Continuing confusion over SWAPs mis-selling redress may cause catastrophic delay
The publication of the Financial Conduct Authority update on the banks’ reviews of sales of interest rate hedging products provides valuable information to illuminate recent media reports regarding SWAPs mis-selling redress payments, but at the same time it raises a number of questions of its own.
‘The FCA report looks at the progress made so far within the official scheme’, commented Simon Cottrell, Senior Partner at Goldsmith Williams Solicitors – a leading firm specialising in this field.
‘Scrutiny of this review raises a number of questions, for example, 50% of those eligible for the scheme have yet to opt in. From experience talking to our clients we feel that many of those in receipt of the invitation to opt-in may not appreciate the significance of this - which may explain the low participation rate. Indeed this statistic does beg the question why wasn’t the scheme designed with an opt-out rather than an opt-in? Our concern is that time is ticking away and for some time-barring is becoming an issue.
Further, the report shows that an initial redress outcome has been communicated to 213 customers of which 179 have been offered redress, yet only 10 offers have been accepted. Even with our intimate knowledge of the process it is difficult to understand why this number is so low; however it may be due a delay over considering consequential loss.
A number of our clients businesses are on the brink, such a delay could be catastrophic.
The reports in the media over the last few days paint a starkly contrasting picture. On the one hand we’ve seen reporting of these 10 payouts under the FCA scheme averaging £50,000 redress, whilst on the other hand there are reports of some 70 out of court settlements with an average claimant package of £1.5m. These mixed messages also contribute to confusion about how to go about securing redress.
Our approach is client-centric. We consider every case individually and all the options open to the client. For some the best approach is to go through the FCA Scheme, with our support. This gives them control over the process and a better outcome than going-it alone. For others litigation is the only way to get access to justice and secure adequate compensation. Either way – time is of the essence, the statute of limitations will impact upon some of these claims so we urge business owners caught up in this to instruct a lawyer without delay!’
Content correct at time of publication