Independent review of swaps mis-selling
Many banks have reached an agreement with the Financial Services Authority to voluntarily review any swaps/collars/caps sold to non-sophisticated customers in the last 12 years.
Further the banks must appoint an independent reviewer to see if their proposals for settlement are fair and reasonable. Critically the banks have committed to make fair and reasonable redress to non-sophisticated customers who were sold structured collars. If you think you may be affected by these issues there is extremely useful guidance published by the FSA in their document ‘Interest rate hedging product questions’ .
If you are not happy with the result of the review then you may be able to complain to the Financial Ombudsman Service. If you are not happy with the Ombudsman’s decision then you may still pursue court action. This begs the question of if or when should you take legal advice. The agreed review process does not affect the application of the Limitation Act 1980 and some rights of action may become time barred during the period of review. If that is the case then those affected should take legal advice without delay.
If time is not an issue then in theory the agreed process may allow SME’s to recover fair and reasonable redress without the need for legal advice. It is not yet clear whether the process will deliver satisfactory outcomes and how long it will take for an SME to receive redress.
If you have any questions about these issues please contact Jonathan Waters using the links and buttons below.
Jonathan Waters is the founder of Helix Law. Before qualifying as a Solicitor he worked in industry and in investment banking for over a decade. He was also the Partner in charge of Commercial Litigation, Employment Law and Property Litigation at Stephen Rimmer LLP. Jonathan has wide experience of helping and advising businesses to avoid or to deal with commercial disputes and in particular construction disputes.
This article is written to raise awareness of the issues it discusses and it may not be updated after it is first written, even if the law changes. It is not intended to be legal advice and cannot be relied on as such. Helix Law is not responsible or liable for any action taken or not taken as a result of this article. If you think the matters set out affect you and you wish to apply them to your particular circumstances then we are happy to give you free initial telephone advice.