RBS executives admit profiting from the forced closure of businesses
MPs have accused Royal Bank of Scotland (RBS) executives of being “wilfully obtuse,” as they now make a U-turn on their defence – admitting to the deliberate sabotage of viable businesses in order to profit the bank.
In a revival of past allegations, the bailed out RBS was accused of deliberately bringing small businesses to the brink of closure, to force the selling of property to the retail arm of the bank.
These accusations were broadly defended against by Chris Sullivan, deputy chief executive of RBS and Derek Sach, responsible for the global restructuring group (GRG) – which is at the centre of the allegations.
Now, Sullivan has been forced to write a letter to Andrew Tyrie, the chair of the Treasury select committee investigating the alleged activity. Tyrie has lambasted the pair, stating, “RBS has now offered the committee what it euphemistically describes as ‘additional comments’.
“In fact, they have done a belated U-turn. It’s not as if the facts have changed. So it now appears that RBS has been wilfully obtuse with the committee.”
He added, “If this is how RBS deals with a parliamentary committee, how much can customers and regulators rely on it to be straightforward with them?”
The allegations originally surfaced when Sir Andrew Large, a former deputy governor of the Bank of England, warned that GRG, which was supposedly operating as a non-profit organisation within RBS, to help struggling businesses, was actually operating as a profitable entity – demanding small businesses be transferred over to its portfolio.
These accusations have been supported by Lawrence Tomlinson, an adviser to the business secretary, Vince Cable. Tomlinson compiled a report last year alleging GRG to be deliberately sabotaging businesses to make a profit for the bank.
Properties would be sold to the property arm of the bank, West Register, which owns more than 1,300 houses, flats and commercial properties such as care homes, pubs and hotels. It was established during the 1990’s recession.
Photo source: Elliott Brown via Flickr
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