BACKBENCH MPs have urged the financial watchdog to quickly crack down on the mis-selling of interest rate swaps to small businesses.
Conservative MP Guto Bebb told parliament that thousands of small firms have bought products to insure against interest rate changes without a proper explanation of the risks, with evidence of hard-sell tactics and misrepresentation.
“[I]n the current economic climate we should not accept the loss of any businesses or jobs as a result of mis-selling,” he said.
Caroline Nokes MP said one of her constituents who had lost substantial sums in a swap said they “would have been better off going to Wonga”.
Bebb said he expects the Financial Services Authority to produce a report on the matter by the end of July, and called on them to clamp down on instances of mis-selling as soon as possible.
The Federation of Small Businesses backed the debate, saying in a statement: “The last thing banks need now is another mis-selling scandal.
“But exposing it is the only way of dealing with the problem effectively.”