TU S.A. introduces a change in the wording of the general terms and conditions of Auto-Casco insurance as postulated by the Financial Ombudsman.
August 2020 – The Financial Ombudsman called on four leading insurers – which together hold more than 50 per cent of the motor insurance market – to stop using unfair market practices. (go to the Communication on this issue)
September 2020 – The Financial Ombudsman sent a further nine summonses to stop unfair market practices in the settlement of motor AC claims. In this way, the Ombudsman’s activities covered all the major players in this segment. (go to the Communication on this issue)
December 2020 – The Financial Ombudsman filed the first unfair practice lawsuit against Auto Casco holders against one of the insurance companies (go to Information on this issue).
Thanks to an emergency complaint of the Financial Ombudsman, a woman with a loan in Swiss francs will not lose the roof over her head
17 November 2021
The Financial Ombudsman filed an extraordinary complaint to the Supreme Court against the judgement issued in the case of a woman with a loan in Swiss francs. The District Court in Wrocław, which examined the case, failed to notice the abusiveness of the provisions of the loan agreement, and therefore – according to the Financial Ombudsman – did not assess it properly. Based on the court’s decision, the woman could lose the roof over her head as a result of bailiff enforcement, so the Financial Ombudsman also filed an application to suspend the enforcement of the judgement, which had already been granted by the court.
The Financial Ombudsman was approached by an applicant who, together with her husband, had entered into a mortgage loan agreement in 2005 with a term of 300 months. The amount of the liability was set at nearly PLN 92 thousand. Unfortunately, at some point the borrowers were unable to make timely payments. The bank terminated the loan agreement. It then filed a lawsuit demanding immediate payment of over PLN 110 thousand. This was a much higher amount than the customers borrowed, due to the mechanism of indexation of the loan amount to CHF.
A co-borrower, who was obligated to repay the loan along with the applicant, died after service of the lawsuit. This resulted in her becoming the sole person responsible for repaying the debt to the bank. The Regional Court in Wrocław allowed the claim in its entirety, recognizing the bank’s claims as legitimate. The defendant was not represented by a professional attorney at this stage, and did not itself appeal the judgement. Thus, the court’s decision became final. The Borrower is therefore liable to pay the full amount claimed and the Bank is pursuing enforcement against her property pursuant to this judgement.
– In my opinion, the court’s ruling contradicts the principles of a democratic state of law. There was a gross error of law in the case, as a result of which the court hearing the case did not provide the applicant with sufficient protection to the consumer, points out Prof. Dr. Habil. Mariusz Golecki, the Financial Ombudsman.
The Financial Ombudsman, in order to secure the applicant’s interests, made an application to suspend the execution of the judgement. The court granted the motion, which in practice means that enforcement against the applicant’s assets cannot proceed until the Supreme Court resolves the extraordinary complaint.
In the view of the Financial Ombudsman, conversion clauses referring to exchange rate tables determined unilaterally by the bank, without indicating objective criteria, are non-transparent, leave room for arbitrary action by the bank and thus burden the borrower with unpredictable risk and violate the equality of parties. They therefore grossly infringe consumer interests and are contrary to good practice.
– In the present case, the court was obliged to examine ex officio whether the relevant contractual provisions violated the law. Unfortunately, it did not do so, which infringed the applicant’s interests, explains Krzysztof Witkowski, attorney-at-law at the Financial Ombudsman Office.
If the court agrees with the Financial Ombudsman’s standpoint, it will dismiss the bank’s claim or overturn the contested judgement. The applicant will then be given a chance to go to trial, during which the court will assess the loan agreement for abusive clauses and the consequences thereof.
It is worth noting that the Financial Ombudsman’s action in this particular case may have an impact on other consumers. Persons in a similar situation will have a chance to change final decisions by means of an extraordinary complaint.
Important! When to file a request for an extraordinary complaint to the Financial Ombudsman?
Requests to the Financial Ombudsman to lodge an extraordinary complaint may relate to decisions ending proceedings in a case which became final after 3 April 2018. Only the Attorney General and the Ombudsman have the power to make an extraordinary complaint in respect of cases decided before that date.
It is worth emphasizing that the extraordinary complaint is intended to apply to truly exceptional situations. One of three prerequisites must be present:
- the judgement violates the principles or human and civil liberties and rights set forth in the Constitution of the Republic of Poland;
- the judgement grossly violates the law by being misinterpreted or misapplied;
- there is a clear contradiction between significant findings of the court and the content of evidence gathered in the case.
In addition, the filing of an extraordinary complaint will also be allowed only if the contested decision cannot be changed or reversed by other extraordinary means of appeal. Moreover, the extraordinary complaint may not be based on allegations that were the subject of the cassation complaint or cassation examined by the Supreme Court. In addition, an extraordinary complaint may be brought only once against the same judgement in the interests of the same party.
In order for the Financial Ombudsman to be able to prepare an extraordinary complaint, it is essential that he is provided with as complete a record of the case as possible. That means the applicant must describe the objections to the judgement, present the pleadings, the judgements of both courts with reasons, and the evidence. Only on this basis can the Financial Ombudsman decide to apply to the Supreme Court. Ideally, such a motion should be prepared by a professional attorney who already knows the case and has handled it in previous instances. He will also know best which prerequisites for filing an extraordinary complaint are met in a given case. Of course, this is not a formal requirement. If someone cannot afford to engage an attorney, the Financial Ombudsman’s lawyers will perform such an analysis based on the documentation provided.
The final judgement in the “Alicja” loan case
9 November 2021
The Court of Appeal in Szczecin accepted the borrowers’ appeal and issued a final judgement concerning a PLN loan agreement. According to the court, the agreement concluded with PKO BP, under which the borrowers were granted the “Alicja” loan, is invalid in its entirety, and the bank must return the payments made in excess of the loan principal amount. The Financial Ombudsman joined this case at the request of the assigned ex officio attorney for one of the claimants. In the course of the proceedings the Financial Ombudsman presented, among other things, arguments concerning the abusiveness of many provisions of the agreement and, consequently, the invalidity of the entire contract.
In 1997, the claimants borrowed PLN 90 thousand from the bank. After 19 years of repayment of instalments totalling to PLN 206 thousand, they still had to repay the entire principal amount (PLN 90 thousand) and additionally capitalised interest (PLN 120 thousand). Thus, the total cost of the loan amounted to over PLN 400 thousand, which is over four times more than the value of the loan itself.
The loan taken out by the claimants was offered by PKO BP bank under the trade name “Alicja”. Through the mechanism of low-interest-only instalments, it was supposed in theory to facilitate the financing of housing goals in the inflationary conditions of the 1990s. In practice, unpaid interest was added to the capital, which – according to the Financial Ombudsman – in many cases made it impossible to repay the debt to the bank.
– The contractual method of determining the amount of credit instalments means that customers, despite regular payments under the agreement, still have no prospect of repaying the loan in full. What is important is that the court declared the agreement invalid, sharing our argument that the provisions therein are not only extremely unfavourable to consumers, but also illegal. This judgement creates an opportunity for other holders of this loan to assert their rights, says Prof. Dr. Habil. Mariusz Golecki, the Financial Ombudsman.
Furthermore, in the opinion of the Financial Ombudsman Office experts, the mechanism used by the bank to calculate the interest rate for the Alicja loan is so imprecise, unclear and unverifiable for borrowers that it raises far-reaching doubts as to its compliance with the law. It also creates the risk of the bank applying an arbitrary interest rate, which directly affects the amount of the repaid loan instalment.
– Reservations were aroused, among other things, by the provision stipulating the method of setting the loan interest rate, which was to depend on the interest rates on 12-month term savings deposits quoted by the head offices of domestic banks having the largest amounts of term liabilities to customers in Poland. However, in the agreement there is no detailed and verifiable for the consumer information on how the lender determines which banks and on what basis are taken into account in this mechanism. Thus, not only was the claimant insufficiently informed about the product he was using, but also the bank could unilaterally determine its parameters during the term of the agreement – explains Krzysztof Witkowski, attorney-at-law at the Financial Ombudsman Office.
The final judgement of the Court of Appeal in Szczecin means that borrowers no longer have to repay the “Alicja” loan. Furthermore, the bank must reimburse one of the borrowers the corresponding amount of payments made in excess of the loan principal amount plus accrued interest.
It is worth noting that the Financial Ombudsman has already supported holders of such loans in court disputes. In some cases, at the request of clients, he issued what he called a “substantial opinion” in the case. This is a legal instrument which consists in the Financial Ombudsman providing an opinion on legal issues which are the subject of a specific court dispute. The Financial Ombudsman then does not join the case and does not become a participant, but only expresses his legal opinion and submits it to the court.
Even greater influence on a favourable outcome of the case is given by the Financial Ombudsman joining a specific court case. In this case, the Financial Ombudsman becomes an active participant in the dispute with specific rights and obligations. The Financial Ombudsman may file pleadings, may appear at any hearing, and may actively participate and speak.
The Financial Ombudsman also supports clients of financial institutions by allowing them to appeal court judgements, conducting conciliation proceedings and providing support during court proceedings.
The insurer undercompensated the farmer. The Financial Ombudsman files an extraordinary complaint.
8 November 2021
A southern farmer’s family lost their home and one of their outbuildings in a storm and resulting fire in July 2016. The insurer deducted the wear and tear of the buildings twice – first when entering into the insurance contract and then when calculating the amount of the loss. In this way, according to the Financial Ombudsman, he understated the payment due. The Courts deciding in this case have shared the insurer’s view. The Financial Ombudsman files an extraordinary complaint.
The case concerns a storm fire at buildings forming part of a farm run by a farmer in southern Poland. The event took place in July 2016. As a result, two of three buildings on the farm were destroyed. Among them was an outbuilding from the 1980s and the only residential building from the 1920s. The owner of the farm had a valid insurance for all buildings, so he hoped for a fair, contractually compliant compensation payment.
However, the insurer, in determining the amount of the loss, again deducted the degree of wear and tear on the buildings, which led to a situation of double estimation of value. In fact, the first deduction occurred when the insurance premium was calculated and the contract was entered into. As a result of the application of such a mechanism of damage calculation, the injured farmer, instead of nearly PLN 80 thousand of compensation, received from the insurer only slightly more than half of that sum. Since the insurer insisted, the farmer decided to pursue his rights in court.
The courts deciding this case agreed with the insurer, stating that taking into account the degree of wear and tear of the building at the stage of determining the extent of the loss allows the extent of the damage suffered to be determined in accordance with the actual state of affairs.
The Financial Ombudsman, after examining the case files, decided to file an extraordinary complaint, bearing in mind the need to provide protection to an insured who had not been paid full compensation as a result of damage to buildings forming part of an agricultural holding.
– If the method of calculating the amount of damage presented in the judgements which form the basis of the present appeal were to be applied, which consists in deducting again from the amount of damage the degree of wear and tear of the buildings, it would lead to a situation of double estimation of value, and as a consequence it would lead to an understatement of the compensation due, which by its nature is supposed to fulfil the compensatory function – observes Prof. Dr. Habil. Mariusz Golecki, the Financial Ombudsman.
In the view of the Financial Ombudsman, the judgement of the Regional Court is in conflict with the provisions of law applicable to the contractual relationship between the parties to the dispute, thus a breach of Article 2 in conjunction with Article 7 and Article 32 of the Constitution was alleged. The content of one of the indicated norms, namely Article 7 of the Constitution requires the authorities to act on the basis and within the limits of the law. This gives rise to a legitimate expectation on the part of the citizen that the public authority, including the court issuing the judgement, will correctly apply the law. Article 2 of the Constitution, on the other hand, establishes the principle of a state of law implementing the principles of social justice.
– This principle is directly related to the principle of legal security and social justice, which should effectively protect people’s welfare and interests – adds Mariusz Golecki.
In the view of the Financial Ombudsman, the judgement issued by the Regional Court, taking into account the reduction of compensation by double application of technical wear and tear, deprived the Insured of the compensation due to him and, consequently, deprived him of the possibility to run his agricultural holding in an undisturbed manner.
The Financial Ombudsman requested that the contested judgement of the Regional Court be reversed and that a decision be made on the merits of the case in accordance with the lawsuit.
Extraordinary appeal against an order for payment on a promissory note
28 October 2021
The Financial Ombudsman submitted to the Supreme Court an extraordinary complaint against a final order for payment in injunction proceedings issued by the Regional Court in Legnica. The Regional Court in Legnica granted the Financial Ombudsman’s motion to suspend the execution of the payment order until the extraordinary complaint is examined.
The court issued a payment order relying solely on the promissory note presented by the bank. However, it failed to note that the case was a consumer one and chose not to examine the loan agreement, which may have contained abusive provisions. Both spouses X, who took more than CHF 30 thousand loan, after 13 years of repayment were ordered by the court to jointly and severally repay the bank almost CHF 25 thousand. The Financial Ombudsman requested that the contested judgement be reversed and the case be referred back for reconsideration and that enforcement proceedings be suspended.
In 2005 Mr and Mrs X took out a loan in order to finance, among other things, the extension and furnishing of their home, from EFG Eurobank Ergasias S.A. Branch in Poland, with its registered office in Warsaw. Due to fortuitous circumstances, after several years of repayment, the spouses were unable to settle further obligations. The loan was secured by a promissory note and the bank decided to assert its claims based on that document. The case was brought by the legal successor of the lender, Raiffeisen Bank International AG (Spółka Akcyjna) Branch in Poland. The Regional Court in Legnica, when considering this case, did not decide to examine the loan agreement, which was not even in the file. The clients have to repay jointly and severally almost CHF 25 thousand.
