A UK finance minister has been criticized for dealing with the problem of bankruptcy

The UK Treasury has not done enough for banks to respond to a $ 2.2bn interest rate hike wrong sale which started 20 years ago, and used the wrong methods to exclude other clients from the remodeling process, an independent review has found.

John Swift QC Report printed On Tuesday he strongly criticized the Financial Services Authority, which headed the Financial Conduct Authority, for not being fully visible to customers affected by the scandal and for giving undisclosed periods of long-term restructuring.

Swift’s comments also highlighted how the supervisor handled fraudulent sales transactions between 2001 and 2011 and the compensation system.

An expert in the field said the main difference between the harassment and the review of the rules was the complexity of the report and the amount of impact, the last of which was released by December 2020.

The FSA was tasked with overseeing nine banks that had wrongly sold tens of thousands of small businesses to interest rates that left them with huge debts when interest rates plummeted. The FSA was abolished in 2013 and the FCA took over its role in the UK financial sector.

Swift found that most clients who are eligible to manage things went smoothly than they would have been without them, but pointed out a number of shortcomings. This also included the failure of the FSA and the FCA to investigate the compulsions of the banks involved.

“The FSA / FCA must have thoroughly investigated the cause of the illegal trade before finalizing the enforcement action,” the report said.

It added: “With the benefit of this research project, the FSA / FCA would have had the opportunity to see if it acted in addition to [compensation] policy and, if so, to ensure accountability. ”

The review also found that the FSA “fell under the appropriate transparency process” as it set out the restructuring process, especially by failing to question how it was designed. This includes not telling the public that the final plot “deviated” from the original plan of the regulator concerned.

Swift also criticized the FCA and its executives for not including the $ 10,000 in 30,000 cases in reviewing the tear-jerker system based on the “stable idea” if the customers had the knowledge and experience to buy swaps.

The FSA and the FCA were also criticized for giving people unlikely to take too long to review what was done – in January 2013 the regulator promised it would take 12 months to complete but the work lasted until the end of 2015..

The illicit sale affected nine banks, including Royal Bank of Scotland, Bank of Ireland, Barclays, HSBC, Lloyds, Allied Irish Banks, Clydesdale & Yorkshire Banks, Co-operative Bank and Santander UK.

In his remarks, the official said it was not wrong to remove the leading customers in the compensation process. As a result, the FCA will not attempt to use its powers to seek redress elsewhere [interest rate hedging product] customers, ”it added.

FCA chairman Charles Randell, who is stepping down next year, emphasized that the FCA was “as different from the FSA as it was when the goods were sold and when it set out the restructuring process,” adding: “We look forward to action. Sooner and later.”