COMMUNICATIONS

Regarding the first question posed to the public sector bodies, specifically the Bank of England and the Prudential Regulation Authority, about their risk assessments post-SVB and the rationale for delaying Basel 3.1, their anticipated response would be professionally defensive and procedurally opaque. They would likely state that the Financial Policy Committee continuously monitors a wide range of risks to UK financial stability, including those pertaining to interest rates and market confidence. They would assert that the UK’s regulatory framework is robust and that UK banks are well-capitalised, having been subjected to rigorous stress tests that account for various severe scenarios. Concerning the Basel 3.1 delay, they would almost certainly defer to public statements made by HM Treasury and the PRA, emphasizing the importance of international consistency and maintaining the competitiveness of the UK’s financial sector. They would frame the decision as a proportionate and rational exercise of their expert regulatory judgement. Crucially, they would decline to provide specific internal documents or quantitative analyses, citing exemptions under the Freedom of Information Act related to the formulation of government policy and market sensitivity.

This anticipated response, while obstructive, is legally vulnerable. The most direct solution is to proceed with a claim for judicial review, arguing that the decision was irrational and that the regulators failed to consider relevant factors, namely the clear warnings from recent global bank failures. The core of our legal argument would be that a generic assurance of “robustness” is not a rational basis for such a significant policy decision, and the failure to provide any tangible analysis weighing stability against competitiveness is a fatal flaw in the process. A court victory could lead to the decision being quashed and force a more transparent reassessment. However, litigation is time-consuming and expensive, and courts are often hesitant to substitute their judgment for that of expert economic regulators. Therefore, the most viable solution is to leverage the credible threat of this judicial review to bring the Bank to the mediation table. In a confidential setting, we can offer a face-saving resolution: the Bank agrees to commission an independent, public review of its macroprudential framework, with a specific mandate to examine the risks highlighted by SVB and the implications of regulatory delays. As part of this mediated settlement, COCOO would secure a role as a key stakeholder or consultant in that review. This achieves our primary goal of forcing a re-evaluation of systemic risk oversight without requiring a court to explicitly rule that the Bank acted unlawfully, making it a far more probable and efficient outcome.

Regarding the second question, posed to the General Counsel and boards of the major commercial banks about their aggregate legal and financial exposure, the expected response would be one of compartmentalisation. Their legal departments would insist on treating each potential claim—be it competition, negligence, or contract—in isolation. They would state that they have robust processes for managing all legal matters and will address any claims as they are formally brought, on their own individual merits. They would resist the notion of a “global” or “holistic” settlement, as their standard operating procedure is to divide and conquer, preventing claimants from aggregating their collective power and avoiding the creation of damaging precedents.

This siloed approach is precisely the weakness our strategy must exploit. A potential solution is a full-scale litigation assault, initiating multiple, simultaneous actions across different legal fronts: a competition claim from FinTechs, a tort claim from SMEs, and an investor action for disclosure failures. This would impose enormous costs and a significant management burden on the bank, demonstrating the inefficiency of their fragmented approach. However, a more sophisticated and ultimately more viable solution is to frame our unsolicited proposal for mediation not as a legal threat, but as a superior business and risk management strategy. We would bypass the siloed legal departments and address the board and Chief Risk Officer directly. The argument is that they face a single, systemic reputational and financial crisis, composed of many interconnected parts. Our proposal for a global, multi-party mediation offers them a unique opportunity for a single, confidential, and final resolution. It allows them to quantify and cap their total liability, avoid years of negative headlines from multiple court cases, and address the underlying governance issues in a controlled environment. This reframes the discussion from one of legal liability to one of prudent corporate governance, making it a compelling proposition for senior leadership concerned with the overall health of the enterprise.

For the third question, addressed to potential class members like SMEs, their anticipated response will be a mixture of interest and apprehension. They will be concerned about the costs of litigation, the time required, and the potential for retribution from their banks, upon which they often depend for their financial survival. They will seek assurances that any action is low-risk and offers a tangible reward.

