Question to the HM Treasury:

To ask Mr Chancellor of the Exchequer, for what reason the Financial Conduct Authority does not include professional fees when assessing the amount of compensation which should be paid to people who have been mis-sold policies.

The Government has been very clear that the mis-selling of financial products is wrong and it is important that those businesses that have been affected are appropriately compensated.

The Financial Conduct Authority is an independent regulator and the Government does not have any involvement in how the FCA decides to conduct its investigations.

In the case of the FCA review into the mis-selling of interest rate hedging products, the decision on whether there should be a separate appeals process was one for the FCA to take.

It is important to note, however, that the role of the independent reviewer who oversees the review of each case is to ensure that the process is fair and businesses have adequate opportunity to put forward their case.

Furthermore, eligible businesses with a turnover of less than €2 million and fewer than 10 employees also have recourse to the Financial Ombudsman Service (FOS) if they are not happy with the outcome of their review.

Regarding the inclusion of professional fees in compensation packages, the FCA’s view is that redress should be fair and reasonable in the circumstances. This is consistent with the way the FOS awards compensation. As such, it may be appropriate for compensation to include professional fees in some situations