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The FSA has accused Britain's largest banks of selling small businesses "absurdly complex products" and said that lenders will have to compensate thousands of customers......Read more here
Previous AAD Blog pages Sept 2012: FSA told to start compensation process for mis-sold customers - allaboutFORUMS
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The big four High Street banks have been ordered to begin reviewing all interest rate hedging products they may have mis-sold to small businesses. The Financial Services Authority (FSA) said Barclays, Lloyds, HSBC and RBS would seek to identify and provide redress to all customers affected. The FSA's announcement follows its own review of 173 such sales last year, of which more than 90% broke regulations.....Read more here BBC News - Banks to begin small business hedge mis-selling review
The government and regulators are exploring a major expansion of the compensation scheme for small business mis-sold interest rate swaps as they consider the inclusion of fixed-rate loans. The Financial Services Authority and the Treasury have begun discussing the problem of unregulated commercial loans that contain embedded interest rate derivatives that have led to complaints from businesses such as farms and small property developers about huge breakage costs they say they were never warned about. Vince Cable, the Business Secretary, is set to take up the issue directly with the FSA and told The Telegraph he was aware that the problem of fixed-rate loans could be "akin to swaps mis-selling"......Read more here
The new regulator, which has taken on part of the work previously handled by the Financial Services Authority, is expected to receive documents tomorrow detailing the concerns of a group of medium-sized businesses which argue they have been shut out of the redress process. To date, British banks have been forced to set aside more than £2bn to cover the cost of compensating victims of swaps mis-selling, with Barclays having made the largest provision of £850m. In legal documents seen by The Sunday Telegraph, the businesses, which have formed an action group, have despatched a “letter before action” to Martin Wheatley, the FCA’s chief executive. The action group, which has been brought together by law firm Manches, alleges the FCA is running a compensation scheme which excludes many businesses.....Read more here