Banks and other financial institutions have been embroiled in a series of scandals over recent years resulting in damaging publicity, significant litigation and also eye-watering fines from Regulators.
The Financial Times recently reported that banks and other financial companies had to pay more than £12,000,000,000 (£12bn) to settle legal and regulatory disputes in 2014. This represents an 18% increase on the already huge costs incurred in 2013.
The fines look set to continue this year with Barclays reportedly being hit by the largest financial penalty ever imposed by the FCA/FSA for failures relating to themanipulation of forex markets.
Georgina Philippou, the FCA’s acting director of enforcement and market oversight said:
“This is another example of a firm allowing unacceptable practices to flourish on the trading floor. Instead of addressing the obvious risks associated with its business Barclays allowed a culture to develop which put the firm’s interests ahead of those of its clients…”
Some banks have developed a thick skin in relation to the adverse publicity that they have attracted over recent years, but the continuing escalation in fines (as part of the FCA’s strategy of credible deterrence) could have significant long term effects.
Banks have also been heavily criticised for their behaviour in and around the credit crunch and many of those issues are only coming to light now.
For individuals and companies who have been the subject of aggressive conduct by banks or mis-sold financial products, it is often necessary to resort to litigation. These claims can be complex and, to succeed, claimants may have to make new law. In an environment where banks are able to afford the most expensive City lawyers, it is important that claimants have a capable and experienced legal team behind them.
For more information on this matter, or other complex financial and tax disputes, contact Alistair on 0113 220 6271.