The Dash For Cash: Leaked Files Reveal RBS Systematically Crushed British Businesses For Profit

Buzzfeed:

The Royal Bank of Scotland killed or crippled thousands of businesses during the recession as a result of a deliberate plan to add billions of pounds to its balance sheet, according to a leaked cache of thousands of secret documents.

The RBS Files – revealed today by BuzzFeed News and BBC Newsnight – lay bare the secret policies under which firms were pushed into the bank’s feared troubled-business unit, Global Restructuring Group (GRG), which chased profits by hitting them with massive fees and fines and by snapping up their assets at rock-bottom prices.

The internal documents starkly contradict the bank’s public insistence that GRG acted as an “intensive care unit” for ailing firms, tasked with restructuring their loan agreements to “help them back to health”.

RBS has repeatedly denied allegations that it destroyed healthy businesses for profit – first raised in a damning report on its treatment of small-and medium-sized enterprises (SMEs) by the government adviser Lawrence Tomlinson three years ago. The bank paid the magic circle law firm Clifford Chance to conduct an “independent investigation” that found “no evidence” of the claims, and an official inquiry by the banking regulator has been long delayed.

The RBS Files now reveal for the first time that, under pressure from the government, the taxpayer-owned bank ran down businesses in its restructuring unit as part of a deliberate, premeditated strategy to cut lending and bolster profits. And they show that GRG, ignoring repeated warnings about conflict of interest, collaborated closely with the bank’s own property division, West Register, to buy up heavily discounted assets it had forced its customers to sell.

I’m confident that lessons have been learned and that this will not be repeated.

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