As details come to light of the “most serious misconduct” by banks the FSA has ever seen, professional bodies ask whether increased legislation would have prevented the rate fixing scandal, which has led to the resignation of both Chairman and Chief Executive at Barclays.

New Chief Executive of the CIPD Peter Cheese thinks not. “The obvious reaction has been to talk of regulation and legislation, prosecutions, and even compensation for those adversely impacted. And while there are some gaps to be closed, the real issue that needs to be understood and addressed is that of culture and leadership.

No amount of regulation will stop people from behaving unethically if they either don’t see it as that, believe they can get away with it, and particularly where the rewards outweigh the perceived risks.  Culture is driven not just by what is said, but more importantly how senior people act, and what the organisation allows to become tolerated behaviour,” he said.

However, businesses affected by the mis-selling will undoubtedly seek compensation, with the potential cost of claims against banks being forecast at between £3bn and £6bn in the months to come.

Michael Brennan, a partner at Bracewell, which is currently representing around 30 businesses affected said: “We’re aware of many businesses that have been forced into severe financial distress, administration and liquidation, often at a huge emotional cost to the owners and managers, as they were unable to keep up with their payments.

“If an FSA-endorsed compensation scheme is established, it will enable the businesses to recoup some of the money they have been forced to pay out under these mis-sold interest rate swap agreements. It’ll be interesting to see how this scheme works and how similar its structure will be to the Financial Ombudsman Scheme or Financial Services Compensation Scheme.”