Champneys sue Lloyds for £16mn over mis-sold financial product
Champneys are suing Lloyds Bank for £16mn for mis-selling an interest rate swap based on Libor that they claim the bank told them they had to take out to cover half of the bank's £33mn loan to the company. Lloyds has said it will contest the claim.  
Spa chain Champneys, whose guests have included Tony Blair and Victoria Beckham, is suing Lloyds Bank for £16 million over a financial product it says it was mis-sold.

The legal battle centres on an interest rate swap, a complex deal to protect borrowers against interest rates rises. But many swaps ended up costing customers dear as rates fell.

Champneys owner Stephen Purdew, who last year featured in a warts-and-all documentary at his flagship spa in Tring, Hertfordshire, is accusing Lloyds of breach of contract and acting in its own interests.

No pain, no gain: Champneys has four spas including its flagship resort, Champneys Tring

Purdew and his mother Dorothy, who co-own the four-strong chain, say Lloyds told them they had to take out an interest rate swap based on Libor, the rate at which banks lend to each other, to cover half of the bank’s £33 million loan to the company.

However Lloyds was last year found guilty of trying to manipulate Libor between 2006 and 2009 and fined £218 million for ‘serious misconduct’. The writ says that if this had not been hidden from Champneys it could have continued its swap arrangement with RBS.