The Financial Ombudsman, having regard to the interpretation of Article 76 of the Constitution of the Republic of Poland in conjunction with the interpretation of Directive 93/13/EEC provided by the CJEU in case C-176/17, alleged that the Regional Court in Legnica before which the promissory note proceedings were brought, in addition to the provisions of the Civil Procedure Code, failed to take account of provisions aimed at protecting consumers.
The Financial Ombudsman pointed out that if a national court had doubts as to the legitimacy of a claim based on a promissory note, it should, ex officio, ascertain whether there were no unfair terms in the agreement, which it failed to do in this case, especially as the bank’s claim arose from a mortgage loan agreement linked to the CHF currency. Such action by the court in the present case violated the principles of consumer protection under Article 76 of the Constitution of the Republic of Poland.
The need to ensure effective consumer protection as provided by EU regulations means that irrespective of whether court injunction proceedings are initiated on the basis of a promissory note, the court is obliged to verify ex officio whether the promissory note constituted security for a consumer contract, and this requires knowledge of the basis for issuing the note.
In the opinion of Prof. Dr. Habil. Mariusz Golecki, the Financial Ombudsman, the judgement is contrary to the current line of jurisprudence, both domestic and presented by the CJEU. – Assuming that examination of a loan agreement is possible only in the event of a statement of opposition to an order for payment would make it excessively difficult for consumers to avail themselves of the legal protection afforded to them by Community law and would not attain the objective of consumer law, which is to place the parties to a consumer contract on an equal footing. In practice, therefore, applying the provisions of the Civil Procedure Code and interpreting them in the light of the CJEU jurisprudence, the court was obliged to refer the case to ordinary proceedings if the defendant is a natural person who, in the light of the lawsuit or evidence attached thereto, should be deemed a consumer, the Financial Ombudsman explained.
Having familiarised himself with the case file, the Financial Ombudsman decided to lodge an extraordinary complaint and requested that the contested judgement be reversed and the case be referred back for reconsideration. In view of the pending enforcement proceedings, he requested that execution of the contested decision be stayed pending the outcome of the extraordinary appeal proceedings. The Regional Court in Legnica accepted the Ombudsman’s motion and decided to suspend the execution of the final order for payment until the extraordinary complaint of the Financial Ombudsman was examined.
The Court secures the Financial Ombudsman’s claim in case involving “roll-over” loans
19 October 2021
KIM Finance Sp. z o.o. seated in Warsaw may not charge consumers any fees or commissions related to loan refinancing in excess of the limit set forth in the Consumer Credit Law, taking into account the limits provided for in Articles 36b and 36c of the Law. This is the effect of the decision of the District Court Warszawa-Śródmieście issued at the request of the Financial Ombudsman in case ref. no. I Co 1692/21.
On 4 August 2021, the Financial Ombudsman made a direct request to KIM Finance to stop the breaches. This company was involved in the process of ‘rolling over” the loan using a network of related companies. As a result, customers were charged in excess of the statutory limits. The Financial Ombudsman assessed this practice as reprehensible and highly harmful to consumers.
In connection with the company’s failure to change its practice, the Financial Ombudsman requested the District Court for Warsaw-Śródmieście in Warsaw to secure the claim for discontinuation of an unfair market practice against KIM Finance Sp. z o.o. with its registered office in Warsaw by way of a motion of 20 September 2021.
In practice, the court’s decision means that the company may not, in new agreements aimed at “refinancing” loans, include provisions concerning costs in excess of the statutory limits, while in current agreements it may not charge costs and fees in the amount specified in the agreement.
The Financial Ombudsman recalls that “rolling over” a loan consists of granting another loan to a consumer where the entire amount is used to repay a debt granted by another creditor. In such cases, the “new” creditor repays the capital and the costs imposed on the consumer. The problem is that the “new” contract comes with further costs, usually called “refinancing” or “contract extension” fees.
– In this way, the consumer falls into a debt spiral, where the amount to be paid keeps growing and the client is obliged to pay additional fees and further interest, because successive agreements are refinanced all the time – describes Dr. Habil. Mariusz Golecki, the Financial Ombudsman.
In the end, it turns out that from the initially relatively low amount of the loan, the consumer is obliged to return an amount even several times higher. In the view of the Financial Ombudsman, this constitutes a circumvention of the provisions of Articles 36a and 36c of the Consumer Credit Law concerning maximum limits on non-interest credit costs. Such behaviour by some creditors may also be misleading and distort the average consumer’s market behaviour.
– Customer complaints to the Financial Ombudsman show that most often the lenders and credit intermediaries are linked by e.g. capital, personal links or conduct business activity within the same Internet platform, which allows for artificial creation of a sales network – says Paulina Tronowska, attorney-at-law at the Financial Ombudsman Office.
As a result of the search of conducted cases, the Financial Ombudsman found that KIM Finance granted loans in which the credit intermediary was Creamfinance Poland Sp. z o.o., while the loans themselves were granted via online platforms “Lendon.pl” and “Extraportfel.pl”. Importantly, the consumer loans were granted to refinance loans concluded through these platforms by other lenders who were also subsidiaries of the credit intermediary, Creamfinance Poland Sp. z o.o.
– We consider the practice described above as reprehensible and highly harmful to consumers. I am glad that the Court shared the Financial Ombudsman’s arguments about the unfair nature of such actions. – says Mariusz Golecki.
In this case, the Financial Ombudsman, acting pursuant to his powers under the Law on Counteracting Unfair Market Practices, acts on his own behalf to protect the interests of all clients of financial market entities. The Law in question empowers the Financial Ombudsman to demand the cessation of an unfair practice, to make a statement of a specified content and form or to pay a sum of money to a social cause.
The Financial Ombudsman has joined another CHF case
8 October 2021
At the request of the claimant – consumer, the Financial Ombudsman joined the case conducted before the District Court for Warsaw-Śródmieście under case file no. I C 1297/21.
The Financial Ombudsman sent a pleading to the District Court for Warsaw-Śródmieście in Warsaw concerning joining the case under case file no. I C 1297/21, an action brought by the borrower against the bank for remuneration for the use of capital, together with a reference for a preliminary ruling from the Court considering the case.
A question referred to the Court of Justice of the European Union concerns a situation in which a credit agreement concluded by a bank and a consumer is void from the outset because it contains unfair contractual terms.
The Court asked the CJEU whether Articles 6(1) and 7(1) of Council Directive 93/13/EEC and the principles of effectiveness, legal certainty and proportionality must be interpreted as precluding a judicial interpretation of national legislation under which the parties, in addition to reimbursement of the money paid in performance of the contract (the bank – the principal of the credit, the consumer – the instalments, fees, commissions and insurance premiums), and statutory default interest from the time of the demand for payment, may claim any other performance.
The referring court proposes that this question should be answered in the negative, i.e. that the interpretation of the abovementioned provisions and the principles of effectiveness, legal certainty and proportionality preclude an interpretation of the national legislation which provides that the parties to a credit agreement are entitled to any benefits other than those referred to above.
The Financial Ombudsman has consistently taken the position that banks are not entitled to so-called remuneration for capital, which the Financial Ombudsman has repeatedly expressed by presenting its views in defence of clients sued by banks in court proceedings, including by presenting its position to the Court of Justice of the European Union, as well as by presenting the justification of its position to the Supreme Court.
Settlement between the Financial Ombudsman and InterRisk
4 October 2021
The Financial Ombudsman informs that on 24 September 2021 a settlement was concluded between the Financial Ombudsman and InterRisk before the Regional Court in Warsaw, under which the Insurer will amend the content of the General Conditions of Auto+ Package insurance, as postulated by the Financial Ombudsman, approved by Resolution no. 04/25/06/2019 of the Management Board of InterRisk. Establishing a new content of the definition of total damage results in the introduction of uniform principles of damage qualification and its amount calculation – with reference to both total damage and partial damage.
Detailed information on this subject has been posted on the InterRisk website (News sub-site). The amended General Conditions of Auto+ Package insurance will be published on InterRisk’s website (the sub-site concerning motor insurance) by 15 October 2021 at the latest. The settlement, negotiated in an atmosphere of mutual concern for the good of the clients and mutual understanding of the parties’ positions, was concluded in the best interests of the Insured and those seeking insurance protection.
The Financial Ombudsman intervenes in the case of unauthorized transactions
23 September 2021
The Financial Ombudsman is increasingly intervening in the case of loss of funds by bank customers as a result of unauthorized transactions. Victims often associate this fact with a telephone conversation with a person claiming to be a bank employee. Not only do customers lose the money in their accounts, but they also have to pay back loans and credits that they never took out. The Financial Ombudsman’s estimates, based on data from the National Bank of Poland (NBP), suggest that there may be as many as 250 thousand such offences this year.
According to NBP information, the average amount of funds lost as a result of unauthorized payment transactions is about 300 PLN. However, there are cases when customers report crimes for amounts much higher than PLN 100 thousand.
– In the first half of this year alone, we accepted approximately 700 reports of unauthorized transactions. That is not much, considering the scale of the phenomenon. However, the Financial Ombudsman receives mainly the most serious cases, connected with large sums of money and long-term, high loan liabilities – says Prof. Mariusz Golecki, the Financial Ombudsman.
In recent days, the Financial Ombudsman has made claims on behalf of clients in cases involving the loss of large funds as a result of unauthorized transactions. The cases concern a senior citizen who lost more than PLN 160 thousand and a client representing the younger generation who actively uses technology on a daily basis, and who declared a loss of over PLN 140 thousand
According to the explanations provided by the senior customer, after all his savings accumulated on the account had been withdrawn as a result of unauthorized transactions, the criminals led the bank to withdraw the amounts of two loans under alleged agreements concluded through the Internet banking system.
The customer claims that he did not apply for any loan or take any action leading to a loan agreement or transaction authorization. Immediately upon discovering the incident, the customer reported the suspected crime to law enforcement and handed over his phone to them to see if it had been infected with malware. The police found no irregularities regarding the phone.
The customer also filed a complaint with the bank, seeking a refund of the lost funds and a waiver by the bank of claims related to the alleged loan agreements. Despite the passage of several months, the client has not received a refund of the lost funds and the bank has not recognized the loan agreements as non-existent.
The second case involves a client from a younger generation who actively uses technology and e-banking solutions. The customer associates the loss of nearly PLN 140 thousand with a telephone conversation with a person calling from the bank’s official helpline and claiming to be its employee. A third party withdrew all savings from the client’s account, and additionally led the bank to withdraw the amount of the alleged loans.
The customer immediately filed a complaint with the bank regarding the unauthorized payment transactions and notified law enforcement authorities. Nevertheless, the customer was not reimbursed for the transaction amounts, and the bank began collecting instalments of the loans paid to the perpetrators of the deed.
In both cases, the Financial Ombudsman requested the banks to pay for the unauthorized transactions and to declare the loan agreements non-existent. The value of claims in the case of a senior citizen is over PLN 160 thousand, in the case of the female client – PLN 140 thousand.
The Financial Ombudsman emphasizes that the problem of unauthorized transactions and loan and credit disbursements by unauthorized persons also concerns young people who are perfectly familiar with new technologies.
– The tools of the fraudsters are becoming more sophisticated. Criminals use social engineering, often putting very high pressure on the victim. They use the possibilities offered by modern technology, make their actions credible and often force their victims to behave in a certain way. Any of us can become a victim of this type of crime. All it takes is for a criminal to hit on our worse day and less vigilance. That is why I once again appeal that if you receive a call from a person claiming to be a bank employee, you should ask the caller for their name and position, hang up and call the bank yourself to verify the information given, encourages the Financial Ombudsman.
The information is not a source of law but is the result of an analysis of individual factual situations carried out by the Financial Ombudsman as part of the protection of clients of financial market entities.
“The voice of European consumers should be heard better” – Prof. Mariusz Golecki at the 13th European Economic Congress
21 September 2021
Does EU law help protect consumers in international and domestic markets? Which consumer protection tools and models are most effective in each country? These questions were answered by guests of the Financial Ombudsman during a debate devoted to consumer protection in the European financial market. The interlocutors were unanimous – the appointment of a European financial ombudsman to represent consumers’ interests at European Union level should be considered.
“Consumer protection in a global context, particularly in relation to consumer relations within the European Union, is extremely important, as every consumer, regardless of where they live, should have the same opportunities to assert their rights. A Financial Ombudsman Office at European Union level would increase customer safety,” said Financial Ombudsman, Prof. Mariusz Golecki, emphasising the need for discussions at the supranational level, involving international experts.
The panel organised by the Financial Ombudsman during the 13th European Economic Congress was participated by international guests: Prof. Mateja Durovic from the King’s College London, Member of the Board of the International Association of Consumer Law, Prof. Marta Infantino from the Faculty of Law at the University of Trieste, Aleksandra Mączyńska, Executive Director of Better Finance, Prof. Cristina Poncibo from the Department of Law at the University of Turin, Prof. Mariola Lemonnier from the Department of Financial Law, Faculty of Law and Administration at the University of Warmia and Mazury in Olsztyn and Prof. Piotr Tereszkiewicz from the Department of Civil Law, Faculty of Law and Administration at the Jagiellonian University.
The participants discussed the most pressing issues related to customer protection in the financial market, including the still current topic of so-called Swiss franc loans.
“The case of loans denominated and indexed to the franc shows considerable inequalities in the treatment of consumers in the financial market across countries. The problem of Swiss franc loans concerns not only Poland, but the entire region. We need greater efficiency and actions that will influence effective solutions. Perhaps the solution is wider access to dispute resolution, not only at the court level,” noted Golecki, referring to the situation of consumers in other countries.
