It’s been reported that the Royal Bank of Scotland allegedly boosted profits by putting the squeeze on struggling small businesses. Confidential documents, passed by a whistleblower to BuzzFeed News and BBC Newsnight appear to suggest the bank bought up assets cheaply from failing businesses despite claiming to be helping them.
In what was billed “a dash for cash” it’s implied that staff at RBS could boost their bonuses by finding firms that could be squeezed. This is said to have involved them searching for companies that could have their interest rates bumped up or be restructured.
Around the time of the 2008 financial crisis more than 12,000 firms were put into its Global Restructuring group. This figure is reported to have risen to over £65billion between 2007 and 2012.
It’s claimed that at least 140 businesses are in the process of suing the bank for as much as £1billion, saying the GRG unit pushed them into administration.
RBS said it had let some small business customers down in the past but denied it deliberately caused them to fail.
The Financial Conduct Authority is now probing the claims.