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RBS settles Opal Properties £669m swap claim

Opal properties

Royal Bank of Scotland settles legal case filed by the owner of a bankrupt student accommodation provider in Manchester, Opal Properties. This is the largest case of its type valued at £669 million.

Royal Bank of Scotland been accused of misleading a property tycoon into taking out an interest rate swap, which allegedly forced his firm into financial distress. Mr. Stuart Wall (owner of Opal Properties), has been advised by Vedanta Hedging for over three years, in an attempt to sue RBS for mis-selling a complex interest rate derivative.

Mr. Wall previously alleged RBS Global Restructuring Group mis-sold interest-rate swaps, which forced Opal Properties into administration in 2013.

It’s taken everything I’ve worked for, 30-odd years building up a company. They took it away and we didn’t understand why. There are so many people who have given up because of the cost of justice”

Stuart Wall, Evening Standard

Wall, also included allegations in documents lodged with the High Court that false Libor submissions were known about “at a high level” and included sterling Libor manipulations.

While the terms of the settlement are not able to be disclosed. The four- year claim has been valued at up to £669 million.

“The action has been settled without any admission of liability by the bank…The terms of the settlement are confidential.”

Wall’s lawyers at Hausfeld in London said in a statement

RBS issued the same statement.

RBS has previously been criticised for forcing companies into administration and into its GRG department.The bank has previously admitted to misconduct over its handling of small businesses.

This dispute highlights clearly that even large and apparently ‘sophisticated’ property investors do not necessarily understand some of the complexities and risks of derivatives.

Vedanta Hedging advises some of the UK’s largest property firms on interest rate and FX derivative hedging.

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