The debate also raised a number of issues relating to the need for cross-border protection of consumer rights. The panel participants presented national perspectives and pointed out how the legislation of individual countries looks in the light of the new EU consumer policy. One of the topics discussed was ensuring consumer safety in cyberspace.
“The European Union aims to put consumer protection online at the same level as for traditional financial services. As shown by the experience of the COVID-19 pandemic, when a whole range of activities of consumers, but also of the financial sector – banks, insurers – were transferred to cyberspace. Communication between consumers and financial market operators was exclusively digital. This experience makes it clear that effective law enforcement and the possibilities of redress for consumers should be a key element. It is also worth noting the necessity of financial education, which should be treated as a pan-European priority,” stressed Prof. Mariusz Golecki, Financial Ombudsman, in the discussion.
The development of technology is treated as quite a challenge because the asymmetry between the individual consumer and cybercriminals is huge.
“While we are still struggling with the implementation of PSD II, from today’s perspective we know that it is not enough, technology is ahead of legislation. The regulation of payment services must not just be a so-called regulatory sandbox. Because payment services are based on the functioning of many business models, from simple bank transfers to complex operations related to optimisation of personal finance management, namely fintech solutions,” added Golecki.
The panel participants agreed that it would be advisable to adopt the “twin peaks” model in the European Union. This would involve setting up two bodies at EU level: one specialised in prudential supervision of market institutions and one responsible for conduct of business supervision and consumer protection.
An alternative to such a solution could be enhanced cooperation between the financial ombudsmen from individual Member States. According to Prof. Mariusz Golecki, the problem is, however, different models of consumer protection adopted in EU countries. In the opinion of Prof. Golecki, it could also be problematic to achieve sufficiently intensive cooperation between ombudsmen to meet the challenges arising, for example, from the development of new technologies and cross-border problems.
“We are talking about adopting general systemic solutions, either increasing the coordination of these ombudsmen’s activities, introducing a more uniform, more effective model in individual Member States, or introducing a single body at the European Union level, which would be a financial ombudsman,” explained Prof. Golecki.
According to him, the appointment of a financial ombudsman in the EU would contribute to making “the voice of consumers in the financial market heard better”, also in Brussels or Luxembourg.
“It would certainly be useful in the near term, it would improve the quality of financial services, but also the protection and security in this market. The appointment of a European financial ombudsman
would also improve the exchange of information and contribute to increased financial education activities. Technology knows no boundaries and we have to learn from it,” said Prof. Golecki.
The Executive Director of BETTER FINANCE, Aleksandra Mączyńska, is of a similar opinion. “We see no compelling reason why a body dealing with and specialising in consumer protection in the financial market should not be set up at EU level,” she stressed.
Mączyńska noted that currently we have three European supervisory authorities dealing with financial/banking products, stock exchanges and securities, and insurance and occupational pension schemes (EBA, ESMA and EIOPA).
“These authorities also have consumer protection tasks within their remit, but because of their many other tasks, they do not really have the time or the resources to devote to consumer issues as much as we would like. I am convinced that ultimately the +twin peaks+ model would provide more effective consumer protection,” concluded the representative of BETTER FINANCE.
Recording of the debate:
“We are all consumers in the financial market” – the Financial Ombudsman at the XXX Economic Forum in Karpacz
16 September 2021
All consumers in the European Union, regardless of where they live, should have the guarantee of the same level of their rights’ protection, unfortunately, practice shows huge inequalities in this area. Therefore, the Financial Ombudsman, a partner of the XXX Economic Forum in Karpacz, invited international experts to discuss customer protection on the European financial market.
The most important issues discussed included those related to loans in Swiss francs, unauthorized payment transactions and consumer interests in general.
“We are dealing with the cross-border nature of consumer protection issues on the financial market in relation to both banking services, the capital and insurance markets and technology. The development of technology forces cooperation between entities in different countries, not only in the European Union, but also more broadly at the international level”, noted prof. Mariusz J. Golecki, Financial Ombudsman, explaining the need for extensive dialogue with experts from various countries.
The debates organized by the Financial Ombudsman were attended by, among others: Ger Deering, Financial Ombudsman of Ireland, prof. Teresa Rodriguez de les Heras Ballell of Charles III University of Madrid, Csaba Kandrács, Ph.D., Vice-President of the Central Bank of Hungary, prof. Laszlo Kiss of the National University of Public Service, András Pomeisl, Ph.D., of the Pázmány Péter Catholic University, prof. Christophe Paulin of the University of Toulouse, prof. Jacek Jastrzębski, Chairperson the Polish Financial Supervision Authority, prof. Piotr Tereszkiewicz of the Jagiellonian University, prof. Mariola Lemonnier, prof. Jakub Szczerbowski, Director of the Banking and Capital Market Client Department of the Financial Ombudsman and Financial Ombudsman, prof. Mariusz J. Golecki.
In defence of the financial market consumer
The debate focused on consumer protection issues in the context of financial products and services. Considerable attention was paid to the contemporary challenges of EU consumer law in the light of the European Parliament and Council (EU) Regulation.
The subject of loans denominated and indexed to foreign currencies was also discussed. Mariusz Golecki, Financial Ombudsman, pointed out that the biggest problems with Swiss franc loans occurred in Central Europe, but as the example of Spain shows, consumers in the so-called old EU countries also face problems with denominated loans.
– The same financial products have different numbers of abusive clauses in different countries. “The World Bank indicated that the same product from the same bank was much more toxic in Hungary than in Austria. There are also different attempts to solve this problem – in Hungary there were attempts at a statutory solution and conversion. We skipped this stage in Poland.” – says the Financial Ombudsman.
The discussion on unauthorized transactions aroused a lot of emotion, especially since anyone can become a victim of cybercriminals, regardless of geographical latitude. – Unauthorized transactions are currently one of the biggest risks associated with the so-called electronic banking. The development and availability of technology, and more recently the COVID-19 outbreak, have compounded the increase in criminal activity resulting in the theft of funds from bank accounts. We are approached by victims who in this way have sometimes lost their entire life savings – emphasized Mariusz Golecki during the debate.
Opportunities for transnational partnerships
XXX Economic Forum was also an excellent opportunity to strengthen cooperation between the Polish Financial Ombudsmen – prof. Mr Mariusz Golecki and Mr Ger Deering of Ireland pledged joint action to strengthen consumer protection on financial markets in both countries.
– It is important for us that both Poles and Irish people can move freely between countries. In Ireland as in Poland, and indeed across Europe, there are more and more pitfalls for customers of financial institutions. Insurance and loan agreements are complicated, with more and more provisions in the small print that can get customers into trouble for years to come – said Ger Deering. The Financial Ombudsman of Ireland also drew attention to the need to enforce the right to an Irish pension for Poles returning to their homeland after several years of work in Ireland.
As Mariusz J. Golecki pointed out, cooperation with the Irish Ombudsman is particularly important for Poland. Ger Deering is the Chairman of the INFO Network, a network of entities and organizations dedicated to resolving disputes between consumers and financial institutions in many global markets.
The Polish Ombudsman has announced that he intends to actively engage in European activities on the FIN-NET forum, in the work of which the Financial Ombudsman of Ireland is also involved
Discussion panels organized by the Financial Ombudsman as part of the XXX Economic Forum in Karpacz:
- Swiss franc loans today and tomorrow in the European context
- Unauthorised transactions as an example of contemporary threats to customer safety in the financial market
- Consumer protection in the financial market from the European perspective
In addition to the panels organized by the Financial Ombudsman, prof. Mariusz J. Golecki also accepted an invitation to participate in a panel as part of the Europe of the Future program, during which the invited guests tried to answer the question “Does liberal capitalism need conservative values?”. The discussion moderated by the MP Paweł Poncyliusz was also attended by Rev. prof. Stanisław Dziekoński, Bartłomiej Wróblewski and Władysław Kosiniak Kamysz.
– Economic freedom and innovation often go hand in hand with far-reaching consumer protection, including on the financial market. It is in highly developed, liberal markets, such as the UK or the US, that the institution of the Financial Ombudsman enjoys great independence and plays an important role in the entire system, especially after the so-called Lehman Brothers crisis in 2008. – said Golecki.
According to Golecki, the creators of the united Europe, such as Konrad Adenauer, Robert Schuman and Joseph Bech, were strictly conservative politicians, for whom freedom was as important as the norms of social coexistence and timeless principles that should guide the European community.
We invite you to watch, a short film summary:
“Freedom and innovation go hand in hand with consumer protection” – prof. Mariusz Golecki at the Forum in Karpacz
10 September 2021
“The European Union was created by prominent conservative politicians such as Robert Schuman, Alcide de Gasperi and Konrad Adenauer. It is worth reminding that it is the conservative values and ideas that constitute the foundation of the united Europe”, said prof. Mariusz Golecki during the Economic Forum in Krynica.
Prof. Mariusz Golecki, Financial Ombudsman, took part in the panel “Does liberal capitalism need conservative values?” which was held on the last day of the Forum. The discussion moderated by MP Paweł Poncyliusz, was also attended by Rev. prof. Stanisław Dziekoński, Bartłomiej Wróblewski and Władysław Kosiniak-Kamysz.
According to Golecki, the creators of the united Europe, such as Konrad Adenauer, Robert Schuman and Alcide de Gasperi, were strictly conservative politicians, for whom freedom was as important as the norms of social coexistence and timeless principles that should guide the European community.
“Economic freedom and innovation often go hand in hand with far-reaching consumer protection, including on the financial market. It is in highly developed, liberal markets, such as the UK or the US, that the institution of Financial Ombudsman enjoys great independence and plays an important role in the entire system, especially after the so-called Lehman Brothers crisis in 2008” – said Golecki.
“It was in the very free, after all, conducive to creativity American market, where Tesla, for example, comes from, that we had the disclosure of the so-called dieselgate, a scandal in which Volkswagen cheated its own customers on a massive scale. This information was provided by the EPA, which is the Environmental Protection Agency, a federal service whose purpose is to advocate for the environment and the health of U.S. citizens” – he added.
Debate: “Consumer protection in the financial market in the European perspective” – Financial Ombudsman at the 30th Economic Forum in Karpacz
9 September 2021
In the European Union, all consumers of financial services should be guaranteed the same level of protection of their rights. In the new EU Consumer Agenda, there is a need to consolidate the protection policy to address the contemporary problems posed by the increasing digitalisation of financial services. During the 30th Economic Forum in Karpacz, the Financial Ombudsman, Prof. Mariusz Golecki, talked about the necessity of international cooperation.
Dr Csaba Kandrács, Deputy Governor of the Central Bank of Hungary, Ger Deering, Financial Ombudsman of Ireland, Prof. Christophe Paulin of the University of Toulouse, Prof. Piotr Tereszkiewicz of the Jagiellonian University and Prof. Mariusz J. Golecki, Financial Ombudsman, discussed within the panel “Consumer protection in the financial market from the European perspective”; the discussion was moderated by Prof. Mariola Lemonnier.
“The starting point should be a reflection on the European Consumer Agenda and the New Deal for Consumers of 2018, which provides for, among other things, specialised consumer protection depending on the specific nature of the market,” emphasised the Financial Ombudsman, Mariusz J. Golecki.
The debate focused on consumer protection issues in the context of financial products and services. Considerable attention was paid to the contemporary challenges of EU consumer law in the light of the European Parliament and Council (EU) Regulation.
The Financial Ombudsman pointed out that, in the interest of consumer welfare, cooperation at international level is necessary:
“We are dealing with the cross-border nature of consumer protection issues in the financial market in relation to both banking services, the capital and insurance markets and technology. The development of technology forces cooperation between entities in different countries, not only in the European Union, but also more broadly at the international level,” noted Mariusz J. Golecki
“In Europe, we have two models of consumer protection in financial services. The first is the Anglo-Saxon one, where we have an independent institution which, to a certain extent, replaces the courts, that is, reduces the number of proceedings – this is very important, because customer disputes with financial institutions are marked by a great deal of asymmetry – but also ensures the speed of proceedings and reduces their number. The second model relates to Hungary – the centralised, integrated model. In Europe we are still moving between the two models and here there is room for discussion as to how much centralisation will work and how much coordination between different institutions is necessary,” he added.
Debate: “Consumer protection in the financial market in the European perspective” was one of three panel discussions organised by the Financial Ombudsman as part of the 30th Economic Forum in Karpacz.
Other discussions concerned the following issues: unauthorised transactions as an example of contemporary threats to customer security in the financial market and Swiss franc loans today and tomorrow in the European context.
Debate: “Unauthorised transactions as an example of contemporary threats to customer security in the financial market” – Financial Ombudsman at the 30th Economic Forum in Karpacz
8 September 2021
Due to the dynamic development of digital banking services, consumers of the financial market are increasingly becoming victims of so-called unauthorised financial transactions, a situation in which money disappears from the account without the consumer’s knowledge. The scale of the problem is still growing, therefore the Financial Ombudsman invited international guests to take a look at this issue as part of a panel during the 30th Economic Forum in Karpacz.
Any consumer who uses electronic banking may fall victim to an unauthorised payment transaction. Digital payments dominate the financial market and are particularly popular in Poland. The Financial Ombudsman receives more and more requests for intervention concerning unauthorised transactions. The growing number of complaints may suggest that not all banks operating on the Polish market have reliably adapted their procedures to the legal state in force since the entry into force of the changes related to the implementation of PSD II – Directive (EU) 2015/2366 of the European Parliament and of the Council of 25 November 2015 on payment services in the internal market amending Directives 2002/65/EC, 2009/110/EC, 2013/36/EU and Regulation (EU) No. 1093/2010 and repealing Directive 2007/64/EC (OJ EU.L.2015.337.35 of 2015.12.23 as amended).
