Permission Granted in IRHP Redress Judicial Review

24/04/15

Following a full day hearing, the Administrative Court (Kenneth Parker J) has today granted permission for a judicial review challenge to the process followed by an ‘independent reviewer’ appointed to oversee the exercise of a redress scheme operated by Barclays Bank in respect of mis-sold Interest Rate Hedging Products (‘IRHPs’).

In 2012, following the discovery of serious and widespread failings in the sales of IRHPs by a number of large United Kingdom banks, the Financial Services Authority (now the Financial Conduct Authority), reached an agreement with the banks to provide appropriate redress where mis-selling had occurred.

Pursuant to the agreement, each of the banks agreed to establish a redress scheme under the oversight of an ‘independent reviewer’ approved by the FCA as a “skilled person” pursuant to section 166 of the Financial Services and Markets Act 2000.

The Claimant, Holmcroft Properties Ltd, sought permission to bring judicial review proceedings challenging the process which was followed by the ‘independent reviewer’ (in this case, KPMG LLP) in respect of its review of the redress proposed by the Barclays in respect of consequential losses caused by the mis-sale to it of certain IRHPs.

The Independent Reviewer, supported by the Financial Conduct Authority and Barclays resisted the grant of permission for the claim to proceed. 

In his judgment, Kenneth Parker J found the Claimant’s claim that the Independent Reviewer was amenable to judicial review, and that the process which was followed was unfair and/or unlawful, to be sufficiently arguable to justify the grant of permission.  The matter will now proceed to a substantive hearing.