Where is my swaps claim up to?
Just ten offers of redress for interest rate swaps mis selling have been issued and accepted, according to new figures from the Financial Conduct Authority (FCA).
As of the end of August, 10 offers of redress have been accepted with payouts totalling £500,000, the FCA confirmed. It is believed a further 210 offers have also been made whilst another 1700 expected to go out imminently.
Martin Wheatley, Chief Executive at the FCA, comments:
“With 85 per cent of cases now under review, banks have made progress. But like the thousands of affected small businesses, we want to see redress paid quickly to those who have suffered loss as the result of mis selling.”
Simon Cottrell, Senior Partner at Goldsmith Williams Solicitors, is less than impressed however:
“Considering the FCA first began its investigation into the sales practice of interest rate swaps in June 2012, I’m not entirely sure how 10 offers of redress can be described as progress.
“At this rate, with over 30,000 sales to review, we’ll be lucky to see every claim settled in our lifetime!
“I am pleased to report though that Goldsmith Williams clients are seeing real progress with the firm having already received offers of compensation on behalf of clients.”
Consequential Loss Claims
The apparent cause for these significant delays is the complexity of the vetting procedures and calculation of consequential losses.
The second stage of the FCA process will involve a claim for Consequential Loss (if applicable). A client will be required to submit a Consequential Loss Report and Schedule of Losses. There will also be a second meeting with the Lender. This agenda will be a recorded meeting and the Independent Reviewer may be present.
Simon Cottrell continues:
“We do not consider it appropriate for a client to draft a Consequential Loss Report as financial expertise will be required. Just like with the original fact find meeting, clients should not attend any meetings in relation to consequential losses with due preparation and specialist legal representation.
“Those who do run the risk of damaging their chances of redress and with consequential loss claim, in some circumstances, accounting for three times the amount of a direct loss claim, this could be an extremely costly error.
“Goldsmith Williams can help SMEs avoid such a situation and help them recover as much as possible including consequential losses.”
Content correct at time of publication