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Draft Following Up Article On Interest Rate Hedging Products

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As the Financial Conduct Authority Review finally begins to gather some momentum, increasingly those customers who fall within the auspices of the Review are being invited to engage in the Review process.

hlw Keeble Hawson logoIn particular banks are giving customers the opportunity of either attending a “face to face” meeting (with the bank and its lawyers) or participating in a telephone fact finding call or providing written submissions.

Early indications are that as a general rule complainants fare better when they attend in person at a face to face meeting. The prospects are further enhanced if they and their advisers have prepared suitably for such meeting.  

Preparation for these Review meetings is critical.   It should be borne in mind that in many cases these Review meetings are recorded and discussions can be referred to in subsequent proceedings.  It is important therefore to present one’s case in as strong a manner as possible.

We would recommend that well in advance of the meeting a complainant gathers together all documents, letters, emails etc and speaks to all relevant personnel to obtain their recollections of the history.  It is then usually worthwhile preparing a chronology of events.  The aim will be to put oneself in a position where you can “tell the story” from start to finish including:

  • Your circumstances prior to purchase of the hedging product
  • The circumstances in which you entered into the product
  • Why the product was entered into
  • What you were told/advised about it (and by whom)
  • What they understood the product was
  • The actual effects of the product
  • Why the product wasn’t right for you
  • To what extent the effects of the product were different from what the bank had led you to believe?
  • What losses have been suffered as a result (these might include direct losses such as interest and exit fees paid but also indirect losses insofar as opportunities have been missed as a result of being financially hamstrung by these products).  Sometimes it is necessary to seek assistance of a forensic accountant to quantify these.
  • You should be ready to refer to any documentation which illustrates the above points as this will make them all the more powerful
  • Similarly consideration should be given where there is documentation which could be potentially harmful to your claim, to explaining this away.

t really is a case that the more effort you put in to preparing for these Review meetings the more chance there is of a favourable outcome.  

If you have any questions or concerns about the issues raised by this article please contact Michael Peacock on 0114 2906287 or Rachel Crookes on 0113 3993460 in our litigation team.

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