With the development of technology and increasing digitalisation, it is worth ensuring that systemic changes are made to ensure that consumers are properly protected against cybercrime.
– Today’s debate shows that the existing directives are not sufficient; they may need to be extended. We expect to see more and more new ways for criminals to operate as technology evolves. In Q1 2021 alone, more than 60,000 events involving unauthorised transactions were reported, according to a report by the National Bank of Poland. The Financial Ombudsman Office received 700 complaints in the first half of this year, and we expect that there will be as many as 1,500. These are often the most serious cases, where, in addition to emptying the account, a loan is taken out – says the Financial Ombudsman, Mariusz J. Golecki, Ph.D.
With the increase in number of digital payments, protection against unauthorised transactions has become one of the main concerns for the safety of customers of financial market operators. The situation of consumers in EU countries was discussed by Ger Deerig, Ombudsman for Financial Services and Pensions in Ireland, dr. Johannes Meier from the University of Magburg, dr. Denisa Jindrichova representing the Czech National Bank, dr. Csaba Kandrács, Deputy Governor of the Central Bank of Hungary and the Financial Ombudsman Mariusz J. Golecki, Ph.D., prof. of the University of Łódź The meeting was chaired by Jakub Szczerbowski, Ph.D., prof. of the University of Łódź, Director of the Banking and Capital Market Customer Department.
The discussion allowed for an exchange of experience and views on the issue of unauthorised transactions. The panelists focused on the possibilities to prevent and counteract unauthorised transactions, court practice related to the occurrence of unauthorised transactions, functioning of state authorities other than courts competent to protect against unauthorised transactions.
“Unauthorised transactions as an example of contemporary threats to customer security in the financial market” are, together with the debate “Franc loans today and tomorrow in the European context”, discussions organised as part of the XXX Economic Forum in Karpacz.
Another discussion with international guests will take place tomorrow. This time the Financial Ombudsman will devote the debate to the issue:
Consumer protection in the financial market in the European perspective (9 September of this year, 1:20 p.m. – 2:20 p.m.).
The event will be streamed directly on the Financial Ombudsman’s Facebook profile.
International Cooperation of Financial Ombudsmen
8 September 2021
Economic Forum in Karpacz: International cooperation is essential to protect financial market customers.
The Financial Ombudsmen for Ireland and Poland, Mr Ger Deering and prof. Mariusz Golecki declared their cooperation to strengthen consumer protection in the financial market.
– The specialised office of the Financial Ombudsman plays a significant role, which is to protect the legally weaker participants in the financial market. In Ireland as in Poland, and indeed across Europe, there are more and more pitfalls for customers of financial institutions. Insurance and credit agreements are complicated, with more and more provisions in the small print that can get customers into trouble for years to come – said Gerd Deering, Ireland’s Financial Ombudsman. – We have to solve many problems which have accumulated over the years – declares the guest of the 30th Economic Forum in Karpacz.
– Ireland has a very strong track record in protecting non-professional financial market participants. The Financial Ombudsman has adequate tools to protect customers effectively – admits prof. Mariusz Golecki, Financial Ombudsman in Poland. – Our cooperation will be multidimensional, as many of our compatriots live in Ireland and often turn to the Financial Ombudsman there with requests for help.
The Financial Ombudsman is a partner of the 30th Economic Forum in Karpacz, where he organises the following debates devoted to the place of the consumer in the financial market.
Franc loans today and tomorrow in the European context – 7.09.2021, 2:30 p.m. – 3:30 p.m.
Unauthorised transactions as an example of contemporary threats to customer security in the financial market – 8 September of this year, 1:20 p.m. – 2:20 p.m.
Consumer protection in the financial market in the European perspective – 9 September of this year, 1:20 p.m. – 2:20 p.m.
“Swiss franc loans today and tomorrow in the European context” debate – Financial Ombudsman at the XXX Economic Forum in Karpacz
07 September 2021
“Swiss franc loans today and tomorrow in the European context” debate is the first event organised by the Financial Ombudsman as part of the XXX Economic Forum in Karpacz. The discussion, with the participation of international guests, confirmed the different experiences of the European Union Member States in the area of consumer protection related to loans denominated or indexed to foreign currencies.
All consumers in the European Union, regardless of where they live, should have the guarantee of the same level of their rights’ protection. However, due to the regional optimisation of financial products, the scope of protection in the concluded transactions is different. Considering it crucial to start an international discussion on the place of the consumer in the financial services market, the Financial Ombudsman, a partner of the XXX Economic Forum in Karpacz, invited international guests to a debate on consumer protection in the European financial market.
The panel, in addition to the Financial Ombudsman Mariusz Golecki, PhD (post-doctoral degree), was attended by Professor Teresa Rodriguez de les Heras Ballell of Charles III University of Madrid who presented the situation of consumers in Spain, Professor Laszlo Kiss of the National University of Public Service, András Pomeisl, PhD, of the Pázmány Péter Catholic University, who focused on the Hungarian context, and Professor Jacek Jastrzębski, representing the Polish Financial Supervision Authority. The discussion was moderated by Professor of Legal Sciences Piotr Tereszkiewicz of the Jagiellonian University.
Financial Ombudsman Mariusz Golecki pointed out that the biggest problems with Swiss franc loans occurred in Central Europe, but as the example of Spain shows, consumers in the so-called old EU countries also face problems with denominated loans. Another important aspect is that the same financial products have different numbers of abusive clauses in different countries:
“The World Bank indicated that the same product from the same bank was much more toxic in Hungary than in Austria. There are also different attempts to solve this problem – in Hungary there were attempts at a statutory solution and conversion. We skipped this stage in Poland.”
The Financial Ombudsman pointed out that the Court of Justice of the European Union is shifting a greater adjudicatory role to national courts.
“The rules aren’t clear, I don’t know whether to make a settlement without knowing the law now stands. In Croatia, class actions and the conclusion of agreements with banks as a result of these actions were decisive. But it is also worth thinking about a more transparent alternative dispute resolution system. We can consider the Irish model, where the Financial Ombudsman makes the final decisions on resolving the dispute,” said Golecki.
“Swiss franc loans today and tomorrow in the European context” is not the only debate organised by the Financial Ombudsman.
Discussions to be held on the following days:
Unauthorised transactions as an example of contemporary threats to customer safety in the financial market (8 September this year, 1.20 p.m. – 2.20 p.m.).
Consumer protection in the financial market in the European perspective (9 September this year, 1.20 p.m. – 2.20 p.m.).
You lost money? The Financial Ombudsman will help to recover them
06 September 2021
A customer of a bank or other payment institution who suffers financial loss as a result of fraud has the right to claim reimbursement of the lost amount. in the event of refusal, he or she can use the help of the Financial Ombudsman. This was reminded by a representative of this office as part of a discussion at the Cybersec Forum 2021 conference.
According to prof. Jakub Szczerbowski, Director of the Banking and Capital Market Customer Unit at the Financial Ombudsman’s Office, the Payment Services Act clearly defines these issues. Any customer may demand that banks or other payment institutions return funds that have been stolen from their accounts.
If your complaint is rejected, you can turn to the Financial Ombudsman for help. The Office provides several forms of assistance to customers. The first one is the so-called intervention, i.e. continuation of the complaint procedure.
The Financial Ombudsman is trying to change the institution’s position and, as prof. Szczerbowski emphasized – the effectiveness of this type of action is at the level of 46 percent. Another form of assistance is mediation between the institution and the customer in order to reach a compromise.
In exceptional circumstances, the Financial Ombudsman may also assist in bringing an action before a common court against a financial institution. This is the case when, for example, there is a need to shape a line of case law or the case is unprecedented and the Office involvement will be required.
During the panel devoted to the security of financial customers in the digital world Mateusz Górnisiewicz, Deputy Director of the Cyber Security Department of the Polish Financial Supervision Authority (KNF) reminded about the problem of data phishing, presenting some of the most common scenarios carried out by criminals.
The scam usually takes place in direct contact with the customer, when during a phone conversation the criminal impersonates a bank or payment institution employee. He or she can also encourage the installation of malware to monitor the activity of a customer’s mobile device.
The representative of KNF recommended verifying the legality of operation of a given payment institution on the website of the authority, where registers of regulated or notified entities are kept. There is also a list of entities that potentially threaten the security of customers.
Kamil Giereś, Head of Legal Allegro Pay, presented solutions used by the auction service to protect customers against fraud, mentioning both the verification of sellers as well as the buyer protection program, transaction monitoring and security system with two-factor authentication.
The innovative payment system solution using retinal scanning was described by Krystian Kulczycki, CEO of PayEye. A pilot program with the use of terminals is currently carried out in Wrocław and according to expert studies, provides a high level of security.
A panel on the security of financial customers in the digital world was held as part of the Cybersec Forum conference on September 1-2, 2021 organised in Krynica Górska.
Source: PAP MediaRoom
The Financial Ombudsman presented the Supreme Court with his position on the Swiss franc loans in case no. III CZP 11/21
24 June 2021
In response to the First President of the Supreme Court’s inquiry, the Financial Ombudsman presented his position concerning the directions of resolving legal issues presented by the Civil Chamber of the Supreme Court in cases related to loans indexed and denominated to foreign currency.
“Our position is congruent with the Financial Ombudsman’s views presented hitherto and adds further arguments arising from the latest case-law and legal scholarship,” explains dr hab. Mariusz Golecki, university professor and the Financial Ombudsman. “We consulted with a range of civil and consumer law communities and specialists in preparing our response for the Supreme Court. I would like to assure you that my office will continue to support consumers unreservedly, using all legally available instruments in all types of cases.”
In his position, the Financial Ombudsman recalled the CJEU’s extensive case-law on the protection of borrowers who concluded loan agreements on the basis of models containing unlawful provisions prepared by banks, and the primary aim of introducing EU law provisions on consumer protection. Furthermore, the Financial Ombudsman highlighted that, as a general rule, it is possible to fill a gap in a loan agreement after an unlawful provision is removed by a default rule, but the Financial Ombudsman does not find in Polish law any such a rule that would be applicable in cases of indexed and denominated loans.
The Financial Ombudsman emphasised that if it is impossible to establish a binding exchange rate in an indexed or denominated loan agreement, the agreement may remain in force only if the borrower, who is a consumer, consciously and voluntarily agrees to the continuation of unfair provisions concerning the establishment of such a rate. Moreover, the Financial Ombudsman pointed out that an agreement can be determined invalid for reasons other than the inclusion of unlawful provisions in its content.
The Financial Ombudsman also pointed to the Supreme Court resolution III CZP 6/21, adopted at the request of the Financial Ombudsman, according to which, in the case of invalidity or ineffectiveness of a loan agreement, the so-called theory of two condictions applies. According to this theory, both parties to the agreement have separate claims for the return of gained benefits.
The Financial Ombudsman resolved, in accordance with the case-law of the Supreme Court, that the statute of limitations on the bank’s claim for a refund of amounts paid out under a loan starts to run the moment the loan agreement becomes permanently ineffective. Permanent ineffectiveness occurs in case of a lack of conscious and voluntary consent to an unlawful provision expressed in the consumer’s first statement to the bank, questioning the validity of the agreement or indicating the abusive nature of its provisions.
The Financial Ombudsman clearly addressed the issue of lenders demanding remuneration for the use of funds made available to borrowers by the bank, i.e. the so-called remuneration for capital. In the Ombudsman’s view, such demands are contrary to EU law, i.e. Directive 93/13, and have no basis in national law. Adopting a different position would result in a situation where a bank that uses unlawful provisions would obtain an advantage at the expense of the consumer, instead of suffering the negative consequences of using such provisions.
The Financial Ombudsman expressed similar opinion in a request for a preliminary ruling in a pending case brought by a bank against a consumer. The Financial Ombudsman adopted a position that in consequence of the invalidity of a legal transaction (an agreement for a loan indexed or denominated to foreign currency), the parties are obliged to return their mutual benefits; however, the demand by the bank which is a party to such an agreement, for remuneration for the consumer’s use of the capital obtained under the invalid loan agreement is contrary to both EU law, in particular Directive 93/13, and Polish law.
The Financial Ombudsman is preparing his position for the Supreme Court.
24 May 2021
The Financial Ombudsman started work on his position on the legal issues covered by the motion of the First President of the Supreme Court in case III CZP 11/21.
The press spokesperson of the Supreme Court informed that on May 11, 2021, the composition of the entire Civil Chamber of the Supreme Court considering at a closed session the request of the First President of the Supreme Court of January 29, 2021, to resolve discrepancies in the interpretation of legal provisions in the case law of common courts and the Supreme Court concerning loans indexed and denominated in foreign currencies, decided to inform the Financial Ombudsman about the ongoing proceedings and asked for his position on the legal issues covered by the request of the First President of the Supreme Court.
According to the announcement, the composition of the entire Civil Chamber of the Supreme Court made this decision taking into account the social and economic importance of the issues presented to it for resolution.
The Financial Ombudsman has started work on his position. In the morning, a briefing took place at the Office of the Financial Ombudsman, during which a work plan was defined. In his work, the Financial Ombudsman places particular emphasis on the effects of the proposed solutions on the legal system.
“I have made a decision to review the existing positions,”says dr. hab. Mariusz Jerzy Golecki, professor at the University of Łódź, Financial Ombudsman. “Due to the importance of the issue, I do not exclude a change of position with regard to individual issues, also bearing in mind the latest case law of common courts, the Supreme Court, and the Court of Justice of the European Union.”
