© Reuters. THE BRITISH PARLIAMENT MAKES PUBLIC A DAMNING REPORT ON RBS
by Emma Rumney and Huw Jones
LONDON (Reuters) – The british parliament have made public on Tuesday, against the opinion of the authority of the market, a confidential report accused Royal Bank of Scotland (RBS) have penalized its customers in difficulty during and after the financial crisis.
“The conclusions of the report are outrageous,” said Nicky Morgan, who chairs the parliamentary Commission of the Treasury (Treasury Select Committee (TSC).
The TSC said in a release agreeing to immediately publish the report, not redacted, that contain the conclusions of the investigation concerning GRG, the entity restructuring of the bank RBS following its bailout by the State in 2008.
“The great priority at all levels of GRG was not the health or strength of the customers, but the generation of income for RBS, through commissions without basis, the high interest rates and the acquisition of shares and immovable assets”, added the president of the commission.
RBS denies the charges, the most serious of clients -in particular, on which she has deliberately pushed companies into bankruptcy to pick up their assets cheap. But she acknowledged some wrongdoing and spent 400 million pounds (453 million euros) of provisions to compensate businesses and attempt to restore his reputation ten years after the crisis.
The decision of the mps to publish the report result to a conflict with the French financial markets authority, the Financial Conduct Authority (FCA), which has commissioned the report but has refused to publish all of it.
The FCA, which continues to investigate the case, argues that on the legal level, it cannot publish report before giving the opportunity to the individuals named to answer.
HARASSMENT AND BULLYING
GRG has dealt with approximately 12,000 records of firms in difficulty between 2007 and 2012, and the report points out that of the 117 companies considered potentially viable, 92% of them have suffered improper treatment by RBS and 16% were in a “critical financial situation” of this fact.
The report concludes that the problems of the GRG were the result of mistakes of governance, which means that the commercial objectives of GRG did not take into account the risks they posed to customers that it had to help.
“It was not, we think, the result of decisions made by local leaders but a phenomenon endemic”, it is written in the report. “It was a failure in which the direction of GRG was aware (or should be).”
A document written by a team leader in one of the offices of GRG in detail the ways to make more money of customers in difficulty, with an invitation to a training session titled: “How to get a client to accept commissions plump and he will thank you for it.”
The report states that if a store managed by GRG is in bankruptcy, the bank teams were invited to serve.
The document also states that complaints of harassment and bullying.
RBS said it “deeply regretted” the way customers have been treated.
“The culture, structure and the way RBS have fundamentally changed,” says the bank, which was saved during the crisis thanks to an injection of 45.5 billion pounds of public money.
(Juliette Rouillon for French service, edited by Véronique Tison)