The term ‘Interest rate hedging product’ refers to a number of financial products which have as one of their object the management of exposure to interest rate fluctuations.
In recent times they have been sold to small and medium-sized enterprises (“SMEs”), in many cases inappropriately.
Many SMEs found that after entering into these products, interest rates began to fall and continued falling which meant that they faced greatly increased monthly repayments. When bank customers looked for a way out, they were then informed that they would be charged significant ‘break costs’ if they wanted to exit these products. A common theme to the complaints which followed was that customers were informed of the benefits of these products, but not of the associated risks and pitfalls if interest rates fell.
In the summer of 2012 the FSA (now called The Financial Conduct Authority - 'FCA') agreed with a number of banks that there would be a review of sales of certain categories and products to certain types of customers and that the banks would provide "fair and reasonable redress", where applicable the banks launched a pilot review. For further detail about what has emerged from the review can be found on our blog.
At Clarion we are dealing with a number of high value mis-selling claims for our clients and from our experience there are a number of recurring issues which can arise in mis-selling claims – we have produced a more detailed fact sheet on this subject. To receive it please email firstname.lastname@example.org.
If you wish to pursue a mis-selling claim against your bank and to understand your options, we recommend in the first instance that you contact our specialist team.
For more information please contact:
Simon Young, 0113 222 3206 email@example.com
John Mackle 0113 336 3336 firstname.lastname@example.org
Dominic Blakeley 0113 336 3365 email@example.com
Disclaimer: Anything posted on this blog is for general information only and is not intended to provide legal advice on any general or specific matter. Please refer to our terms and conditions for further information. Please contact the author of the blog if you would like to discuss the issues raised.