Posted on Sep 26, 2020 at 1:07 PM
BNP Paribas’ main credit subsidiary will have to immediately pay compensation “in the order of 127 million euros” to borrowers in the Helvet Immo loan case, after its conviction at first instance in February. It was BNP Personal Finance’s lawyer, Me Philippe Métais, who confirmed the amount and the decision of the Paris Court of Appeal on Friday.
The latter dismissed the company’s claim, which called for an end to the provisional enforcement of the large damages awarded by the court on February 26. The lawyer indicated that he was studying the possibility of an appeal against this decision.
“Deceptive Marketing Practice”
BNP Paribas Personal Finance, known in France under the Cetelem brand, was ordered to pay 187,500 euros (the maximum fine) and to pay damages, for having concealed the risks induced by its loans in Swiss francs, to the detriment of more than 4,600 borrowers.
The wholly-owned subsidiary of the leading French bank was found to be “guilty of deceptive commercial practice” and “concealment” of this offense for the marketing, in 2008 and 2009, of these loans. The company is disputing this charge and has appealed, but a hearing date has yet to be set.
The lawyer of about 1,300 civil parties out of the 2,300 constituted at the trial, Charles Constantin-Vallet, declared Friday evening that his clients “welcome this decision, which is very severe with regard to BNP”. “It is a halt to BNP PPF’s strategy of judicial exhaustion of victims,” he added.
Loans denominated in Swiss francs and repayable in euros
Savers accuse the bank of having concealed from them “an incredible financial risk” inherent in the loan. The special feature of the loan is that it is denominated in Swiss francs but repayable in euros. Result: when after the financial crisis the euro stalled against the Swiss currency, some 4,600 borrowers saw the amounts to be repaid soar. Many still owe more principal than the amount borrowed even though they have been paying for more than ten years.
Source: hooly News