Precision Claims Reacts to Record Fine for HSBC after Mis-selling Investment Bonds
Precision Claims response to the news over HSBC receiving a record fine of £10.5 million by the Financial Services Authority due to the mis-selling of investment bonds to elderly people in care homes.
Precision Claims have spoken out after it was confirmed HSBC had received a fine of £10.5 million by the Financial Services Authority (FSA) over the mis-selling of investment bonds to elderly people in care homes.
The investment bonds were sold by a subsidiary of HSBC known as NHFA, previously known as the Nursing Home Fees Agency. They advised 2,485 elderly people with an average age of 83, who were about to enter, or already in, long-term care to buy into five-year bonds to fund their care as a way of getting a return on their savings to ease the cost of their nursing care.
However it was concluded by the city regulator that the majority of these customers, who on average invested £115,000 and in some cases would have sold their property to provide the cash, were deemed unsuitable for the product.
The bonds were invested in the stock market and required that investors commit their money for a minimum of five years. However the NHFA salesmen did not take consideration of elderly people’s life-expectancy when selling them investment bonds and in many cases investors had a life-expectancy shorter than the period of the bond. In order not to lose their money on death, they had to withdraw cash before the bond matured and thereby suffered heavy withdrawal penalties.
Simon Thompson, managing director at Precision Claims, a firm specialising in helping residents and their families reclaim care home fees , responded to the news , “The bank’s sales staff should have advised clients that the product would only work if they survived the whole investment period. it is a clear case of deliberate mis-selling for monetary gain. We not only should take better care of the older members of our society, we should punish those who seek wilfully to mistreat them.”
The bank will now have to repay £29.3 million back to customers who were mis-sold the bonds as well as paying them compensation, bringing the total cost to almost £40 million.
Thompson added “It is really important that the victims of mis-sold bonds get the right advice from a legal claims specialist to make sure no mistakes are made when applying for compensation. We regularly help families’ pursue both financial services compensation claims and care home claims on a no win no fee basis.”
Precision Claims specialises in helping people pursue compensation for mis-sold investment bonds and care home claims. Visit http://www.precisionclaims.co.uk for more information about the full range of legal services the firm provides or call 0844 704 1945 for a free enquiry today.
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