Charity risks closure after RBS drag heels on swap case

Published: 23/01/2014

A Derby-based charity who claims to have been mis sold an interest rate swap may have to close its doors after being left to wait for six months for a decision regarding their claim.

Direct Help and Advice, which helps people at risk of being made homeless, has accused RBS of mis selling them an interest rate swap, claiming it had not been made aware of the £250,000 exit cost. But despite having a hearing in August last year the charity is still waiting for a decision.

This lengthy delay could have dire consequences; the charity may need to shut down some of its services or even close altogether.

Direct Help and Advice has made numerous attempts to push for a decision, writing several letters to the bank, but has so far failed to reach an outcome. It is now accusing RBS of using stalling tactics:

“We have little choice but to assume that RBS is deliberately delaying giving its decision in the hope that we will go away or go under; either way it will get them out of paying any compensation,” comments Rafe Nauen, Chair of Trustees at the charity.

“We are a small charity and being continually held at arms’ length by the bank makes it very difficult for us to plan ahead properly. It is a classic case of the little man versus the big institution.”

Simon Cottrell is the senior partner at Goldsmith Williams. His firm is helping many businesses recover redress for mis sold interest rate swaps and tailored business loans:

“It is so sad to hear of any business being denied a fair chance of survival but when that business is a charity it is an even bitterer pill to swallow.

“Mr Nauen makes an excellent point when he describes the situation as ‘the little man versus the big institution’. But as the story of David and Goliath shows, it is not the stature of the man but the weight of the stone they have at their disposal.

“Given that the charity has written to the bank itself, it is fair to assume that they have taken on this challenge alone. However by seeking specialist legal representation, businesses arm themselves with a boulder rather than a pebble.”

Click here for more information about interest rate swaps mis selling and how Goldsmith Williams could help you make a claim.

Content correct at time of publication