The Supreme Court confirms the position of the Financial Ombudsman
7 May 2021
The Supreme Court, at a session of the Civil Chamber composed of 7 members, ruled that in the event of the invalidity of a foreign currency loan agreement, the parties to the dispute should settle accounts according to the theory of two claims [Polish: “teoria dwóch kondykcji”]. The resolution adopted today by the Supreme Court has the force of a legal principle and ensures greater predictability of case law in the so-called Swiss franc matters. The ruling of the Supreme Court is consistent with the position of the Financial Ombudsman, who also applied for the unification of judicial decisions.
– The adopted resolution confirms the trend in jurisprudence that is beneficial for consumers – says dr. hab. Mariusz Jerzy Golecki, professor at the University of Łódź, the Financial Ombudsman. – First, it ensures the predictability of the jurisprudence, and only in such conditions are customers able to estimate the possible financial consequences of specific actions. Therefore, the resolution is important both for those who wish to pursue their rights in court and for those considering the possibility of an amicable settlement of the dispute. Secondly, and equally important, the application of the theory of two claims is more beneficial for consumers, who are the weaker party in disputes with financial institutions and they bear the consequences of illegal provisions applied by banks in their loan agreements.
The balance theory and the two claims theory in practice
So far, common courts have presented divergent views on mutual settlements of the Swiss franc loan holders with banks. The Financial Ombudsman postulated that the Supreme Court unequivocally define the rules according to which the parties are to settle claims in the event that the loan agreement is deemed invalid. He pointed out that from a legal point of view it is justified to apply the theory of two claims.
– In practice, this means that if the contract is considered invalid, the borrower has the right to demand the bank to return the benefits in full, even if he has not yet repaid the loan. In this case, the key is how much the borrower has given back to the bank, and not how much he has borrowed from him. Moreover, in order to recover the amount of the disbursed loan, the bank should submit its own claim – explains dr. Ewa Skibińska from the Office of the Financial Ombudsman. – To facilitate the settlement, either party may submit a statement of deduction. For example, a customer who has so far repaid less than the amount of the loan granted can then only settle the difference between these amounts.
The balance theory [Polish: “teoria salda”] questioned today by the Supreme Court said that the subject of the claim could only be the difference between the value of the loan and the already repaid installments. In the opinion of the Financial Ombudsman, the balance theory is unfavorable for consumers, and there is no basis in applicable law. Applying the balance theory, the court would only admit the difference between the sum of the installments paid by the client and the amount made available by the bank. This would lead to a paradoxical situation. Although the court would have declared the contract invalid, the trial would have resulted in a loss for the consumer as regards the demand for reimbursement of the sum of the repaid installments. Most importantly, the balance theory did not lead to the goal of settling the matter in one process. In cases where the courts applied this theory, borrowers continued to face subsequent lawsuits from banks.
Positive effects of the Supreme Court resolution
– Indication of what rules should be applied to settle the contract, if it is deemed invalid, will improve the security of legal transactions and increase consumer confidence in the stability of the law. Due to the lack of predictability in this respect, when filing the claim, the customer had to take into account a number of contradictory legal views, which forced the formulation of possible demands in the claim. This resulted in an unnecessary extension and complication of court proceedings, which was detrimental to consumers. The instruments at the disposal of the Financial Ombudsman allow for a real improvement in the situation of consumers in Poland. If I notice similar problems in other aspects, I will use all available methods to support customers in disputes with financial institutions – declares Mariusz Golecki.
The importance of the Financial Ombudsman’s request
A request to the Supreme Court to resolve discrepancies in the case law is one of the powers of the Financial Ombudsman, which has a significant impact on the rights of consumers in our country. The resolution of the Supreme Court leads to ensuring the predictability of jurisprudence by unifying the jurisprudence of common courts and is an incentive to review the attitude of the banking sector. Since 2003, the Financial Ombudsman has filed 24 requests for a resolution of the Supreme Court (including the above). So far, the Court has adopted 22 resolutions, of which 21 times it shared the Defender’s view expressed in the request.
The Financial Ombudsman consistently supports the heavily injured.
27 April 2021
The Financial Ombudsman presented an ‘important view’ in cassation proceedings before the Supreme Court. The case concerns the amount of the social pension for a girl injured in an accident, who requires round-the-clock care. The decision of the Court will be important not only in this case, but also for other people who will find themselves in a similar situation.
– We are monitoring this case, not only due to the situation of the victim and her family. I have decided to present an ‘important view’ on this matter, as the decision of the Supreme Court may have a broader dimension. The issues resolved in this case are considered inconsistently by courts of different instances. The position of the Supreme Court may be a step in shaping a line of jurisprudence favorable for people who are seriously injured in accidents – says dr hab. Mariusz Jerzy Golecki, professor at the University of Łódź, Financial Ombudsman.
The dispute concerns the rights of a girl injured in an accident in February 2011. She was hit by a car as she was using a marked pedestrian crossing near the school. The result of the accident is tetraparesis. Currently, she is unable to function independently, to perform basic activities, and requires round-the-clock care.
The attorney of the injured girl demands a wider scope of reimbursement of the costs of care and questions the recognition of the social pension as a disability pension for increased needs. The Financial Ombudsman supports these claims with legal argumentation in three key issues in this case.
What is the time frame of care?
In particular, the Supreme Court will decide whether the 24-hour care and assistance, the costs of which are compensated under the disability pension for increased needs, may only cover the scope of physically performed activities helping the victim. Perhaps it should additionally include the time of care, supervision, readiness to help the injured person until the need to perform a specific physical activity, in particular at rest and at night? Consequently, should the calculation of the costs of round-the-clock care and assistance of third parties take into account 24 hours or less?
In the opinion of the Financial Ombudsman, the disability pension due to increased needs should cover a wider scope of activities performed, i.e. the time of care, supervision, readiness and vigilance with the injured person until the need to perform a specific physical activity, including during rest and at night.
Who determines the time frame of care?
Related to this issue is the question to what extent the condition for determining the length of care as an increased need in light of Art. 444 § 2 of the Civil Code are medical categories, i.e. the extent of bodily injury and health disorder and the related need for care in a specific dimension, such as in this case around the clock to maintain vital functions. The key is to decide whether this is special information in the scope of which the court should not make a determination – contrary to the opinion of an expert – based on its own conviction.
In the opinion of the Financial Ombudsman, in such a situation the Court should not do it. In the important view, he argues that if the court makes its own opinion on issues requiring special knowledge, ignoring evidence from an expert opinion, there may be a violation of Art. 278 § 1 of the Code of Civil Procedure.
Can the disability pension be reduced due to increased needs?
The third issue is whether the disability benefit due to the aggrieved party in accordance with Art. 444 § 2 of the Civil Code, shall be reduced by the amount of the social pension received by the aggrieved person.
According to the Financial Ombudsman, this is unacceptable. In the opinion of the Financial Ombudsman, both the purpose and function of the social pension (regulated in the Act on social pension) and the disability pension due to increased needs (regulated in Art. 444 § 2 of the Civil Code) are not identical.
Support for the whole family
It is worth emphasizing that the Financial Ombudsman supports the entire injured family by presenting relevant views at the stage of a court dispute. A few months ago, he presented an important view in cassation proceedings in which the girl’s mother is fighting for compensation for the violation of personal interests in the form of an emotional bond between relatives. The insurer believes that she is not entitled to such claims. The Financial Ombudsman is of the opposite opinion.
Important CJEU judgment for borrowers
23 April 2021
On April 22, 2021, the CJEU issued a judgment in the Profi Credit Slovakia case (C-485/19), which should be applied directly to the courts’ interpretation of the Polish provisions of the Civil Code regarding the commencement of the limitation period for consumer loans.
The case concerned a Slovak consumer who, after repaying the entire loan, was informed by a lawyer that the provisions of the contract were unfair. Therefore, he brought an action for the reimbursement of – in his opinion – unduly collected fees. On the other hand, the loan company raised the statute of limitations for his right to pursue claims. The Slovak limitation system applicable to consumer claims includes, among others, a three-year limitation period, starting from the time of unjust enrichment. The right to bring an action becomes time-barred even if the consumer is not in a position to judge for himself whether a contract term is unfair or was not aware that such a term was unfair. Therefore, the event that triggers the commencement of this period is the payment made by the consumer with the intention to perform the contract. This deadline should be calculated separately for each payment made by the consumer during the performance of the contract.
The Advocate General was apt to point out in pt. 72 that if the commencement of the three-year limitation period is each payment made by the borrower, it may be that, under a contract that is performed for more than three years, individual claims of that borrower are time-barred before the contract ends.
In pt. 60 of this judgment, the Court held that, as regards the commencement of the limitation period in question, in circumstances such as that in the present case, there is a significant risk that the consumer concerned will not invoke the rights conferred on him by EU law within the time limit set for that purpose. This would therefore prevent the consumer from pursuing these rights (see, to that effect, judgment of 5 March 2020, OPR-Finance, C-679/18, EU:C:2020:167, paragraph 22).
In justifying its position, the Court referred to the fundamental assumption that consumers are in a worse position than companies, both in terms of negotiating power and the degree of information, and that it is possible that consumers are not aware of the scope of their rights under the Directive 93/13 or Directive 2008/48 or do not understand them (see, to that effect, judgments of July 9, 2020, Raiffeisen Bank and BRD Groupe Société Générale, C-698/18 and C-699/18, EU: C: 2020: 537, pts. 65 to 67, July 16, 2020, Caixabank and Banco Bilbao Vizcaya Argentaria, C-224/19 and C-259/19, EU:C:2020:578, pt. 90 and the case-law cited therein).
In pt. 64 of this judgment, the Court found that the procedural rules – which require the consumer to bring an action within three years from the date on which the unjust enrichment took place, where such enrichment may take place during the performance of the contract for a significant period – render excessively difficult exercise of the rights conferred on the consumer by Directive 93/13 or by Directive 2008/48, thereby infringing the principle of effectiveness (see, to that effect, judgments of 9 July 2020, Raiffeisen Bank and BRD Groupe Société Générale, C-698/18 and C-699/18, pts. 67 and 75, of 16 July 2020, Caixabank and Banco Bilbao Vizcaya Argentaria, C-224/19 and C-259/19, pt. 91).
The Court also noted that the intention of the company which applied a contract term deemed unfair does not affect the rights that consumers are entitled to under the provisions of Directive 93/13, just as Art. 10 sec. 2 of Directive 2008/48. Thus, the consumer cannot be required, in order to invoke the rights under these provisions, to demonstrate the intentional nature of the conduct of the company concerned.
In conclusion, the Court held that the principle of effectiveness must be interpreted as precluding national legislation providing that an action brought by a consumer for the recovery of amounts unduly paid on the basis of unfair contract terms within the meaning of Directive 93/13 or terms contrary to the requirements of Directive 2008/48 is subject to a three-year limitation period commencing on the day on which the unjust enrichment took place.
Families of seriously injured victims are waiting for new regulations.
23 April 2021
The President of the Republic of Poland submitted to the Sejm a draft law adding to the Civil Code a provision important for relatives who are in a vegetative state, e.g. as a result of a traffic accident or a medical error. It involves granting them the right to compensation for the harm they have suffered in the form of broken family ties as a result of serious and permanent bodily harm. This solution is needed due to the currently existing discrepancy in jurisprudence at the level of the Supreme Court.
The president proposes to add Art. 446 to the Civil Code. The provision would grant the immediate family members of the victim compensation for the harm suffered in the form of broken family ties as a result of serious and permanent damage to the body or health of the victim, as a result of which the victim is in a vegetative state.
– This is a necessary initiative, as it is about confirming that the family bond is a personal right, the violation of which deserves redress. Families of seriously injured victims have been living in uncertainty for several months now. The introduction of statutory regulations will prevent their rights from being questioned, for example, by the insurers of the perpetrators of damages, as a result of which the injured persons found themselves in a vegetative state – says dr. Mariusz Jerzy Golecki, professor at the University of Łódź, the Financial Ombudsman.
He reminds that insurers gained a basis for such a position as a result of the resolution of the Supreme Audit and Public Affairs Chamber of the Supreme Court of October 22, 2019 (reference number I NSNZP 2/19). It took a completely opposite position to that presented a few months earlier by the Civil Chamber of the Supreme Court. On March 27, 2018, it adopted a resolution on the motion of the Financial Ombudsman (III CZP 36/17) and in two other cases concerning the same problem (III CZP 69/17 and III CZP 60/17). The conclusion of all three resolutions was clear: The court may award compensation for harm to the relatives of the victim who suffered a serious and permanent health impairment as a result of a tort. On this basis, compensation could be paid, for example, from a motor third party liability insurance policy, if the aggrieved party suffered a car accident. The same rules would also apply to the relatives of people who suffered as a result of medical errors, e.g. those committed during childbirth.
The Financial Ombudsman acts to protect the rights of the victims’ families
Seeing this discrepancy and its negative consequences for the aggrieved parties, the Financial Ombudsman applied to the Supreme Court for a resolution. (more details in the link below). He emphasized that, in his opinion, such situations are undoubtedly an example of infringement of the personal rights of relatives, which undoubtedly deserves financial compensation. He noted that from March 2018, insurers began to change their approach, in line with the position of the Civil Chamber.
Some insurers still question such entitlement of the relatives of the victims. For example, the Ombudsman dealt with the case of a victim in 2005. He was 15 when he was hit by a car. The boy suffered injuries in the form of a contusion of the brainstem, which resulted in swelling of the brain and circulatory and respiratory failure. Among other things, a tracheotomy was necessary, i.e. cutting the trachea to ensure breathing. Currently the injured person is over 30 years old and is incapable of functioning independently, and requires round-the-clock care and assistance. He became permanently disabled, both mentally and physically, and was thus excluded from active life. There is no contact with him, he does not speak, does not give clear and understandable signs in response to questions.
