FSA Orders Banks to Pay for ‘Swap’ Mis-Selling — FinspreadsFebruary 4, 2013
LONDON–(Marketwire – February 4, 2013) – Finspreads: Four banks have been told by the Financial Services Authority (FSA) to compensate thousands of small businesses for mis-selling complicated insurance deals.
The FSA found that 90 per cent of the deals sold to smaller clients broke at least one rule.
Around 40,000 “interest rate hedging products” (IRHPs) have been sold to such clients since 2001.
The decision to order banks to deliver compensation was made last summer.
The FSA has told the four big banks involved to work out how much their customers lost.
But the Federation of Small Businesses (FSB) has already expressed concern about how payments to the banks have not been automatically suspended, with there seeming to be no clear way for businesses to appeal if refused compensation.
It comes on a sluggish day of trading in London for some of Britain’s biggest banks.
At 1449GMT on the FTSE 100 Barclays, HSBC, and the Royal Bank of Scotland all made declines of 1.49, 0.58, and 2.19 per cent respectively.
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