Ever since the agreement between the FCA (then FSA) and the four major high street banks was first announced in 2012 to great cheer by those trapped in IRHPs, the million dollar question has always been will it provide fair and reasonable redress to the people and businesses mis-sold interest rate hedging products (IRHPs)?
Almost from the very outset criticisms were raised about the review, many of which have never been fully answered.
Common concerns were:
- How can it be that the banks that mis-sold the products can be allowed to conduct the review of the mis-sales?
- How much scrutiny would the independent reviewer appointed by the banks actually apply?
- Why have the terms of the review never been made open to public inspection?
- How can any complainant be sure that they have been fairly treated under the process when it has very limited input into the process?
To many complainants these legitimate concerns were never properly addressed and nearly always the assurance given by the banks was that the independent reviewers appointed by the banks were there to ensure that the banks acted properly and that any decision on redress would need to be first approved by the independent reviewer and therefore the outcome would always be fair and reasonable.
In short the banks stated the independent reviewers would act as a failsafe for any decisions made under the review.
So far, so reassuring.
However I was recently approached by a client who had been through the FCA Review process and had been refused any redress in relation to the IRHP sold to it by the bank. The bank and the independent reviewer had both reviewed the case and formed the view that redress was not due. Our client firmly believed it had been mis-sold the IRHP and was naturally disappointed.
Not satisfied with this, our client asked us for a second opinion and on a close inspection of the papers, it appeared apparent to us that there had been a number of regulatory failings.
On this basis we made substantial submissions to the bank and the independent reviewer on behalf of our client pointing out these failings… and within weeks of sending this to the bank our client received a revised offer providing substantial redress and our client was delighted.
What is not yet clear is if this is a one off incident or part of a range of broader failings between the review process and the independent reviewer.
What is clear is that if you have been refused redress under the FCA Review this may not be the correct decision and you are strongly advised to seek legal advice on the merits of your claim either through the FCA Review scheme or litigation. Ultimately, it may well be possible to receive redress even in circumstances where the bank and the independent reviewer have both reviewed your case and stated they believe there was no mis-sale.
Slater and Gordon has advised on a multitude of IRHP disputes within the FCA Review scheme, through litigation or complaint through the Financial Ombudsman Service.
Slater and Gordon have offices in London, Manchester, Liverpool, Sheffield, Bristol, Birmingham, Milton Keynes, Cambridge, Cardiff, Edinburgh, Newcastle, Halifax, Wakefield & meeting rooms in Bramhall, Cheshire.