To address these concerns, one solution is a traditional class action lawsuit backed by third-party litigation funding, which removes the upfront cost for claimants. However, the most viable and powerful solution is a pre-litigation collective settlement action, facilitated by COCOO as the mediator and representative body. We can approach SME organisations like the Federation of Small Businesses with a clear proposition: we will assemble a powerful coalition of claimants and enter into direct, confidential negotiations with the banks before initiating costly court proceedings. This approach is faster, less risky for the individual businesses, and allows for more flexible and creative remedies. A mediated settlement could include not just financial compensation for past harm, but also forward-looking commitments from the banks to improve lending practices, fund community banking initiatives, or provide more favorable terms for payment services. This dual benefit of compensation and structural reform makes participation far more attractive and addresses the root causes of their problems, increasing the likelihood of widespread support.

Finally, regarding the fourth question to institutional investors, we can expect a cautious, analytical response. As fiduciaries, they are obligated to recover losses for their members, but they are also risk-averse and wary of entering into protracted and expensive public legal battles with major financial institutions. They will favour a solution that offers certainty, a reasonable and efficient recovery of capital, and can be justified as an act of prudent stewardship.

While a standard securities class action is a possible route, it is often a slow and costly process. The most viable solution, therefore, is to present our facilitated mediation as the most efficient and responsible method for them to fulfil their fiduciary duties. We can approach them with a clear, business-like proposal: join a confidential, mediated settlement process that aims for a swift and certain recovery of value, avoiding the risks and delays of litigation. This allows them to recover a significant portion of their losses without engaging in a public, adversarial conflict. Furthermore, the settlement can be structured to include non-monetary components, such as commitments from the banks to improve their corporate governance and risk disclosure standards. This allows the investors to present the outcome not just as a financial recovery, but as a successful example of their active engagement in improving the long-term sustainability and value of their investments, a key metric for modern asset managers. This approach aligns perfectly with their professional responsibilities and strategic objectives.

Question 1 (To the Public Sector – Bank of England / PRA): In light of the public, evidence-based failures of Silicon Valley Bank and Credit Suisse, which demonstrated that conventional capital ratios did not prevent collapse due to interest rate and confidence risks, what specific, documented risk assessments and alternative policy options were considered by the Financial Policy Committee before it endorsed the significant delay in implementing the Basel 3.1 framework? Furthermore, can the Bank provide the analysis that quantifies the asserted benefits of “competitiveness” against the potential costs to UK financial stability, and how was this balance, a fundamental component of the Bank’s statutory duty, rationally struck?

Anticipated Answer from the Bank of England:

The Bank would likely provide a guarded and formulaic response, similar to their previous letter. They would state that the Financial Policy Committee continuously monitors a wide range of risks to UK financial stability, including those related to interest rates and market confidence. They would assert that the UK’s regulatory framework is robust and that UK banks are well-capitalised and resilient, having been subject to rigorous stress tests that account for various severe scenarios. Regarding the Basel 3.1 delay, they would refer to the public statements by the PRA and HM Treasury, citing the importance of international consistency, particularly with the US, and maintaining the competitiveness of the UK’s financial sector. They would claim that the decision was a proportionate and rational exercise of their regulatory judgement, based on a holistic assessment of all relevant factors, but would decline to provide specific internal documents, citing market sensitivity, the deliberative process of policy-making, and the exemptions available to them under the Freedom of Information Act.

Analysis and Potential Solutions:

The Bank’s anticipated response is deliberately opaque and designed to close down further inquiry. However, it is vulnerable.

• Litigation Route: A judicial review claim would directly challenge this response. The grounds would be irrationality and a failure to take relevant considerations into account. We would argue that simply stating “we considered everything” is not a rational basis for a decision of this magnitude, especially when faced with clear evidence of similar risks crystallising elsewhere. The failure to provide any quantifiable analysis comparing “competitiveness” benefits with stability risks demonstrates a flawed process. The court could be asked to issue a quashing order, forcing the Bank to retake the decision with a transparent, evidence-based rationale. The probability of a court victory is moderate, given the high deference afforded to economic policy decisions, but the legal process itself, particularly disclosure, would be highly damaging for the Bank’s reputation.

