The Financial Conduct Authority has confirmed it is investigating whether “further action” is needed against Royal Bank of Scotland (RBS) for the way it treated small business customers.
In 2013, then Business Secretary Vince Cable commissioned a report by Lawrence Tomlinson that alleged RBS of pushing SMEs to the brink of financial ruin for their own profits, sparking the FCA investigation.
The regulator published an interim summary of its independent review into RBS’ treatment of SMEs that were put into its Global Restructuring Group during the depths of the financial crisis.
RBS claims the most serious allegations have not been upheld, despite a litany of criticisms levelled at it by the FCA’s report. Today’s news, however, comes amid reports the police are conducting inquiries into the GRG units conduct.
Liberal Democrat leader Vince Cable said:
“RBS is trying to play down the significance of the findings in the interim FCA report.
"More than 90% of potentially viable businesses saw their cases mishandled and, even worse still, one in nine of all businesses thrown into the GRG division likely suffered material financial distress by RBS’ actions.
“These findings cannot be simply dismissed with what was, at best, a qualified apology from RBS’ chief executive.
"The report reaffirms the need for a robust regulatory regime to protect small businesses from being exploited by the banks, which still do not seem to have grasped the significance of the terrible pain they caused during the financial crisis.”