Posted on Sep 25, 2012 by | 0 Comments
It has recently been reported that independent reviewers have commenced sifting through 50 swap mis-selling cases provided by each of the UK’s largest banks as a trial run before launching a full review of thousands of cases.
The FSA will examine the trial review’s findings and so long as they are content that it has been dealt with appropriately, they will then give the green light for the full compensation scheme to begin. The FSA’s compensation scheme is expected to conclude by April 2013.
The FSA compensation scheme has been heavily criticised for lacking the independent safeguards to ensure the review scheme is robust and fair to mis-selling victims. There have been calls from the Federation of Small Businesses (FSB) to the UK Government set up a new independent review process due to the serious failings in the current FSA Scheme.
The current FSA scheme remains unclear:
* It is not certain what the banks interpretation of "fair and reasonable" is for structured collars.
* It is unknown whether the review of less complicated swaps will result in acceptable compensation.
* It is not known whether companies that became insolvent due to an interest rate swap will be able to make a claim if the administrator declines to pursue a complaint/claim.
*It is not clear to what extent the bank will use their FSA Scheme "loopholes" to limit claims. For example, the bank may argue that the customer is sophisticated and knew what they were getting involved with.
*Will the bank take their small print (such as non-reliance statements) into account when assessing whether a customer should be compensated?
*What is the position where a customer has lost his business and even his house because of the interest rate swap? To what extent will the customer be compensated?
We look forward to clarification on the above matters in due course.
If you have been mis-sold an interest rate swap agreement then please get in touch with a solicitor in our dispute resolution team who will be happy to have an informal discussion with you about the FSA Scheme and swap mis-selling.