FOS rule West Brom Tracker Rate Hike is fair

by Mark Alexander

3 years ago

FOS rule West Brom Tracker Rate Hike is fair

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FOS rule West Brom Tracker Rate Hike is fair

The FOS (Financial Ombudsman Service) have done it again! FOS rule West Brom Tracker Rate Hike is fair

In the past the FOS have controversially agreed that rate hikes applied by Bank of Ireland, Skipton Building Society (Amber Homeloans) and also the Danske Bank (formerly National Irish Bank) were fair. Therefore, is it really that shocking that FOS would also rule in favour of West Bromwich Mortgage Company?

Following a judicial review in the case of Millar & anor -v- Financial Services Ombudsman [2014] IEIC Mr Justice Garard Hogan recently ruled that the Irish FOS were wrong in their contractual interpretation in a rate hike case that the Millars brought against Danske Bank [source1].

This supports the Property118 members’ lack of confidence in the UK FoS decision making process, and hence the decision for Property118 to raise funds to enable their members legal team to stand toe to toe on 21st January 2015 with the West Brom legal team at the Commercial Courts in the Rolls Building.

Property118 members have raised nearly £500,000 and these funds are set to grow as a result of people who complained to the FOS realising that Property118 were right all along to take a representative action to the Courts.

The National Landlords Association initially recommended its members to pursue the FOS route and await the outcome of that before considering legal action. Many of those who followed this advice are enquiring about joining the representative action organised by Property118 as a result of the FOS finding. **West Brom has indicated through its legal team that it will apply the finding of the Court across the board to all affected borrowers**, so all additional support to ensure the right result is achieved is essential.

The Property118 representative group are happy to welcome all who have received the FOS rejection letter. The same financial commitments to those who joined prior to the deadline will apply, plus a small price for the administration costs associated with Cotswold Barristers applying to the Courts to have the names of the newly represented participants added to the claim. A new deadline of 19th December has been applied, this will definitely be the final deadline for legal reasons.

Newcomers are interested in joining the fight in the full knowledge that sufficient funds have already been raised and that the case will be heard on 21st January 2015.

Each member has paid £1,000 into an escrow account held by BARCO (The Bar Council’s Escrow service) plus a further £500 to Property118 and Cotswold Barristers to cover legal costs and associated running and marketing costs of the campaign for each represented mortgage account. Some members have a dozen or more represented mortgages, most have one or two. In the event of the case being won the majority of funds will be returned, plus of course a refund of any over-payments to West Brom and the satisfaction of their terms being upheld as per the borrowers understanding of the tracker rate mortgage contracts they entered into.

Every newcomer to the Property118 reduces the financial exposure to the funds already raised on the basis that all costs are shared pro-rata to funds committed.

** Beware false promises! **

Back in 2009 the CEO of the Skipton Building Society went on record that they would honour an interest rate cap [source2] just one year before that promise was reneged upon [source3]. However, insufficient funds were raised to take the case to court and borrowers have been left high and dry by the FOS and the FCA who decided the rate hike was fair despite the promises made. Perhaps that’s why West Brom borrowers want the certainty of being represented in the Property118 vs West Brom Court case, whilst it is still such a cost effective option?

If you are affected, and are not already a member of the Representative Action, please complete the form below for more details on how to get involved.

Representative Action Information Request

 

Comments

The cynic in me feels that one of the main reasons that West Brom's legal team have indicated that the court's decision will be applied to all affected borrowers (other than to preclude a flood of separate claims after the court's decision and the associated legal costs in defending them) is to sabotage further fundraising. After all, if affected borrowers are led to believe that they will benefit from the court's decision despite not being paid up members of the legal action, there is a danger they will simply sit on the sidelines as they have no incentive to join up and contribute. The problem inherent with adopting this particular course of action (or rather inaction) is trusting the West Brom to honour its pledge to apply the court's decision to all affected borrowers. As I recall, Skipton building society once made a pledge to all borrowers that took out a SVR mortgage before promptly reneging on it.

The only way to be absolutely certain of reaping the benefit of the court's decision is to be a member of the representative action and not rely on the whims and good grace of a financial institution that has already proved itself to be both shameless and duplicitous.

Onslow Clough

3 years ago

Hi Mark I remember back at the beginning you had very little faith in the outcome of an FOS inquiry and they have lived up to these low expectations. I feel very sorry for the people who put their faith in this organisation protecting them, and would recommend that they sign up to the representative action immediately. This is where the strength is, not the FOS

Ed Atkinson

3 years ago

Well done Mark.

Could you add a sentence at the top to fill out the headline? I was waiting to read about the recent FOS ruling with date etc, but you went straight into why it is of such limited value. It meant I had to read the first few paragraphs a second time before I understood properly.

Thx Ed

Mark Alexander

3 years ago

Reply to the comment left by "Ed Atkinson" at "16/11/2014 - 17:50":

Hi Ed, the FOS response could have been written by the West Brom, I didn't think it was worthy of publication but if you really want to read more see >>> http://www.telegraph.co.uk/finance/personalfinance/investing/buy-to-let/11226776/Ombudsman-rules-that-lender-West-Brom-can-raise-tracker-mortgage-rate-without-Bank-Rate-rise.html
.

Mark Alexander

3 years ago

Reply to the comment left by "The Man From Nowhere" at "16/11/2014 - 17:49":

Spot on Sir, and probably the reason why we've received a dozen or so enquiries in the last 24 hours!
.

Andy Bell

3 years ago

FOS - Fob Off Service.

They have taken over 12 months to announce the decision they took on day one.

The cynic in me also thinks they've been in cahoots to delay people taking legal action.

Well, thankfully, it's not too late to join up. If, up to this point, you trusted the FOS - Welcome aboard!

Anon

3 years ago

We can but hope that the ruling of the Court will establish that FOS are unfit to make rulings on contractual disputes of this nature, better still if this leads to judicial reviews of their previous rulings on similar cases. I would hope that Property118 will campaign for this again at the highest level, assuming of course that the campaign group is successful in Court in January, which I'm confident it will be.

Sandra W

3 years ago

Thank goodness property118, Mark and the others got us organised take on West Brom a year ago, rather than waiting for the FOS ruling. there's still time, but don't delay, join us today!

David Pettigrew

3 years ago

I was told last week by an adjudicator that an ombudsman at FOS will now review my complaint.

Peter & Di Cole

3 years ago

We never had a great deal of hope that the dithering FOS were going to be able to make the right decision and are now even more glad that we are part of the Property118 representative action against the thieving West Brom who today took their twelfth lot of illegal increased payments from our bank account. Any fence sitters need to join our Group now if they want to see a return of their hard earned money and a stop to any more being stolen by the West Brom. Joining us is the only way to guarantee this - don't delay!!

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