Member Article

Businesses to challenge Interest Rate Hedging Product compensation decisions

’Act quickly before your case is closed’

Businesses hit by the mis-selling of Interest Rate Hedging Products (IRHPs) need not blindly accept any outcomes they see as disappointing from the Financial Conducts Authority’s (FCA) Review process.

FCA figures show that of 14,549 redress determination letters sent by the banks at the end of June 2014, there were 2,523 cases involving one hedging product being replaced with another hedging other than a cap, which can significantly reduce the amount of redress offered, and a further 1,081 cases with no redress at all.

However, an ‘inbuilt appeals’ mechanism within the FCA redress scheme means that it is possible for businesses that have been refused compensation to have their decision overturned.

Daniel Hall, Managing Director at the claims specialist All Square says businesses can challenge adverse decisions if they believe they have grounds to do so – but he emphasises that if they want to do that there is no time for delay.

“It’s crucial to act quickly before the case is closed,” said Hall.

“It’s important for business owners to keep in mind that an adverse determination isn’t necessarily the end of the matter. There is an appeal process overseen by the FCA that enables businesses to challenge the bank’s decision not just based on the provision of new information but even if you disagree with the rationale of their decision.”

Under the FCA’s rules, the redress determination letter should set out how the decision has been reached as well as giving business owners the option of attending a face to face meeting at which they can obtain a more detailed explanation from their bank.

Daniel concludes; “All Square currently acts for a number of businesses in the FCA appeals process and – with more turning to us for help every week – there’s plenty of evidence that business owners are unhappy and looking for assistance in challenging the banks’ decisions.”

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