In connection with this situation, the victim’s mother, who takes care of him on a permanent basis, applied to the insurer for compensation in the amount of 200,000 PLN. The legal basis is Art. 448 of the Civil Code in connection with Art. 23 of the Civil Code and Art. 24 of the Civil Code as compensation for the harm resulting from the violation of personal interests in the form of damaged family ties and relationships due to the son’s permanent and serious disability.
The insurer, who issued the motor third party liability insurance policy for the perpetrator of the accident, refused to pay compensation. He indicated that the injuries suffered by the injured person did not cause him to be in an irreversible state of a coma or a permanent vegetative state. Thus, in the opinion of the insurance company, the personal interest of the victim’s mother was not infringed.
The Financial Ombudsman also dealt with cases of people injured as a result of medical errors. In this case, the mere demonstration of the responsibility of a medical facility is very difficult and time-consuming. Even if this happened and the insurers paid out a number of other benefits due in such a situation, they would refuse the previously mentioned compensation. In one of the cases, a newborn was infected in a hospital. Currently, the child has hemiparesis, brain changes, epilepsy, and nystagmus. The child does not speak, does not walk, sits down with help, and its intellectual development is delayed. Nevertheless, the insurer did not pay adequate compensation here as well.
An extraordinary appeal of the Financial Ombudsman in a dispute over car repair costs
8 April 2021
The Financial Ombudsman brought another extraordinary appeal to the Supreme Court. This time he is fighting for the right to reconsider the dispute between the injured party and the insurer for over 11,000 PLN. The dispute concerns the payment of compensation equal to the cost of repairing the car, calculated by experts. The Financial Ombudsman informs that the aggrieved party has the right to do so even if the damaged car has not been repaired and sold.
– I decided to file an extraordinary appeal, because in this case we are dealing with an incorrect, and grossly, incorrect interpretation of the law. By adopting the approach presented by the District Court, the second instance court would also violate the constitutional principle of equality before the law. Therefore, the revocation of the judgment under appeal is necessary to ensure compliance with the principle of a democratic state ruled by law implementing the principles of social justice. The violations in the complaint are so serious that they order the Supreme Court to interfere with the res judicata by upholding the complaint, setting aside the judgment under appeal and referring the case for reconsideration – says Dr. Mariusz Jerzy Golecki, professor at the University of Łódź, Financial Ombudsman.
The dispute between the injured party and the insurer, in which the Financial Ombudsman filed an extraordinary appeal, concerns the effects of a car collision in April 2013. The insurer of the perpetrator decided that the repair of the victim’s car was not worth it. This means that its costs would exceed the value of the vehicle on the day of the damage, estimated at 20,800 PLN. Therefore, the insurer declared the so-called total loss, estimated the wrecked vehicle at 13,400 PLN and paid out 7,400 PLN in compensation.
The court of first instance agrees with the injured party
The injured party did not agree with this position. He hired an expert, whose calculations confirmed that the repair costs were lower than the value of the car before the accident. The injured party asked for additional compensation covering the calculated repair costs. However, the insurer did not change his mind. The dispute continued and the injured party, unable to wait for the payment of compensation allowing for the repair, sold the damaged car. However, he retained the right to compensation equal to the cost of repairing the car, calculated by an expert. Therefore, he brought the case to court. The expert appointed by the first instance court confirmed that the insurer incorrectly assessed both the repair costs and the value of the vehicle on the date of the damage. According to these calculations, there was therefore no basis for considering the damage to be total. As a result, in March 2018, the court of first instance found that the insurer is obliged to pay an additional amount of almost 9,000 PLN for the cost of repairing the vehicle and the return of 450 PLN paid by the customer for the services of an expert. He also added default interest, so in total over 11,000 PLN were to be transferred to the customer’s account.
– The court of first instance, referring to the well-established line of jurisprudence of the Supreme Court and common courts, rightly pointed out that the compensation owed by the insurer under the compulsory third-party liability insurance of motor vehicle owners in the event of partial damage covers deliberate and economically justified repair costs. The obligation to repair the damage does not depend on the fact of repairing the damaged car, and even less on other subsequent events in the form of its sale. In the case of partial damage to the vehicle, the insurer’s indemnity is reduced to the payment of the amount necessary to restore the vehicle to its previous condition in all material respects – explains Andrzej Kiciński, Deputy Financial Ombudsman.
The second instance court is on the side of the insurer
The insurer fought on, raising the argument that after selling the damaged vehicle, the injured party cannot claim compensation for repair costs. It turned out that he found the understanding of the court of second instance, which in January 2019 changed the judgment and dismissed the injured party’s claim for payment of repair costs. The District Court took the interpretative position that in the case of selling a damaged vehicle, even if the repair costs are not excessive, the obligation to repair the damage is limited to the difference between the market value of the vehicle in an undamaged condition and the value of the accident remnants.
– The analysis of the justification of the judgment shows that the interpretation of the provisions of law made by the court of second instance with regard to the notion of damage and the amount of due compensation is unequivocally assessed in the jurisprudence of the Supreme Court as erroneous, and grossly at that. In our opinion, this justifies the submission of an extraordinary appeal by the Financial Ombudsman – says Andrzej Kiciński.
It is also reminiscent of Supreme Court judgments of 8 March 2018, II CNP 32/17; of April 12, 2018, II CNP 41/17, and of April 12, 2018, II CNP 43/17 (available at the website of the Supreme Court). In cases where, after causing partial damage, the damaged vehicle was sold and where the common courts limited the concept of damage to the difference between the market value of the vehicle in the state before the damage and the price obtained from the sale of the damaged vehicle, the Supreme Court clearly qualified this type of interpretation of the law as gross violation of substantive law (mainly Art. 363 of the Civil Code, Art. 361 of the Civil Code and Art. 822 of the Civil Code) and then found that the judgment was unlawful.
It is also impossible to ignore that in 2018 the Supreme Court refused several district courts to answer legal questions regarding the rules for determining compensation in the event of a partial repair of a damaged car or the sale of accident remnants. The Supreme Court in the justification of the decisions refusing to adopt a resolution consistently indicated that the jurisprudence of the Supreme Court is well-established and there are no grounds for making the amount of compensation dependent on the fact of repairing or limiting liability to the difference between the market value of the damaged vehicle and the value of the remnants in the event of the sale of the damaged car. In the case of partial damage to the vehicle, and in the event of the sale of an unrepaired car, the injured party may still claim compensation corresponding to the repair costs, and limiting liability to the difference between the market value of the undamaged vehicle and the wreckage is unjustified.
– This and other cases show that the dispute with the insurer can last for many years. It is difficult to expect victims to refrain from making decisions about the car until the case is settled by the court. If the insurer has not paid enough compensation to repair the vehicle, selling the remnants is often the only option. In this situation, it is difficult to accept the deprivation of the injured party’s right to demand an additional payment covering the full cost of repairing the damage – says Andrzej Kiciński.
He adds that such an approach would also violate Art. 32 of the Polish Constitution, the principle of equality before the law. Those who did not sell the wrecked vehicle would be treated better than those who did, although there is no legal basis for such a gradation of their legal situation.
Possible consequences of an extraordinary appeal
The setting aside of the judgment under appeal and the referral of the case for reconsideration will give the injured party the chance to obtain due compensation. It will also be a clear indication for those who find themselves in a similar situation that they may still pursue their rights, e.g. by submitting a request to the Financial Ombudsman for an extraordinary appeal.
Persons whose dispute on a similar background is currently pending in court have the option of submitting to the Financial Ombudsman a request to present a relevant court for the case.
Those who in the past have refused to pay for repair costs and have not decided to go to court can still pursue their claims against the insurer if they are not time-barred. In most traffic accidents, it will be three years from the receipt of the last decision in a given case from the insurance company. But in cases where the damage was a crime, it could be as long as 20 years. If such a complaint is rejected, the Financial Ombudsman can be asked to intervene.
Remember! The right to demand coverage of the costs of the appraiser service
In this case, there is also a dispute over the return of 450 PLN – the remuneration of the expert hired by the customer. The consequence of an incorrect interpretation in the dispute concerning the surcharge was the rejection of this claim by the court of second instance. In the opinion of the Financial Ombudsman, customers have the right to use professional support in a dispute regarding the extent of the damage or repair costs.
It is worth remembering that the Supreme Court, in a resolution adopted at the request of the Financial Ombudsman, confirmed the right of injured parties and assignees to demand that the costs of the expert’s opinion be covered from the motor third party liability insurance. He also made a reservation that they must be proved necessary for the effective claiming of damages. In practice, this means applying the simple principle “who is wrong, pays”. It follows from the justification that if the expert’s opinion shows that the insurer has underestimated the compensation, the customer should have no problems obtaining a refund of costs. (more in the link below) Therefore, if in the past the injured person hired an appraiser to determine the cost of the repair, he or she can additionally submit a request for coverage of the costs of such a service by the insurer.
An information leak from Facebook can be used by criminals to commit fraud. The Financial Ombudsman’s warning.
8 April 2021
The personal data of 533 million Facebook users appeared on a hacking forum on the Internet. Among them were data of nearly 2.7 million users from Poland. Leaked names, phone numbers, home addresses as well as locations, previous locations, birth dates, biographies, account creation dates, relationship status, and sometimes email addresses. The Financial Ombudsman warns that such a large information base may be used by criminals for attacks using social engineering techniques or attempts to break into other profiles or accounts, including bank accounts. What steps are worth taking?
According to the Financial Ombudsman, the data leaked a few days ago may be used as a tool for identity theft or breach of other security measures. That is why it is so important to protect personal information and react appropriately to phishing attempts. The Ombudsman already recommends taking appropriate steps and creating a habit of protecting personal data by each of us.
Remember that if an unknown person is calling you, it may be a scammer. Even if the person provides you your data in order to authenticate the contact, this data may come from a leak. We should also pay more attention to emails and SMS messages we receive from strangers – these may also contain malicious software used for fraud or theft.
Leaking email addresses can allow scammers to impersonate real organizations, including the banks where our accounts are located. The Commissioner for Human Rights draws attention to the significant risk of the theft of funds from bank accounts. In order to minimize the occurrence of this risk, it is worth checking whether the bank uses strong authentication for all possible types of activities.
One of the most common forms of attack is a message to update your confidential data. Another form of fraud is the so-called “surcharge” fraud involving the impersonation of couriers, energy companies, debt collectors, or government offices in order to persuade you to pay by clicking on a link leading to a fake payment gateway. Be vigilant if you receive such a link. It will be much safer to enter the bank’s website address in the browser yourself or to use a tab you created yourself.
The Financial Ombudsman informs that in the event of an unauthorized payment transaction, this fact should be immediately reported to the bank together with the request for a refund, and a parallel notification of the possibility of committing a crime to the nearest police unit should be submitted. In accordance with the current legal status, the bank should return the amount of the unauthorized transaction to the customer’s account no later than by the end of the business day following the finding of the unauthorized transaction or after receiving the notification from the customer. A step that is worth taking preventively today is reviewing the data we share on social media platforms. In the era of increasingly common identity theft scams, it is worth presenting your data on the web with caution. Information that is not necessary for the creation and functioning of social media profiles is best to be left offline.
The court prevented aggrieved farmers from fighting the bank – an extraordinary appeal of the Financial Ombudsman.
1 April 2021
In 2009, a married couple – farmers from the Podlaskie Voivodeship – took a working capital loan for several dozen thousand zlotys from a bank. In their opinion, the payments made for the repayment of the loan were booked against other liabilities towards the same bank, which – as they declared – they did not incur. The bank, using the regulations in force at that time, issued a bank enforcement order, which the farmers tried to challenge in court. The district court dismissed their claim, and – according to the Financial Ombudsman – the errors of the second instance court closed the court to pursue their rights. The only solution for them is an extraordinary appeal, for which they asked the Financial Ombudsman.
The Financial Ombudsman therefore filed an extraordinary appeal to the Supreme Court dismissing the complaint against the decision rejecting the appeal concerning the deprivation of enforceability of the bank enforcement order issued by the bank in 2010.
The basis for issuing the bank enforcement order by the bank was the agreement for a working capital loan borrowed by the married couple of farmers from the Podlaskie Voivodeship. The bank enforcement order (which was in force in Poland until 2016) made it possible to conduct civil enforcement after the court had given it an enforcement clause. This, however, was actually granted automatically, as the court examined the bank enforcement order only in formal terms. In the present case, the bank appropriated a slurry tanker belonging to the farmers under the bank enforcement order. In 2017, the couple filed a lawsuit for deprivation of enforceability of the bank enforcement order. In it, they alleged, among others, that the claim was met and the bank’s enforcement title itself is time-barred.
In the judgment of November 4, 2019, the district court dismissed the claim of the farmers, finding that the bank enforcement order met all formal conditions, the claim was not time-barred, because the limitation period was interrupted by concluding settlements with the bank and that the debt, contrary to the clients’ claims, was not paid off.
The farmers, as plaintiffs, appealed against the decision of the court of first instance that was
unfavorable for them. The appeal was filed by them in person – without the participation of a professional attorney. Along with the appeal, they also applied for an exemption from the appeal fee. The court acceded to the submitted application for exemption from paying the appeal fee and partially released the clients from the obligation to pay it. The clients were therefore required to pay the remainder of the appeal fee.
