Review finds inappropriate treatment of SME customers
An independent review by the Financial Conduct Authority into the way in which an RBS division treated businesses has found there was widespread inappropriate treatment of SMEs.
The FCA has published an interim report into the investigation which looks into the conduct of the Royal Bank of Scotland’s turnaround division – Global Restructuring Group (GRG), which dealt with struggling businesses.
The section 166 investigation report found several failings, including that 92% of viable firms handled by GRG suffered “inappropriate action”, including interest charges being raised or unnecessary fees being added. The regulator’s report cleared the division in other areas.
The investigation into RBS was ordered on the back of a report by Yorkshire entrepreneur, Lawrence Tomlinson, who made a number of serious allegations against the bank.
Tomlinson, chairman of Leeds-based LNT group, in 2013 authored the Tomlinson Report which first exposed the unfair treatment of businesses in the Royal Bank of Scotland’s turnaround division .
Responding to the publication of the FCA interim summary, Tomlinson said that of the 40 allegations made in his initial report, the majority had been confirmed by the section 166 investigation and “some of the most serious allegations were found to be widespread and systematic.”
He added: “Banks do not treat their customers inappropriately, bankers do. For too long, shareholders have paid the price for the misconduct of individuals within banks who face no penalty and continue to make terrible decisions for the bank, their customers and UK economy alike. It’s time for that to stop.”
Tomlinson has called for the Financial Conduct Authority to look at the conduct of the individuals involved in senior management at the bank.
