Although thousands of sales have been determined by the banks to have been mis-sold, very little has been paid to SMEs for the consequential losses that they incurred.
The banks are determining in thousands of cases that, although an SME suffered substantial damage to its P&L both as a direct result of the mis-sold IRHP and as a result of the additional costs that the banks were able to impose, no consequential loss was ever incurred.
So absolute are the banks in their determination not to pay any consequential loss that they even exclude legal costs incurred by the SME in disputing the legality of the IRHP.
Never before have our advisors encountered any firm of solicitors or any barrister who maintained that legal fees incurred to successfully dispute the sale of a product are not consequential losses arising out of the mis-sale. But the lawyers working for the banks adopt this extraordinary position in thousands of cases.
Other obvious consequential losses that the banks refuse to acknowledge are additional charges that the banks were able to impose as a consequence of the damage to these SMEs caused by the costs of the IRHPs.
In addition it is obvious that if a business’s costs are dramatically increased and as a result it cuts back on marketing or refurbishment or development expenditures it will suffer losses. The banks totally disregard these consequences.
They are able to do this because, in a parody of an impartial process of fair review, those who mis-sold the product are the party determining the consequential losses that flow from that mis-sale.