Since the publication of our Briefing Note earlier this month on the Financial Conduct Authority’s (FCA) review of the sales of interest rate hedging products, it has been reported that Lord Sugar has now emerged as the most high profile victim to date of mis-selling.
The Lloyds Banking Group has received a letter of complaint from Lord Sugar over its sale of a hedging product on a loan taken out against part of his property empire. He is seeking the return of about £10m in break fees paid to Lloyds to cancel the interest rate hedging contract. The derivative is understood to have been for £97m and was taken out to protect against a rise in interest rates on a Lloyds loan.
As a “sophisticated customer”, Lord Sugar is not eligible for redress under the FCA review and it is reported that he is understood to be considering legal action should his complaint be unsuccessful.
With compensation funds of up to £1.5bn being put aside by the banks, we expect many more high profile cases of mis-selling to emerge.
If you think you may have been mis-sold an interest rate hedging product, please email lawyers@rooksrider.co.uk for advice or assistance.