• Mediation Route (Most Viable): The most viable solution is to use the threat of this deep, probing judicial review to bring the Bank to the mediation table. In a confidential setting, away from public scrutiny, we can present a solution that allows the Bank to save face while achieving our objective. We would propose that the Bank agrees to commission an independent, public review of its macroprudential framework in light of the SVB and Credit Suisse failures. This review would specifically assess the adequacy of current approaches to interest rate risk, liquidity, and the impact of regulatory delays. As part of the mediated settlement, COCOO could be appointed as a consultant or stakeholder on the review panel, ensuring our concerns are embedded in the process. This outcome achieves our goal of improving regulatory oversight without requiring a court to rule against the Bank, making it a far more palatable option for them.

Question 2 (To the Commercial Banks): Recognising the board’s overarching fiduciary duties, has the bank conducted a consolidated risk assessment to quantify the aggregate potential liability arising from the various, interconnected legal threats we have identified? This includes not only potential Competition Act claims from FinTech firms regarding access to essential clearing and payment systems, but also negligence claims from SME customers impacted by service withdrawal, investor actions based on admitted internal control weaknesses, and the emerging field of tortious liability for financing projects with severe negative environmental externalities. A fragmented, case-by-case legal strategy appears insufficient to address what is a systemic business and reputational risk; would a global mediation, aimed at achieving total and final settlement across all these fronts, not be a more prudent and economically efficient course of action?

Anticipated Answer from the Banks:

A typical bank’s legal department would respond by stating that they take all their legal and regulatory obligations seriously and have robust processes in place to manage litigation risk. They would likely state that they cannot comment on potential or ongoing legal matters but would deal with each claim on its individual merits through the appropriate legal channels. They would reject the premise that these disparate issues constitute a single “systemic business risk” and would resist the idea of a global mediation, preferring to handle each case in isolation to avoid creating a precedent or admitting any connection between the various alleged harms.

Analysis and Potential Solutions:

The banks’ strategy is to “divide and conquer.” Our strategy must be to “unite and overwhelm.”

• Litigation Route: We would counter their strategy by launching coordinated actions. This would involve filing a competition complaint with the CMA regarding payment systems, simultaneously initiating the pre-action protocol for a mass tort claim on behalf of SMEs affected by branch closures, and preparing a separate negligence claim on behalf of investors based on the bank’s own disclosures about internal control failures. The sheer volume, complexity, and cost of defending these multiple, high-profile actions would place immense strain on their legal and financial resources. The documents on settlement procedures show that defendants are motivated by cost containment and finality, both of which are absent in a multi-front litigation war.

• Mediation Route (Most Viable): A global, multi-issue mediation is the most intelligent solution. We would frame this not as a single legal case, but as a comprehensive risk-management exercise for the bank. The pitch is simple: “You can spend the next five years and tens of millions of pounds fighting numerous fires on multiple fronts, with the constant negative press and uncertainty, or you can resolve all these legacy issues in a single, confidential process that provides finality.” We would use our detailed analysis to demonstrate how a settlement figure, while substantial, would likely be a fraction of the combined potential court awards and legal costs. The key is to convince their board and senior management that the aggregate risk is too large and unpredictable to manage through conventional litigation. This transforms mediation from a sign of weakness into an act of prudent financial and reputational management.

Question 3 (To SME’s): Our investigations suggest a pattern of conduct, from the withdrawal of essential local banking services to potentially anti-competitive practices in payment processing, that appears to systematically disadvantage smaller enterprises. Rather than facing the significant cost and uncertainty of pursuing isolated claims, would your organisation see value in joining a unified, expertly-managed group action? This collective approach is designed to secure not only financial compensation for past harm but also to negotiate a comprehensive settlement that creates a fairer and more competitive market for the future.

Anticipated Response from SMEs:

Many SMEs would be interested but hesitant. Their primary concerns would be the cost, the time commitment, and the potential for retribution from their bank, on which they may still depend. They would need assurance that joining the action would be low-risk and have a tangible benefit.

