May 20

Beware of committing to deals on the phone

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At our May 2015 meeting, Gary Kendall, one of our members took us through some of the recent mis-selling scandals involving the major banks, in particular some that affected small and medium businesses (SMEs).

The mis-selling that is shown in the video below involves selling a swap alongside a loan.  This fixes an interest rate (in the bank’s favour) and the swap also cannot be paid off early without paying the full 10 years interest.

 

One frightening aspect is that the customer is committed just by agreeing on the phone call, even before he has signed the paperwork, and certainly without the cooling off period that applies to consumers.

Beware of what you say yes to on the phone and take financial advice, or make really sure you understand the consequences before agreeing to financial deals.