HSBC Pay $550m for Mis-Selling Mortgages
HSBC Holdings are set to pay $550m (£335m) in order to resolve a US regulators claim made against them. It is stated that the British bank has made a number of false representations in the sale of mortgage bonds to the federal mortgage companies Fannie Mae and Freddie Mac before the financial crisis hit back in 2007/08.
This will come as a blow to HSBC as it only adds to the amount that they’ve already paid out for things like the Payment Protection Insurance (PPI) which they mis-sold on such a wide scale.
The settlement was announced last Friday, September 12th between the bank’s US unit and the Federal Housing Finance Agency (FHFA), the regulator of the two Government-controlled finance companies.
This agreement coincidentally came just three weeks before a trial that was set to start on September 29th in New York. In this trial, HSBC could have faced charges up to $1.6bn in damages.
This deal is the latest in a long line of 18 different lawsuits that the FHFA filed in 2011 in order to recover losses on $200bn in mortgage-backed securities which were sold to Fannie Mae and Freddie Mac, which the US Govt. took control of amid the 2008 economic crisis.
After this revelation, the general public must find themselves asking, yet again “can the banks be trusted?”
If HSBC have been up to this over in the US, can anyone say that they haven’t been doing the same over here? Only a few weeks ago, RBS were fined £15 million for their mortgage advice failings so what’s to say that others haven’t been doing the same thing?
Of course, there’s not telling either way but trust in the big banks must be at an all-time low at the minute, especially after the PPI mis-selling scandal came to light in the mid-2000s.
Packaged Bank Accounts
Taking a side step away from PPI, there’s also come to light recently yet more reasons for trust in the banks to be at a severe low.
It is estimated that there are currently 1 in 5 of us here in the UK who have a packaged bank account and it’s come to light recently that these have been widely mis-sold too. Last year the Financial Ombudsman Service (FOS) received a total of 6,000 complaints about packaged bank accounts.
If you think that you’ve been mis-sold a PBA, you can make a packaged bank account claim with us today.