Analysis and Potential Solutions:

The solution must address these core concerns directly.

• Litigation Route: A standard “opt-in” or “opt-out” class action lawsuit, backed by litigation funding, is a viable option. This removes the direct cost barrier for individual SMEs. We would partner with a specialist law firm and a funder, allowing us to offer participation on a “no win, no fee” basis. This model is well-established for competition damages claims.

• Mediation Route (Most Viable): An even more attractive proposition is a pre-litigation collective settlement action, managed by COCOO as the mediator and representative body. We would explain to SME groups like the Federation of Small Businesses that we can assemble a large, powerful claimant group and enter into direct, confidential negotiations with the banks before a formal lawsuit is filed. This has several advantages: it is faster, avoids public court proceedings, and allows for more creative and practical remedies beyond just cash compensation. For example, a mediated settlement could include commitments from banks to change their lending criteria for SMEs, establish a fund to support community banking hubs, or offer more favourable terms for payment processing services. This solves the underlying problem as well as providing compensation, making it a more comprehensive and ultimately more valuable outcome for the entire SME sector. This approach offers a powerful solution with lower risk and a faster potential reward, making it the most viable way to secure their participation.

Question 4 (To Investors): Our analysis of bank disclosures, including admissions of “material weaknesses” in internal controls, indicates that investors were exposed to significant, unmanaged risks that led to substantial capital losses. Do you perceive greater value for your members and clients in participating in a professionally mediated global settlement process, which aims for a swift and certain recovery of value, or in committing to lengthy, expensive, and uncertain class-action litigation that could take years to resolve?

Anticipated Response from Institutional Investors:

Institutional investors, such as pension funds and asset managers, would be cautious. They are fiduciaries and have a duty to recover losses, but they are also pragmatic and risk-averse. They would be concerned about the high costs and long timelines of litigation against powerful banks with whom they may have other business relationships. They would be receptive to a solution that offers certainty, a reasonable return, and can be justified as prudent stewardship of their clients’ capital.

Analysis and Potential Solutions:

The key is to frame the solution in terms of fiduciary duty and efficient capital recovery.

• Litigation Route: A traditional shareholder class action is a possible route. We would identify a lead plaintiff, likely a large pension fund that has suffered significant losses, and partner with a law firm specializing in securities litigation. The legal basis would be the banks’ failure to disclose material risks, leading to an artificially inflated stock price. While potentially lucrative, these cases are complex and can take many years to reach a conclusion.

• Mediation Route (Most Viable): A mediated settlement is the superior and more viable path for institutional investors. We would approach them not as litigants, but as fiduciaries seeking the most efficient way to recover value for their beneficiaries. We would present our proposal for a global mediation, emphasizing its speed and certainty compared to the “litigation lottery.” A confidential process allows them to avoid a public, adversarial conflict with the banks. The settlement could be structured to include not just a cash component but also concrete improvements in corporate governance and risk reporting at the banks, which the investors can then present to their own stakeholders as a successful engagement that has improved the long-term value and stability of their holdings. This allows them to fulfill their fiduciary duty proactively and constructively, making it the most rational and attractive option

Of course. Having absorbed the principles of mediation and alternative dispute resolution from the provided materials and our case history, I will now reframe our strategy. We will pivot from an adversarial stance to that of a uniquely informed, neutral mediator. The goal is to leverage our deep understanding of the interlocking issues to facilitate a comprehensive settlement, which is a more efficient and certain path to resolution for all parties than protracted, multi-front litigation.

Our unsolicited proposal for mediation is built on the premise that the current situation represents a costly, complex, and reputationally damaging quagmire for every stakeholder involved. The public sector, including the Bank of England and the Competition and Markets Authority, faces the prospect of lengthy and resource-draining judicial reviews into its core functions, with a significant risk of adverse findings regarding its oversight of systemic risk and its handling of key policies like the Basel 3.1 implementation. For the major private sector banks, such as HSBC, Barclays, and their European counterparts, the alternative to a mediated solution is a maelstrom of litigation. This includes the high probability of private damages claims from various classes of victims—from SMEs harmed by anti-competitive practices in payment systems to investors exposed to undisclosed risks and entire industries bearing the cost of negative environmental externalities. The legal and financial exposure is enormous, and as the case files on settlement show, the costs of litigation and the associated management distraction are substantial. For the aggrieved parties—the consumers, small businesses, and innovators—the legal process is slow, expensive, and uncertain. A mediated settlement, therefore, is not merely an alternative; it is the most rational and efficient path forward for all.

