Small businesses demand truth from RBS investigation
As the Royal Bank of Scotland (RBS) admits its turnaround division failed small business customers, the Federation of Small Businesses (FSB) has called for full publication of the investigation.
The bank’s Global Restructuring Group (GRG), which closed in 2013, has been under investigation by the Financial Conduct Authority (FCA) after allegations emerged that small businesses were deliberately led into disrepair.
With the report yet to be published in full, both its author and RBS have confirmed the bank’s failings.
Addressing the Treasury select committee, Tony Boorman, head of Promontory, the financial group which undertook the RBS investigation, told MPs that the division placed its customers on a pathway to insolvency, and reiterated his call for the report to be published.
Later, the bank’s chief executive, Ross McEwan, admitted RBS did not do a good job with these customers and the report shows that.
__________________________________________________________________________________ What was inside the leaked report?A leaked copy of the full report revealed RBS staff were pressured to mislead small business owners inside the GRG, and were offered financial incentives to deliver misinformation.
Responding to the committee hearing, Mike Cherry, FSB chairman, said customers now deserved to see the full findings of the RBS investigation.
three-and-a-half years on from the commissioning of Promontory’s GRG report and were still yet to see its findings in full, despite the author’s recommendation that they should be published, he said.
it’s time that those small business owners who had their lives destroyed by GRG finally had the truth about who knew what. After ten years, it’s the least they deserve.
A leaked copy of the report confirmed staff were told to let customers hang themselves, with 92 per cent of customers encountering inappropriate action. Memos were also leaked, revealing staff were encouraged to put greater pressure on customers to accept higher interest rates.
rBS later came after our property, and we had to find 40, 000 to stop them getting it.”
One small business owner brought into the GRG, who wished to remain anonymous, got in touch with Business Advice to highlight the reality of the division’s practices.
at the time of all this I ran a small engineering company and RBS forced us into factoring, removing our overdraft facility while knowing it had full security on our property, which lead to the tail wagging the dog. We were advised our interest charges would be reduced by 75 per cent, but they in fact increased by 75 per cent.
Praseeda Nair is the editorial director of Business Advice, and its sister publication for growing businesses, Real Business. She's an impassioned advocate for women in leadership, and likes to profile business owners, advisors and experts in the field of entrepreneurship and management.
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