Labour Party chief Ed Milliband (Photo: Reuters)
Labour Party's leader Ed Miliband has homed in on victims of the mis-sold derivatives scandal by highlighting a small company who he said had been "fleeced" by his bank in a passionate speech aimed at reconnecting with his party.
Miliband told the Labour party conference in Manchester that Alan Henderson and his wife Julie, who run a sign-making company in Putney, southwest London, were "living a nightmare" and were "ripped off by their bank," after they tried to secure a simple five-year loan, but instead were also sold an interest-rate dual amortising swap product.
The interest rate derivative product is also a 10-year agreement, meaning that even five years after they have paid back their loan, they will still be making payments to the bank on the swap if interest rates stay low.
In a speech made in July, Miliband also highlighted the Hendersons' plight as a sample of hundreds of other businesses across Britain.
"We can't have a situation where people like them, who have so clearly been fleeced in the most reprehensible way, are excluded," he said.
"The FSA is going to have to widen its remit to make sure they are included in any compensation and in any inquiry into what happened." The inclusion of the Henderson case in the Labour party conference speech highlighted the growing concerns of politicians over banks mis-selling complex derivatives to small-to-medium (SME) business owners.
IBTimes UK exclusively revealed that Labour was officially putting pressure on the Financial Services Authority (FSA) to look again at the agreement it made with the banks over the mis-selling of derivatives. IBTimes UK was shown a signed letter from Labour's shadow financial secretary to the Treasury Chris Leslie to the FSA's managing director Martin Wheatley expressing serious concern over the regulator's deal and the lack of an appeals procedure in the mis-selling of interest rate swaps.
The coalition is ramping up efforts to look into the mis-selling scandal after business secretary Vince Cable sent his most senior colleague from the Department for Business Innovation and Skills to Bully-Banks lobby group's conference, just one day after the UK regulator was forced to revise up the estimate of the number of businesses possibly effected by scandal.
The Parliamentary Banking Standards Commission has also conducted a committee hearing in recent weeks, to gather evidence from expert witnesses in the industry to discover the scope and scale of the scandal.
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