Unclaimed payouts ‘may hit Exchequer’
FINANCE: The taxman could miss out on a windfall of as much as £2bn due to 200,000 investors failing to make claims from a long-running Swiss banking scandal, say lawyers.
Courts ruled seven years ago that banks unlawfully charged hidden fees on savers and set a deadline for repayments by the end of this year.
THE TAXMAN could miss out on a windfall of as much as £2bn due to 200,000 investors failing to make claims from a long-running Swiss banking scandal, lawyers have warned.
Swiss courts ruled seven years ago that banks in the European country had been unlawfully charging hidden fees on savers and ordered them to return the cash, in echoes of the UK’s PPI scandal.
But a deadline has been set for the end of this year, and up to £4.68bn remains unclaimed by investors in the UK, according to specialists at the litigation funding firm, Liti-Link.
Hubert Schwarzler, the chief executive of Liti-Link, said: “New Year’s Eve could be a sorry start to 2020 for savers who have been swindled by greedy Swiss banks.
“We urge anyone who has invested in Swiss banks over the last decade to contact Liti-Link as soon as possible. It might be the difference between getting a surprise Christmas bonus, or starting the New Year out of pocket.”
He added that savers in Swiss banks from Italy and Germany have already inundated his company, but investors from the UK have been slower to act.
The average amount owed to British investors is thought to be around £23,400, and if all £4.68bn was returned, HM Revenue and Customs (HMRC) would be in line for a tax windfall of £1.87bn.
For years, Swiss banks, including UBS and Credit Suisse, claimed underhand commission fees of up to two per cent on money invested by their clients, without their informed consent.
That was until Swiss courts said unless fees were charged with explicit authorisation, bankers cannot retain them and must hand back the cash to savers who request it, with a five per cent interest charge for late payment.
But judges also imposed a time limit for claims, and clients can only recover their money up to 10 years since the fees were charged.
The right of clients who were charged fees in 2009 to claim back their money will expire in 2019 – so New Year’s Eve could be a sorry start to 2020 for savers left out of pocket.
The underhand commission fees, or “retrocessions”, were a well-established and lucrative component of Swiss investment practice for many years.
Meanwhile, research published today has shown that fewer than one in four construction workers regularly pay into a workplace pension amid warnings they are being “failed” by the Government.
Unite said a Freedom of Information (FOI) request to the Department for Work and Pensions showed that just 23 per cent of blue collar construction workers are in a workplace pension.
The union said the figures showed a “major failure” of the Government’s auto-enrolment pension scheme, which was designed to ensure all employees pay into a workplace pension.
Unite’s Assistant General Secretary Gail Cartmail added: “Until rampant casualisation and bogus self-employment are tackled in the construction industry, workers are not going to be eligible or prepared to register for a workplace pension.”
The Department for Work and Pensions claimed a record 671,000 eligible construction workers are now saving into workplace pensions, up from 232,000 five years ago.
A spokeswoman added: “Almost four in five eligible private sector construction industry workers were saving in workplace pensions in 2018.
“Since 2012, more than 10 million people have been automatically enrolled into workplace pensions.”
It could be a sorry 2020 for savers swindled by greedy Swiss banks.
Hubert Schwarzler, chief executive of Liti-Link.