However, a copy of the court’s decision on partial exemption from costs was delivered to the farmers’ attorney instead of to them. The court did not summon plaintiffs acting personally to pay the rest of the fee. As a result of a court error, the court did not recognize the appeal, rejecting it as unpaid within the deadline. The court hearing the appeal against the decision to reject the appeal duplicated the error of the court examining the appeal. Both courts found that the lack of a summons to pay the rest of the fee was due to the fact that the clients were represented by a professional attorney who signed a letter supplementing formal deficiencies previously submitted by the clients in person for an exemption from the appeal fee, in terms of declarations on assets and family.
In the opinion of the Ombudsman, the court acted incorrectly by not calling the clients to pay the missing fee, but only by sending the decision on partial exemption from it to the attorney who did not appeal.
The court did not make a subjective distinction between bringing an appeal together with an application for exemption from court costs personally by the clients and their representation in the proceedings by a professional attorney, which resulted in the irreversible effect of closing the clients’ way to control the judgment issued in the first instance.
Using the assistance of an attorney by clients in the first instance does not exclude the possibility of submitting an appeal by clients themselves. This was the case in the present state of facts. In such a situation, in the event of formal deficiencies, the court should instruct the clients to supplement them as if the clients had acted independently. However, this was not the case.
In the appeal, the clients raised the objection that the court did not recognize the essence of the case, the limitation of claims, erroneous recognition by the court that in the case there was an interruption of the limitation period for receivables resulting from the bank enforcement title and incorrect accounting of the amounts paid to the technical account, indicating
that, according to them, the loan in question had long since been paid off, while the amounts were posted for loans which the plaintiffs, they say, had never taken. For these reasons, they cannot be prevented from verifying the judgment of the court of first instance.
The Financial Ombudsman considered it necessary to take action and submit an extraordinary appeal in this case in order to open the way for clients to substantive examination of their case by a court of second instance. The issued decision unreasonably deprived the clients of the right to substantive review of the judgment of the court of first instance. The intervention of the Financial Ombudsman may cause the court of second instance to consider the appeal filed by the clients and to substantially refer to all the allegations raised in it.
A warning from the Financial Ombudsman – watch out for cryptocurrency loans
19 March 2021
The Financial Ombudsman’s office receives client complaints about entities that require prepayment in exchange for a loan promise. Recently, they concern a company that promised a loan using cryptocurrencies.
In the past few weeks, the Financial Ombudsman has received over a dozen requests from clients complaining about the activities of one of the loan companies. It makes granting a loan dependent on the client’s payment of certain funds. They are to be used to cover the costs of the loan-related fees. Most often, these are amounts of about 1,000 PLN, but one of the persons paid as much as 19,000 PLN. Additionally, the company requires the establishment of collateral, e.g. in the form of a promissory note. Despite the fulfillment of these conditions, the money does not go to clients, and contact with its representatives is difficult.
– The case is particularly worrying because in many cases it can be people who are in a poor financial situation, often already excessively indebted and with an unfavorable credit history. These people are particularly vulnerable to unfair practices of lenders, because they often operate under pressure and do not have sufficient knowledge to analyze the concluded contract. After reviewing the clients’ explanations and the documents provided, we can see that the company’s actions can be considered unfair or even fraudulent. Therefore, we informed the relevant state authorities – says dr. hab. Jakub Szczerbowski, director of the Banking and Capital Market Customer Department in the office of the Financial Ombudsman.
The contracts analyzed by the experts of the Financial Ombudsman contain a number of questionable provisions regarding activities preceding the granting of the loan. The mechanism of transferring funds to the clients is also surprising.
– The borrower is allegedly reserving funds in the Bitcoin cryptocurrency. Bitcoins are converted into US dollars. Then the US dollars are converted into Polish zlotys. Funds in Polish zlotys – in accordance with the provisions of the contract – should be made available to the borrower via a prepaid payment card – describes Paulina Tronowska, legal advisor at the office of the Financial Ombudsman.
In its view, this method of performance has no economic justification. It may in fact provide a facade for the actual actions of the subject, obscure the true picture of the situation and distract the consumer, preventing him or her from making a rational decision.
– If anything raises your doubts, you should refrain from signing such an agreement. You have the right to obtain an information form to read the terms and conditions. It is also worth searching the Internet for information about the company and the way it operates. If you have already decided to conclude such an agreement and during its implementation you have doubts as to the fairness and lawfulness of its provisions, a complaint should be submitted to the financial market entity. If it is not examined in accordance with our expectations, you can ask the Financial Ombudsman for and intervention or an amicable settlement. When you suspect that you have fallen victim to fraud, you should contact the Police or the Prosecutor’s Office as soon as possible – says Paulina Tronowska.
It encourages immediate action by people who feel disadvantaged by the actions of financial market entities or other entities offering financial services.
– This will allow the competent authorities to react quickly to possible irregularities in the financial market. It can also help protect other market participants from unfavorable disposal of their savings – says Paulina Tronowska.
CJEU on the banking and capital market in 2020. Analysis of the Financial Ombudsman.
18 March 2021
Legal issues relating to financial products and services are hotly discussed in both case law and public debate. This issue is also taken up by the EU Court of Justice, which sets the directions for the interpretation of EU regulations. This directly translates into the jurisprudence of the courts of the Member States, including Polish courts. Noticing the importance of the above interpretations for customers of financial market entities, the Financial Ombudsman analyzed the rulings of the CJEU issued in 2020.
– Following and analyzing the jurisprudence of the CJEU is of great importance due to the legal nature of these judgments and the rules of their application. The Court very often emphasizes the leading role of the national court in consumer cases. According to the judges of the CJEU, the inequality between the consumer and the company can only be offset by the active intervention of a third party, independent of the parties to the contract, which is the Polish court. A good example is the judgment in the case of the Medius Law Firm, C-495/19. It emphasized that it is the court that is obliged to interpret national provisions in line with EU law – says dr. hab. Mariusz Jerzy Golecki, professor at the University of Łódź, Financial Ombudsman.
In the opinion of the Financial Ombudsman, among the issues raised in the jurisprudence of the CJEU in 2020, two issues should be highlighted. Firstly, the problem of the effects of unfair terms in consumer contracts (defined in Polish law as prohibited contractual provisions or abusive clauses), especially in loan agreements denominated and indexed in a foreign currency. Secondly, there is the question of the cost of the loan for the consumer.
Taking into account the national legal context of each of these cases, which are part of this study, it should be noted that the position of the Court of Justice always concerns the interpretation of EU law and thus this interpretation should be binding when judging by Polish courts on the basis of Polish provisions.
The Financial Ombudsman in defense of the Dziubak family
4 March 2021
The Financial Ombudsman joined a court case in which the Dziubak family will defend themselves against Raiffeisen’s claim for remuneration for using capital. In total, the bank demands from them almost twice as much as they borrowed, i.e. around 800,000 PLN.
– I have been saying for a long time that neither Polish nor EU law has a legal basis for such expectations on the part of the bank. In addition, I believe that in this case the size of the claim is to act as a deterrent to other customers from pursuing their claims. That is why I decided to join the case initiated by Raiffeisen Bank International AG Branch in Poland against Justyna Dziubak and Kamil Dziubak. I hope that our support and arguments will allow them to effectively defend themselves against the bank’s claims – says dr. hab. Mariusz Jerzy Golecki, professor at the University of Łódź, Financial Ombudsman.
The case concerns a mortgage which was taken 2008. The bank’s customers borrowed 400,000 PLN and the loan value was indexed to CHF. After several years of paying installments, the borrowers filed a lawsuit against the bank for the cancellation of the loan agreement and the return of the undue benefit in the form of the sum of their installments.
The bank, without waiting for a final decision of the nullity of the agreement by the court, called on the Dziubak family to pay for the use of its capital. Next, the bank filed a lawsuit with the court for the payment of the nominal amount of the loan with an additional demand for its indexation by the court and the amount constituting, in the opinion of the bank, remuneration for using its capital. In total, the bank demands from the Dziubak family almost twice the amount of financing provided. In the opinion of the bank, in the event of a final court ruling on the invalidity of the agreement, the Dziubak family will be unjustifiably enriched, which justifies the filing of a lawsuit.
An increase in problems with unauthorized transactions.
1 March 2021
In 2020, almost 1,200 requests for intervention in a dispute regarding an unauthorized banking transaction were submitted to the Financial Ombudsman. The scale of the problem during the pandemic is growing dynamically.
The preliminary summary of the impact of requests for the intervention of the Financial Ombudsman in 2020 shows that 1163 of them concerned so-called unauthorized transactions. This means that on average, almost 5 people per working day reported to the Ombudsman for help in resolving disputes. Most often they concern situations in which the victims lost money from an online bank account or a payment or credit card as a result of fraud.
– The scale of the increase in the number of requests of this type, observed in 2020, is worrying. There were almost twice as many requests as in 2019. We have not recorded such dynamics in any of the previous years of our activity. There is no doubt that this is the result of the pandemic and greater activity of criminals. In the first half of 2020, we recorded slightly more than 400 requests for intervention in cases of a bank’s improper operation in connection with unauthorized transactions. In the second six months, there were nearly 750 such requests. Unfortunately, some banks still do not comply with EU and Polish regulations that define the rules of conduct in such cases. Hence, the number of such disputes is growing – says dr. hab. Mariusz Jerzy Golecki, professor at the University of Łódź, Financial Ombudsman.
Apart from intervention procedures, he also undertook other activities permitted by law. In one of the cases, he filed an extraordinary complaint to the Supreme Court. In the case of a farmer who lost approx. 140,000 PLN, which was stolen by criminals from his account, filed a lawsuit against the bank as it did not act in this case in accordance with the provisions.
– We are aware that only some of the victims come to us asking for help. Customers trust the banks’ explanations provided in response to their notification or complaint about this type of transaction. We can see, however, that the banks’ interpretation of the regulations is different from ours. That is why I made a decision that one of the topics of our free educational webinars should be the issue of customers’ rights in such a situation. Customers need to know their rights and know how to get our help in enforcing them against banks – says Mariusz Golecki.
When should the bank return the money stolen from your account?
The regulations define the deadline for the return of funds resulting from an unauthorized transaction based on the so-called D+1 rule. According to it, the money should be returned to the customer’s account no later than the end of the business day following the detection of the unauthorized transaction or the date of receipt of the customer’s request. The only exception to the rule of returning the amount of the unauthorized transaction within this period is a justified and duly documented suspicion of fraud attempted by the customer. At the same time, the bank is obliged to inform law enforcement authorities of such suspicion in writing. In practice, this means that the bank is first obliged to immediately return the money to the customer, and then – if it has reason to believe that the customer is fully or partially responsible for the unauthorized transaction – claim this amount from the customer, for example in court. (details in the diagram: How to proceed after detecting an unauthorized transaction?)
Important activities of the Financial Ombudsman regarding unauthorized transactions in 2020
October 2020 – extraordinary complaint for refusal to refund the amount of an unauthorized transaction
September 2020 – a lawsuit by the Financial Ombudsman on behalf of a customer who lost 140,000 PLN as a result of an unauthorized transaction
September 2020 – an analysis by the Financial Ombudsman on unauthorized transactions
June 2020 – applying to banks for information on the scale of the problem and explanations on the procedures to be followed in such situations.
How has the number of requests for the intervention of the Financial Ombudsman in disputes related to unauthorized transactions increased?
In 2016, i.e. the first full year of the Financial Ombudsman’s activity, there were 147 requests. In the next year there were 250, which means an increase of 70%. In 2018, there were 47% more requests – 367. In 2019, this number reached 612 (a 67% increase). 2020 brought a record 1,163 requests – 90% more than in the previous year.
The Financial Ombudsman defends Swiss franc loan holders who may lose their homes.
25 February 2021
The Financial Ombudsman filed an extraordinary complaint to the Supreme Court regarding the default judgment in the case of Swiss franc loan holders. By the decision of the court, the bank’s customers may lose their homes. In the opinion of the Financial Ombudsman, the court should not make such a decision solely on the basis of an extract from bank books. It should have previously examined the provisions of the contracts in terms of prohibited clauses.
Customers who signed a 360-month mortgage loan agreement in 2008 requested the assistance of the Financial Ombudsman. They had borrowed 288,000 PLN, which was converted into approx. 150,000 CHF. The borrowers have been repaying the loan for over 10 years. Unfortunately, at some point they could not pay the installments on time. As a result, the bank terminated their loan agreement. Next, it filed a lawsuit demanding immediate payment of over 468,000 PLN. The amount was about 180 thousand PLN higher than the amount borrowed by customers due to the mechanism of indexation of the loan amount to CHF. During this period the exchange rate of this currency in relation to the zloty increased significantly.
As proof of the validity of the claims, it presented an excerpt from the bank books. The court decided that the circumstances of the case did not raise any doubts and allowed the claim. The defendant consumers did not have the support of a professional attorney at this stage. As a result, they failed to challenge the judgment effectively. Thus, the default judgment became final. At present, the borrowers are required to pay the entire amount requested, and based on the judgment the bank is carrying out execution of the release of their real estate.
The customers turned to the Financial Ombudsman for help. After reviewing the case files, the Ombudsman made a decision to file an extraordinary complaint.
– I believe that the ruling in this case is inconsistent with the principles of a democratic state ruled by law, violates the principles of consumer protection against unfair market practices and indicates a gross violation of procedural law – says dr. hab. Mariusz Jerzy Golecki, Financial Ombudsman.
In the opinion of the Ombudsman, conversion clauses referring to exchange rates tables set unilaterally by the bank, without indicating objective criteria, are non-transparent, leave room for the bank to act arbitrarily and thus burden the borrower with unpredictable risk and violate the equality of the parties. Therefore, they grossly infringe the interests of the consumer and are contrary to good practices.
