Cable refers HBOS to FSA

BUSINESS secretary Vince Cable yesterday threatened HBOS with a regulatory probe relating to the bank’s role in the collapse of Christmas savings firm Farepak.

Cable said he would refer HBOS to the Financial Services Authority (FSA) after a high court judge said it was the bank’s decision to extract around £10m from Farepak that pushed the firm into administration.

In an usual move, Mr Justice Smith last week said that although HBOS – now part of Lloyds Banking Group – acted legally, the bank should “seriously consider” the moral case for providing additional compensation to victims.