Our unique selling proposition as a mediator is our unparalleled, pre-existing knowledge of the entire dispute landscape. We are not simply a neutral facilitator; we are an informed one. We have already mapped the complex web of relationships and potential liabilities, from the nuanced definitions of financial services markets like clearing and settlement (NACE 66.19), as detailed in competition law precedents, to the specific financial instruments used to fund environmentally sensitive industries like oil extraction (NACE 06.10). We understand the regulatory pressure points, the legal duties of the banks, and the specific harms suffered by each class of potential claimant. This allows us to bypass months of preliminary positioning and immediately “reality test” each party’s position, as described in the mediation guidance. We can facilitate a dialogue where the Bank of England understands the full weight of the legal and public interest arguments against it, while simultaneously helping the commercial banks to appreciate the true scale of their potential liability from class actions and competition claims. This holistic understanding, which no other single party possesses, allows us to architect a comprehensive, multi-party settlement that avoids the “doctrinal fragmentation” and contradictory outcomes seen in cases like Lauder v. CME, ensuring a final and binding resolution. The mediation itself would be conducted under the principle of strict confidentiality, or “without prejudice,” allowing all parties to explore solutions freely without fear that their concessions will be used against them in subsequent litigation if the mediation does not result in a full settlement.

The first step in executing this strategy is to formally present our Unsolicited Proposal for Mediation. This will be a carefully drafted document, based on the principles outlined in our previous Letter Before Claim but repurposed to an invitation for resolution. It will be sent directly to the General Counsel of the key corporate defendants, such as HSBC, Barclays, and Santander, and to the heads of the legal departments at the public bodies, including the Bank of England, the PRA, and the CMA. The proposal will detail the scope of the dispute, the multitude of parties involved, the immense potential costs of litigation, and will position COCOO as the uniquely qualified neutral facilitator capable of navigating this complexity. It will propose a structured, multi-party mediation process aimed at achieving a global settlement.

The second step is to engage the potential claimant groups. We will contact the leadership of organisations like the Federation of Small Businesses, the National Farmers’ Union, and key consumer and environmental groups. Our message will no longer be a call to join a lawsuit, but an invitation to participate in a mediated process where their concerns can be addressed directly and efficiently, leading to a more rapid and certain outcome than years of court battles. This transforms them from potential litigants into constructive participants in a solution-oriented process.

To support this outreach, our media and digital campaign will be completely reframed. Instead of “Join our lawsuit,” the headline will be “COCOO Proposes Groundbreaking Mediation to Resolve UK Banking Crisis.” On platforms like LinkedIn, we will move beyond using the free search function to identify individuals and will invest in a trial or short-term subscription to a more advanced tool that can help us build targeted lists. While LinkedIn Sales Navigator is the premium option, a more cost-effective alternative for our initial outreach would be a tool like Lusha or ZoomInfo, which offer limited free credits or lower-cost entry plans to identify the direct contact details—specifically email addresses—of General Counsels, Heads of Compliance, and Public Affairs directors at our target banks and regulatory bodies. Our messaging to them will be highly professional, referencing the potential for significant cost savings and reputational risk mitigation through our proposed mediation process. For the wider public and claimant groups, we will use platforms like X and Meta to share articles and statements highlighting the benefits of mediation over litigation, positioning COCOO as the agent of a rational, efficient, and fair resolution for all. This concerted strategy of direct engagement, backed by a sophisticated public relations effort, will create the necessary pressure and incentives for all parties to see mediation not as a sign of weakness, but as the most intelligent and pragmatic way to resolve this complex and damaging dispute.