An inquiry by the FCA into mis-sold small business loans could drag on for a further six months. The redress scheme aimed to compensate firms for the mis-selling. However, since its launch, companies have been unhappy about their offers of compensation, with many more filing legal suits against their lenders. One unnamed barrister said he is currently working on about 25 cases. “The scheme will not be closed for a long while. There are people seeking legal advice every other day,” he said. The FCA has yet to comment on how much longer the review is likely to take, it added that more than £1.5bn has so far been paid to 10,000 businesses.
Source: The Sunday Times
Rather than concentrating on the amount of redress that has been paid to however many companies, the FCA should instead be addressing how many companies are still in the review scheme and how many companies have filed legal suits against the banks for failing to properly offer appropriate financial redress for mis-sold interest rate hedging products. The review scheme has not worked as strict deadlines were not imposed and numerous companies have still not been dealt with fairly by the banks under the review scheme despite the banks appointing so-called independent reviewers. The FCA must take the blame for the failure of the scheme they agreed with the banks and are duty bound to resolve remaining issues in a timely manner.