A high court judge has given the green light for a probe into the City watchdog's decision to take no action over a regulatory compensation scheme which excluded thousands of individuals who might have otherwise claimed more than £1bn in compensation over mis-sold interest rate hedging products.

The exclusion was down to a decision from the Financial Services Authority, the precursor to the Financial Conduct Authority. The FSA was criticised in 2021 for limiting the scope of the redress scheme to leave out 5,000 customers. This was according to an independent review by Jonathan Swift QC, who released the findings in 2021 after examining the redress scheme.