Friday 9th May 2014
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The Commerce Commission says farmers concerned about the way their interest rate swaps were sold to them have until the end of the month to contact the regulator otherwise they may miss out on future compensation claims.
The antitrust regulator is investigating the alleged mis-selling of interest rate swaps in the rural sector by the New Zealand branches of the Australian-owned ASB, ANZ and Westpac banks between 2005 and 2009, citing possible breaches of the Fair Trading Act, and said it was also looking at other institutions which sold the swaps.
"We want to ensure that we have received information from all potentially affected customers before we take next steps in this investigation," said commission chair Mark Berry. "We cannot be confident that any compensation sought in court or that may otherwise be available will be obtainable for customers who have not made contact with us."
In April the Financial Markets Authority, the securities markets watchdog, joined the probe, expanding the investigation to see if laws including the Securities Act 1978 and the Securities Markets Act 1988 had been breached.
Interest rate swaps are intended to allow clients to manage the interest rate exposure on their borrowing and are typically marketed to large corporations and institutions. From 2005, banks began marketing them to their rural and commercial clients and the Commerce Commission has received more than 140 complaints about the way the financial derivatives were sold.
Rural customers concerned about their interest rate swaps need to contact the commission before May 30 to be included in the investigation.
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