Posted: 22 June, 2012 at 12:32 pm

MP backs care home under threat from bank ‘mis-selling’

MP backs care home under threat from bank ‘mis-selling’

MP John Healey has stepped in to back a company which claims mis-selling by Barclays is threatening their business, including two Dearne care homes.

Guardian Care Homes (GCH), which runs Dearne Valley Care Centre in Bolton-on-Dearne and The Grove Care Centre, Thurnscoe, says the bank wrongly sold it interest rate ‘swaps’ which, because interest rates fell to 0.5%, have cost the company £12m so far.

Mr Healey has met with the GCH Chief Executive and Senior Operating Director, and has written to Barclays Chief Executive Bob Diamond seeking reassurances that Barclays will not recall the money lent – £70m – before GCH has had chance to present its case in the High Court.

He said: “Guardian Care Homes employs 73 staff in the Dearne and has 55 residents – mostly elderly and vulnerable.

“It is extremely concerning that jobs and people’s homes may have been put under threat by mis-selling.”

Mr Healey spoke during a Parliamentary debate today, when Labour MPs called for action to ensure protection for businesses – mostly small firms – caught up in the interest rate swap mis-selling scandal.

Mr Healey told Parliament that small companies were often afraid to complain in case the banks pulled their loans, putting them out of business.

He said: “A moratorium is needed following complaints, and firms should be able to make collective challenges for redress.”

GCH houses around 900 elderly and vulnerable residents in their 27 care homes across the UK and employs over 1000 staff.

Gary Hartland, GCH chief executive, said: “We are hugely grateful to John and his parliamentary colleagues for their support over recent weeks.

“Today is a wake-up call for the major lending banks who for years made millions of pounds by selling these toxic products at the expense of small businesses.

“There is now cross party support for swift and decisive action to be taken by the FSA which will ensure that the banks compensate these businesses, while guaranteeing the practice can never happen again.

“To date SMEs have been unable or too afraid to complain but I hope now they will shout out and secure the redress they need and deserve.”