A claims management company specialising in interest-rate swap mis-selling could become an alternative business structure (ABS) in order to litigate its own cases.
All Square Treasury has just announced the appointment of Melanie Dickinson Denby, former head of non-standard debt litigation at Optima Legal, as legal director.
The hire brings more than 10 years of commercial and financial litigation experience to the firm and edges it closer to becoming a ‘one-stop shop’ for businesses seeking legal assistance over mis-sold business loans and interest rate hedging product claims.
Managing director Daniel Hall said ABS status is “very much on our radar”, but said there are not yet “concrete plans” to apply for a licence.
Mr Hall said: “We definitely see a trend occurring in this market where either firms like us will become ABSs, or specialist firms will team up with ABSs or solicitors.
“We are monitoring how the market develops and there is a bit of cost and work to do in order to become an ABS, but there is a strong case for it.”
The boom in financial services claims as a result of the Libor rigging and interest rate swap mis-selling banking scandals has provided a new niche area for companies such as All Square Treasury to move into.
It was only established in 2012 with the aim of helping small and medium-sized businesses.
However, until it is regulated by the SRA, it cannot litigate its own cases; instead it refers its cases on to law firms.
Mr Hall added: “It is unclear how long this opportunity is going to last for. The Financial Services Authority redress scheme for the smaller, ‘unsophisticated’ claimants is only just starting to happen and I’d be very surprised if everything is done in the next 12 months.
“Then there is the larger, ‘sophisticated’ claimants who cannot go down the redress route and need to litigate. Because of that, I would think that there is a two-to-three year window and we’ll be watching the market closely.
“There’s also potentially other opportunities we could go into and which, as a leading claims management firm in this specialist sector, we are monitoring. One example is the Guardian Care Homes versus Barclays case, which depending on the result, could lead to quite a lot of similar litigation.”
Commenting on her appointment, Ms Dickinson Denby said: “The dynamic and enterprising approach of All Square Treasury was a key factor for me in joining the business. I am looking forward to working with the team and our clients, at a time when the landscape of financial product mis-selling is extremely challenging for businesses.”