Economy

FCA pressed to publish full RBS report after 'whitewash' clams

The report examines RBS's controversial Global Restructuring Group (GRG), which operated between 2005 and 2013.

At that time the FCA said that while the number of businesses unable to access the FOs was small, those unable to do so account for a substantial share of the sector's demand for financial services, and some of them are likely to be less experienced dealing with financial products and services despite their greater size.

The summary reveals that although the most serious allegations made against the bank were not upheld, the FCA believes there were areas in which the inappropriate treatment of customers was "widespread".

RGL Management chief executive James Hayward said: "We have always said that the FCA report will be a whitewash and that now looks to be the case".

"If the FCA can not, or will not, take action against the bank then it is important for distressed businesses and individuals to seek justice in the courts".

FSB National Chairman Mike Cherry is furious that 8,000 small business "ruined" by RBS's Global Restructuring Group could be excluded from the company's £400m compensation package.

These include the failure to support SME businesses "in a manner consistent with good turnaround practice" and focusing too much on pricing increases and debt reduction "without due consideration to the longer-term viability of customers". We urge the FCA to make its full findings on GRG known so victims can finally receive the support they're due. "That starts with equipping them with the information they need to achieve compensation".

Ross McEwan, chief executive of RBS, responded to the publication of the summary by saying that he was "pleased" the most serious allegations made against the bank had not been upheld. GRG has widely been accused of pushing some firms - which it was meant to be supporting - into bankruptcy for its own profit. RBS has since taken voluntary steps, such as its proactive review of complex fees, and setting up a complaints scheme for eligible SME customers, overseen by an independent monitor, Sir William Blackburne.

The FCA says it will now "carry out a more focussed investigation" and identify whether there is any basis for further action within its powers, although commercial lending activity remains largely unregulated in the UK.

"The regulator has again confirmed that the remediation steps we announced in November to address concerns for customers are appropriate".

Today's (23 October) publication is a summary of that review which was completed a year ago, and which found that while RBS did not set out to artificially engineer the transfer of companies to its business support division, there were "isolated examples" of poor practice.



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