Laura Sharman 16 July 2018

Councils sue Barclays over controversial LOBO loans

Councils sue Barclays over controversial LOBO loans image

Barclays are being sued by 14 local authorities over allegations it committed fraud over loans to councils.

The group of councils claim the bank rigged interest rates so potentially manipulated charges to borrowers. The High Court claim - seen by The Mail on Sunday - is seeking for the loans to be rescinded, the fees to be refunded to the councils and for compensation to be awarded for damages.

Joel Benjamin, a campaigner for Debt Resistance UK, said: 'Having campaigned for councils to file fraud cases against the banks since 2014, we are thrilled councils have finally stepped in to protect local taxpayers by filing fraud claims against banks which brought our economy to the brink. 10 years after the crash, its town councils now facing bankruptcy to pay for the bankers bailouts.

'We know 240 councils have rip-off LOBO loans. We're now calling on the other 224 councils with LOBO loans to file legal action against Barclays, RBS, Dexia, ICAP, Tullet Prebon and CAPITA.'

The councils include Bristol, Bradford, Greater Manchester, Kirklees, Leeds, Liverpool, Newcastle, North East Lincolnshire, Nottingham, Oldham, Sheffield, South Gloucestershire, Walsall and West Yorkshire.

In 2015, the Channel 4 Dispatches programme found that around 240 local authorities have taken up to £15bn in LOBO loans from private banks, which charge interest rates of more than 7% in some cases.

Barclays declined to comment.

Participatory budgeting image

Participatory budgeting

Evgeny Barkov explains what participatory budgeting means and how it can reveal what citizens need.
SIGN UP
For your free daily news bulletin
Highways jobs

Head of Looked After Children and Vulnerable Young People

Enfield London Borough Council
Up to £89,319
 This is an exciting opportunity to lead all the services that support Enfield’s children in care and care leavers. Enfield (City/Town), London (Greater)
Recuriter: Enfield London Borough Council

Head of Communities

Kirklees Metropolitan Council
to £61,751 (pay award pending)
We are looking for an innovative and knowledgeable senior professional to join our leadership team with strong experience of working in communities... Kirklees, West Yorkshire
Recuriter: Kirklees Metropolitan Council

Economic Development Officer (Town Centres)

North West Leicestershire District Council
Band F, £29,636 - £32,878 per annum
The Economic Development Officer (Town Centres) post forms part of the Council’s Business Focus team who provide help directly to businesses. Coalville, Leicestershire
Recuriter: North West Leicestershire District Council

Educational Psychologist

Camden London Borough Council
£44,131 - £53,34
The ideal candidates will have an excellent understanding of psychological frameworks and their application in... Camden, London (Greater)
Recuriter: Camden London Borough Council

Economic Development Officer

North West Leicestershire District Council
Band F, £29,636 - £32,878
Are you interested in a challenge and want to help shape the future of North West Leicestershire? Coalville, Leicestershire
Recuriter: North West Leicestershire District Council

Public Property

Latest issue - Public Property News

This issue of Public Property examines how how flexible workspaces can lead the way in regeneration for local authorities, Why local authority intervention is key to successful urban regeneration schemes and if the Government’s challenge of embracing beauty is an opportunity for communities.

The March issue also takes a closer look at Blackburn with Darwen Council's first digital health hub to help people gain control over health and care services.

Register for your free digital issue