Interest Rate Hedging Compensation Claims

Was your business the victim of the interest rate swap mis-selling scandal?

We can help you claim compensation you are entitled to. Simply call our Specialists now on FREEPHONE 0800 1404544.

The Scale of the Interest Rate Hedging Scandal

It’s been estimated that around 28,000 small and medium-sized British businesses were sold inappropriate financial products – Interest Rate Swap Agreements [IRSAs] or other forms of Interest Rate Hedging Products [IRHPs] prior to the economic crash by a range of British banks including Lloyds, Barclays, HSBC, Royal Bank of Scotland,the Clydesdale  and Yorkshire Banks, Allied Irish Bank, Bank of Ireland, the Co-op Bank and  Santander.

Compensation is available in theory to any firm that was mis-sold this kind of interest rate swap product – provided that the swap was worth under £10 million.

In fact a pilot study undertaken by the Financial Conduct Authority and the major banks estimated that there was evidence of mis-selling in over 90% of cases involving interest rate hedging swap products.

Since the scandal came to ligh t in 2012, approximately 14,000 of these businesses have received compensation totalling £1.9 billion – which includes payments of £400 million to cover compensation for “consequential loss”.

Your Interest Rate Swap Claim – How We Can Help You

Whether you run a business that was sold one of these interest rate hedging products, or you are an accountant whose clients have lost out through one of these schemes, we can help you in the following ways;

  • We can help with the financial conduct review of your interest-rate hedging product – both with regard to recovering the basic redress – and further compensation for what is referred to as “consequential loss”.
  • We can advise you whether you should simply accept the redress offer made by your bank – or whether we believe the level of offered compensation is insufficient and worth challenging
  • A one-stop shop. Our in-house forensic accountant can calculate your losses which came out of both the excessive interest rates you may been charged – and any consequential loss – i.e. the additional impact this product may have had on your business
  •  We offer “conditional fees”, or no win no fee arrangements as they are more commonly known, for  appropriate cases – although these no-win no fee schemes will exclude disbursement payments  e.g court fees, accountancy costs and barrister’s charges [unless your barrister agrees to act under a no-win no fee scheme].

Should I Rely on the Offer of Redress? The Need for Independent Legal Advice

Many businesses do without independent advice and simply rely on the independent review team appointed by the relevant bank. However we believe some of the offers of redress are simply inadequate. But don’t take our word for it.

Members of the government’s own Treasury Select Committee have expressed concerns about the scheme. Committee chair Andrew Tyrie said in a statement in early 2015:

 “SMEs mis-sold these complex products need to be confident that banks will deliver prompt and fair redress through the FCA’s review scheme for IRHPs [interest rate hedging products]. Firms feel that they have been doubly let down: first by mis-selling and now by the redress process. They may have a point. The Committee remains seriously concerned about the scheme’s effectiveness and lack of transparency. The FCA needs to do much more to demonstrate that this process is credible and has not unduly favoured the banks.”

What’s more, Direct Help and Advice, a Derrby based charity has accused RBS of “dragging its heels” in paying it compensation for mis-selling one of these products.

What Is Consequential Loss? What Can I Claim for?

The type of financial loss which you may be to recover compensation for under the heading of “consequential losses” include:

  • Loss of Profit
  • Loss incurred on a sale of company shares
  • The costs of going into administration costs (including redundancy costs, lost assets, professional’s fees)
  • Lost opportunity costs ( eg missed opportunities and loss of staff)
  • Loss of goodwill or reputation

Every redress offer made by one of the banks participating in the scheme is supposed to have 8% pa interest added – which is suppose to compensate customers for their lost opportunities. If you believe you can show that your losses caused by your IRHP were more than that 8% per year rate, you could be entitled to claim compensation for consequential loss.

Sold a Toxic Interest-Rate Swap? No Need to Be Embarrassed

If you didn’t take independent advice for taking on one of these extremely complicated financial products, there’s no reason to be embarrassed. Your regular accountants and IFA’s probably would not have been in a position to give you detailed advice about the highly complex schemes – which for a huge number of British businesses, were highly inappropriate.

The products were aggressively sold without any real attempt to make customers aware of the real financial implications – nor of the excessive exit fees that were usually charged.

Many businesses suffered huge losses as a direct result – and some businesses were even destroyed as a direct result of these toxic products.

Considering an Interest Rate Hedging Compensation Claim? Contact Us As Soon As Possible

For a FREE no obligation phone consultation about claiming compensation for the losses you suffered under an interest-rate hedging product, contact our specialist Solicitors now on;

  • FREEPHONE 0800 1404544 or
  • Email our team using the contact form below