Banks across the UK need to do more to regain the trust and confidence of individuals and businesses, the Bank of England (BoE) has said.
The BoE recently stated that banks must do more than just pass health checks on their ability to withstand financial shocks and instead prove to customers that they are acting in their best interests. The distrust stems from the mis-sold swaps scandal that took place during the height of the recession, in which many businesses were sold financial products designed to protect them against interest rate rises only to lose out significantly when interest rates actually fell.
It is a problem that has hung like a heavy, dark grey cloud over the heads of British bankers for the past five years and it is one that the forensic accounting experts at Frenkels Forensics have assisted many clients with in recent months.
The Financial Conduct Authority (FCA) ordered that banks set aside £4 billion to pay people back for the mis-sold swaps, but less than half of this money has been claimed. Why? Because people are either unaware they are eligible for it or they are too busy and too confused to make a claim.
And it can be confusing; firstly there is the basic redress, which offers a repayment of the costs of the financial product that was wrongfully sold to them in the first place. Secondly there are repayments for consequential losses; these can be at a flat rate of eight per cent, a flat rate of eight per cent plus pocket losses or a calculated loss of earnings.
Calculating consequential losses can be tricky – this is where the experts at Frenkels Forensics come in handy, ensuring a claimant receives every penny they deserve by completing a thorough examination of the accounts and charting this against the potential earnings a business or individual has missed out on due to the financial products they were mis-sold by banks.
For help in claiming on mis-sold hedging products contact Frenkels Forensics for an independent appraisal.
By Vitek Frenkel – find me via Google+.