– There is no doubt that in the present case the court should ex officio examine whether the provisions of the CHF-indexed mortgage loan agreement are unfair, which it undoubtedly did not do – says Mariusz Golecki.
If the court upholds the position of the Financial Ombudsman, it will reverse the judgment under appeal. Then the borrowers will have a chance to take legal proceedings in which the court will examine the contract in terms of abusive clauses and the consequences resulting therefrom. This may mean that they will have to pay several times less than the amount currently requested by the bank.
It is worth emphasizing that the action of the Financial Ombudsman in this specific case may affect other consumers. Other persons who are in a similar situation will have a chance to change final judgments by means of an extraordinary appeal.
When should a request for an extraordinary complaint be sent to the Financial Ombudsman?
Requests for the submission of an extraordinary complaint by the Financial Ombudsman may concern judgments ending the proceedings in cases which became final after April 3, 2018. Only the Public Prosecutor General and the Ombudsman are entitled to an extraordinary appeal in relation to cases settled before that date.
It is worth emphasizing that an extraordinary complaint is intended to concern genuinely exceptional situations. One of three conditions must be met:
the judgment violates the regulations or human and citizen freedoms and rights specified in the Constitution;
the judgment flagrantly violates the law due to its incorrect interpretation or application;
there is a clear contradiction between the essential findings of the court and the content of the evidence collected in the case.
In addition, the submission of an Extraordinary Complaint will also be admissible only when the judgment under appeal cannot be changed or reversed by other extraordinary means of appeal. Moreover, an extraordinary complaint may not be based on the charges that were the subject of a cassation appeal by the Supreme Court. Additionally, against the same decision, in the interest of the same party, an extraordinary appeal may be brought only once.
In order for the Financial Ombudsman to be able to prepare an extraordinary complaint, it is necessary to present him with the most complete documentation concerning the case. It is necessary to describe the objections to the decision, present pleadings, and judgments of the courts of both instances with reasons and evidence. The Financial Ombudsman may make a decision to apply to the Supreme Court only on this basis. The ideal solution would be to prepare such a request by a professional attorney who already knows the case and has dealt with it in previous instances. He will also know best what conditions for submitting an extraordinary complaint have been met in a given case. Of course, this is not a formal requirement. If someone cannot afford an attorney, the lawyers of the Financial Ombudsman will perform such an analysis only on the basis of the documentation provided.
Extraordinary action regarding the settlement of a previously repaid loan.
22 February 2021
Almost 15,000 PLN plus interest will be recovered by the customers of one of the banks if the Supreme Court approves an extraordinary complaint filed by the Financial Ombudsman. It concerns the lack of settlement and the return of a part of the commission in connection with the early full repayment of a consumer loan.
Customers who concluded a consumer loan agreement in February 2016 contacted the Financial Ombudsman. They had borrowed 66,700, of which 50,000 PLN went to their account, and 16,700 PLN was left in the bank in the form of a commission. The contract was concluded for a period of 120 months, with the last installment to be paid in March 2026. They managed to fully repay the loan much earlier, in April 2017 (after 14 months). In this situation – in accordance with Art. 49 of the Consumer Loan Act – they asked the bank for a proportional reimbursement of the commission charged at the stage of concluding the contract. According to their calculations, it was almost 14,800 PLN. However, the bank did not acknowledge the borrowers’ claim and did not return a proportional part of the commission.
The court of first instance ruled in favor of the borrowers and awarded the requested amount. This approach is in line with the position of the Financial Ombudsman, which has been presented for many years. The bank appealed. However, the court of second instance dismissed the claim. It argued that Art. 49 sec. 1 of the Consumer Loan Act does not justify the customer’s request, and the commission is not a cost related to the loan period.
Due to the fact that the claim of the customers was lower than 50,000 PLN, they are not entitled to a cassation appeal. This means that the judgment is final, it terminates the proceedings and it is not open to an ordinary appeal. In this situation, the customers turned to the Financial Ombudsman for help. After reviewing the case files, the Financial Ombudsman made a decision to file an extraordinary complaint.
– I believe that the judgment of the second instance court is inconsistent with the principles of a democratic state ruled by law and indicates a gross violation of the law due to an incorrect interpretation of Art. 49 of the Consumer Loan Act – says dr. hab. Mariusz Jerzy Golecki, Financial Ombudsman.
The Financial Ombudsman has repeatedly presented his position regarding the interpretation of the said provision. It shows that in the event of early repayment of a consumer loan, all costs of such a loan are reduced. Their nature and when they were actually incurred by the borrower is irrelevant. This reduction is proportional, i.e. it applies to the period from the actual loan repayment date to the final repayment date specified in the contract. Settlement of the loan according to such rules may be requested by all customers who concluded such an agreement after December 18, 2011. That is when the provisions of the Consumer Credit Act came into force, regulating the rules for the settlement of previously repaid loans.
Possible consequences of an extraordinary appeal
If the court agrees to the position of the Financial Ombudsman, the customers will receive a refund of almost 14,800 PLN with statutory interest for the delay, calculated from April 2017. The bank will also have to cover the costs of the trial.
The position of the Ombudsman presented in the extraordinary complaint and the court’s decision will be important for all those who in the past were refused by a bank or a loan company to legally settle a previously repaid loan. The method of proceeding depends on how the dispute ended.
If the case has already been legally examined by the court and it has dismissed the customer’s claims, it is possible to submit an application to the Financial Ombudsman for an extraordinary complaint. However, this only applies to final and binding judgments after April 3, 2018.
If the case is still pending in court, it is possible to submit a request to the Ombudsman to present an important view of the case.
Customers who have previously repaid their consumer loan, but did not receive a proportionate reimbursement in accordance with the law, can still pursue their claims. They must first file a complaint with their bank or loan company. A special Financial Ombudsman calculator, available in the link below, may be helpful in determining the amount of the refund due. If it is not recognized, a request for intervention can be sent to the Financial Ombudsman.
When should a request for an extraordinary complaint be sent to the Financial Ombudsman?
Requests for the submission of an extraordinary complaint by the Financial Ombudsman may concern judgments ending the proceedings in cases which became final after April 3, 2018. Only the Public Prosecutor General and the Ombudsman are entitled to an extraordinary appeal in relation to cases settled before that date.
It is worth emphasizing that an extraordinary complaint is intended to concern genuinely exceptional situations. One of three conditions must be met:
- the judgment violates the regulations or human and citizen freedoms and rights specified in the Constitution;
- the judgment flagrantly violates the law due to its incorrect interpretation or application;
- there is a clear contradiction between the essential findings of the court and the content of the evidence collected in the case.
In addition, the submission of an Extraordinary Complaint will also be admissible only when the judgment under appeal cannot be changed or reversed by other extraordinary means of appeal. Moreover, an extraordinary complaint may not be based on the charges that were the subject of a cassation appeal by the Supreme Court. Additionally, against the same decision, in the interest of the same party, an extraordinary appeal may be brought only once.
In order for the Financial Ombudsman to be able to prepare an extraordinary complaint, it is necessary to present him with the most complete documentation concerning the case. It is necessary to describe the objections to the decision, present pleadings, and judgments of the courts of both instances with reasons and evidence. The Financial Ombudsman may make a decision to apply to the Supreme Court only on this basis. The ideal solution would be to prepare such a request by a professional attorney who already knows the case and has dealt with it in previous instances. He will also know best what conditions for submitting an extraordinary complaint have been met in a given case. Of course, this is not a formal requirement. If someone cannot afford an attorney, the lawyers of the Financial Ombudsman will perform such an analysis only on the basis of the documentation provided.
Important decisions in disputes regarding Swiss franc loans.
18 February 2021
Bank customers who have foreign currency loans should wait for the position of the Supreme Court, which is to be expressed on March 25 in a comprehensive resolution of the Civil Chamber, and then evaluate specific settlement proposals submitted by banks in these circumstances – says the Financial Ombudsman. In his opinion, this will allow them to assess the financial consequences more accurately and make an informed decision.
In recent weeks, a lot of information has appeared that is important for the holders of foreign currency loans. On the one hand, we have a number of reports of work on the terms of settlements that banks are to offer their customers. On the other hand, the First President of the Supreme Court presented to the full composition of the Civil Chamber six inquiries about key legal issues concerning such contracts. In this situation, the Financial Ombudsman has received questions about what actions should be taken in the current situation.
– Bank customers who have foreign currency loans should wait for the position of the Supreme Court, which is to be expressed on March 25 in a comprehensive resolution of the Civil Chamber, and then assess the specific settlement proposals submitted by the banks in these circumstances. This will allow for a more accurate estimation of the financial consequences and making an informed decision – says dr. hab. Mariusz Jerzy Golecki, professor at the University of Łódź, Financial Ombudsman.
He adds that he does not know the details of the settlements aimed at solving the problem of the foreign currency loans. It is not known whether this will be a solution adopted by the entire industry or only by some of the banks. It is also difficult to predict how they will potentially affect the legal position of the customers.
– Undoubtedly, it is worth analyzing any ideas for an amicable solution to these disputes. Therefore, I am pleased with the recently expressed NBP declaration as to the involvement of the central bank in solving this socially important issue – says Mariusz Golecki.
In the opinion of the Financial Ombudsman, in order to make a decision on a settlement, information is needed on the possible line of jurisprudence in courts. Therefore, the position of the Supreme Court on the application submitted on October 19, 2020 by the Financial Ombudsman (file number III CZP 6/21) regarding the resolution of discrepancies in the jurisprudence concerning the method of settlements between the parties after the cancellation of a loan agreement will be important.
– I expect it to be obtained in parallel with the announcement on March 25 by the full composition of the Civil Chamber of the Supreme Court of the answers to six legal issues formulated by the First President of the Supreme Court. One of these issues, defined in the fourth point, is the same as our application – says Mariusz Golecki.
He points out that on February 16, the Supreme Court, composed of three members, ruled that in the event of the cancellation of a foreign currency loan agreement, the so-called rule of two claims applies. This is in line with the arguments consistently presented by the Financial Ombudsman. Such an approach is a good omen for further resolutions of the Supreme Court on this issue. (more on this from the information available at the following link: the Supreme Court decides in accordance with the position of the Financial Ombudsman)
The decision by the full composition of the Civil Chamber on all the issues mentioned by the First President of the Supreme Court will be comprehensive. It will also concern the issue of the legitimacy of banks’ claims regarding remuneration for using capital.
– In my opinion, this matter is obvious. I find neither in Polish nor EU law any legal grounds to formulate such an expectation. I expressed this by filing a lawsuit against Raiffeisen Bank and joining the case of Santander Bank customers defending themselves in court against this type of claim. We are still waiting for these cases to be resolved and the judges will certainly refrain from ruling until the Supreme Court’s position on this issue is known – says Mariusz Golecki.
At the same time, he announces that the experts of the Financial Ombudsman will analyze the position of the Civil Chamber and its justification, and then present their conclusions as to the legal situation of Swiss franc loan holders.
The Supreme Court decides in accordance with the position of the Financial Ombudsman.
17 February 2021
The Supreme Court decided that in the event of the cancellation of a foreign currency loan agreement, the so-called the rule of two claims applies. This is important for Swiss franc loan holders because it is a more advantageous way of settling the cancelled contract. Such an approach is a good sign against the concept of the Supreme Court’s resolution resolving discrepancies in the jurisprudence requested by the Financial Ombudsman.
Information on the application of the Financial Ombudsman for a resolution of the Supreme Court – click the link
The Supreme Court composed of three members yesterday (February 16, 2021) dealt with a legal issue presented by the District Court in Warsaw. It concerned the principles of mutual settlements resulting from Swiss franc indexed loan agreements, which were deemed invalid due to its abusive clauses.
In the resolution (file no. III CZP 11/20), the Supreme Court opted for the application of the theory of two claims in such a situation, therefore each claim by both the borrower and the bank for issuing enrichment should be treated separately and independently of the other. The court referred to, among others, Art. 405 of the Civil Code, according to which, if the contract is deemed invalid, there is unjust enrichment on both sides of the contract. In such a situation, the borrower may effectively demand from the bank the return of the benefit in the form of principal and interest installments paid in the Polish currency or in a foreign currency. At the same time, the bank cannot refuse to pursue such a claim, arguing that the borrower has not returned the loan amount paid by the bank in the nominal amount.
– The position of the Supreme Court is an important step towards a fair solution to the problem of foreign currency loans. This problem is also related to one of the questions addressed to the full composition of the Civil Chamber by the First President of the Supreme Court. An unequivocal resolution of this issue is important for all litigants pending before the court. It is also important for those who withhold filing a lawsuit while awaiting a settlement proposal from the bank. Having knowledge of the rules of settlement of the contract, it is possible to more accurately estimate the financial effects of specific actions and make an informed decision – says dr. hab. Mariusz Jerzy Golecki, professor at the University of Łódź, Financial Ombudsman.
The Financial Ombudsman consistently presents arguments similar to those expressed in yesterday’s position of the Supreme Court. They can be found e.g. in his important views issued at the request of customers or courts at the stage of court proceedings. The Ombudsman also presented the same position by submitting an application for the resolution of discrepancies in the case-law by the Supreme Court (reference number III CZP 6/21) on October 19, 2020.
– After the annulment of the foreign currency loan agreement, both parties are obliged to make mutual settlements and return all benefits related to the implementation of this agreement, based on the provision of 410 of the Civil Code. Therefore, the bank may seek reimbursement from customers of a sum equal to the amount paid under the loan agreement. In turn, customers can claim the return of a sum of money corresponding to the sum of the amounts paid by them. Both of these claims are independent – explains dr. Ewa Skibińska from the Office of the Financial Ombudsman.