The Royal Bank of Scotland (RBS) is being sued for £4 billion by a group of shareholders angry at the way the bank handled the 2008 financial crisis.
The RBoS Shareholder Action Group today issued legal proceedings today against four former RBS employees – CEO Fred Goodwin, chairman Tom McKillop, investment banking chief Johnny Cameron and finance director Guy Whittaker – as well as the bank itself.
The 12,000 shareholders taking action are said to manage over £200 billion in assets and include charities, church groups, pension funds and private clients.
The four men are accused of seeking to “mislead shareholders by misrepresenting the underlying strength of the bank and omitting critical information from the 2008 rights issue prospectus”.
RBS launched the rights issue in April 2008, offering existing shareholders the opportunity to buy £12 billion of shares in order to shore up its finances during the financial crisis of that year.
These shares dramatically dropped in value amid RBS’ near-collapse, before it was bailed out by the UK taxpayer.
A spokesman for the action group said, “Today represents a giant step forward for the many thousands of ordinary people who lost money as the result of inexcusable actions taken by banks and their directors in the financial crisis.
“Now, for the first time, some of these directors will have to answer for their actions in a British court.”
In February, RBS revealed it had made a £5.17 billion pre-tax loss in 2012 – more than three times the £1.2 billion it lost in 2011 – yet still shelled out £607m in bonuses to its employees.
It was fined £390m for its role in rigging Libor and also recorded a payment protection insurance compensation pot worth £1.7 billion.
Laura Willoughby, chief executive of campaign group Move Your Money, said, “If the bank is found to have misled and mis-sold to investors, it will be the British taxpayer that ends up footing the bill for RBS once again.
“When will banks learn that mis-selling and misleading customers is not an acceptable way to do business?”
RBS has 30 days to respond to the legal proceedings from the action group.
Like our Facebook Page
Can You Use Your PC In an Eco-Friendly Manner?
How Pain Management Hurts the Environment, and What You Can Do to Help
4 Countries That Have Banned Single-Use Plastic
What Is Your Carbon Footprint and How Can You Reduce it?
How Business Leaders Can Positively Impact Water Scarcity
Plant-Based Protein Coffee is Eco-Friendly & Healthy
Eco-Friendly Restaurants That Are Bringing the Outside Inside
5 Environmental Benefits of Custom Manufacturing
How to Reduce the Carbon Footprint of Your Office
Benefits of Starting an Eco-Friendly eCommerce Business
Brian Sheth and Sheth Sangreal Foundation Donate $15 Million to Global Wildlife Conservation
Eco-Friendly Gardeners Can Make Compost from Organic Waste
8 Great Tips to Find an Eco-Conscious Moving Company
Can Employers Help the Planet with Work from Home Policies?
Creating a Green Basement Environment for a Healthier Home
Switching to an Electric Car to Help the Environment? Here’s How to Find the Cheapest Insurance
More People Are Practicing Eco-Conscious Lawn-Care
Choosing the Best Air Filter as Pollution Levels Worsen
9 Tips to Write Stellar Papers as an Environmental Science Major
Why You Need to Know These Hard Facts About Ethical Investing
- Energy3 months ago
How To Choose the Right Solar Inverter for Your Home?
- Energy3 months ago
How to Choose the Best Solar Panel for Your Home
- Environment10 months ago
Importance of Using a Water Purifier in an Area with High Pollution
- Environment3 months ago
Reduce Industry Footprints with Sustainable Material Swaps