A separate issue from manipulation is foreign exchange derivatives misselling. Banks in the UK and across Europe have already faced a wave of claims for the misselling of interest rate derivatives (Swaps). Banks potentially face even more claims for the mis-sale of foreign exchange (Forex) derivatives. This concerns banks and brokers who have been persuading companies to enter into extremely complicated Forex trades which are entirely unsuitable for ordinary businesses. Instead of helping them to mitigate against currency risk, these contracts are speculative products which have the potential of leaving companies with enormous liabilities. See here for further details.
Such claims may also be brought in the UK against non-EU banks and brokers where the clients’ contracts are:
- governed by English law; and/or
- require disputes to be settled in a UK court or arbitration tribunal.