On Monday 23 July at 7.30pm a programme will be aired on Channel 4 with Jon Snow investigating the current banking crisis. The programme will be focusing on whether the Libor scandal and the crisis of confidence between the Banks, the politicians, businesses and the public has affected trust in the banks.
In recent weeks FSA has fined Barclays for Libor manipulation and has also announced that Barclays with RBS, HSBC and Lloyds TSB have missold complicated interest rate hedging products to SMEs. There are now further reports about Clydesdale being also investigated for misselling and FSA looking into evidence of links between Credit Agricole, HSBC, Deutsche Bank and Societe Generale, amid concerns that they were part of a coordinated effort to rig the interbank lending rate.
In these circumstances, it is hard to imagine public trust in banks not having been affected. More interesting would be to see whether the programme also covers the procedure set in place by FSA for dealing with misselling claims submitted by SMEs. Initially it appeared that the banks would be the gate keepers, deciding which cases will be submitted to the independent assessor appointed by FSA. Due to the obvious risks concerned with allowing the banks decide who will and will not be compensated, FSA announced that it will review the procedure to be put in place and will thereafter publish in more detail how misselling claims will be handled in order to guarantee independence and fairness in their assessment.
We look forward with interest to Jon Snow’s programme and will be reporting on the conclusions he reaches.