19 June 2018
“Lord Turnbull” report exposes lies perpetrated by Lloyds and HBOS
The publication of a “secret” internal Lloyds Banking Group report shows how victims of the HBOS Reading fraud have been misled and mistreated by the bank for many, many years. SME Alliance, which supports many of those victims, has long maintained that not only did the management of HBOS and Lloyds publicly understate the extent of the fraud, but that they misled victims, shareholders and the public about what they knew and when.
The “Project Lord Turnbull – Operation Hornet” report, written at the request of a senior member of Lloyds’ finance team, was delivered to Lloyds management and its legal advisors, Freshfields Bruckhaus Deringer, in January 2014, more than three years before two ex-HBOS bankers and five others were found guilty of deception and other charges over the HBOS Reading fraud. The report was published today by a campaigning businessman, and reveals the extent of the fraud, the criminal
behaviour of HBOS bankers and the fact that both were covered up by the bank.
SME Alliance has long pressed for the contents of the report to be revealed as they show that senior managers at Lloyds hid behind a lie that they were not aware of any criminality. This led to Lloyds and HBOS keeping victims waiting for a decade or more before any compensation for losses. It also meant that the offers made to victims under the Lloyds review, run by Professor Griggs, have been predicated on the lie that Lloyds only became aware of criminality in January 2017.
“Victims have suffered terrible hardship, leading to bankruptcy, divorce, mental problems and attempted suicides, because the bank compounded the original fraud by perpetrating a lie,” said Nick Gould, chair of SME Alliance. “What this report says is that shareholders – who for a long time included British taxpayers – victims, regulators and politicians were repeatedly misled by those running HBOS and Lloyds. Both the National Crime Agency and Dame Linda Dobbs QC are now
investigating the cover up and this report will no doubt inform their deliberations with the obvious implication that senior people at HBOS and Lloyds will have to be called to account.”
SME Alliance be will writing to Lord Blackwell, chairman of Lloyds, raising a number of issues emerging from this report around the treatment of victims and correspondence with those victims going back to 2007.
SME Alliance was formed in September 2014 to support SMEs “battling against fraud, corruption and misconduct in the financial sector” and to lobby for the fair treatment of businesses by their banks and advisors.
For further information contact Jason Nisse on 07769 688618 email@example.com
Unfortunately, earlier today our firstname.lastname@example.org email address was down. We have now corrected this and it is back up and running. If you have tried to contact us via email today between the hours of 2pm-8:30pm, we unfortunately will not have received it and would ask that you please resend these emails. We apologise for any inconvenience caused by this.
Andrew Bailey, CEO
The Financial Conduct Authority
25, The North Colonnade,
Canary Wharf, London E14 5HS
7th May 2018
Dear Mr Bailey,
At a time when more and more bank misconduct is being exposed in the public arena and when more than ten years since the HBOS Reading fraud was first uncovered, we saw bankers jailed, more and more people are naturally becoming concerned about the role of the regulators and what they will do or are doing following the most recent revelations. In particular, many of our members would
like to know what action the FCA (and the FOS) will take for the numerous, serious breaches - possibly criminal - of regulations by the GRG division of RBS now the section 166 report into that conduct is readily available to the public?
Please don’t think this letter is about allegations and grand standing, that is not the point at all. It is far more important than that. Our members are genuinely concerned that, in many cases, the regulators are giving the impression of working to protect the banks and conceal the misconduct of certain directors, senior executives and others. Such a scenario, as we suggested in our letter to you
in August 2017, can only result in serious miscarriages of justice because, for example, the judiciary may have been misled about the conduct of RBS/GRG. If nothing is done now to penalise and curtail such conduct, then the judiciary will still be in the dark and the same miscarriages of justice will continue to occur.
We would like to be able to say that, in the last year we have seen the situation between SMEs and the major banks improving. Unfortunately, the opposite is true. We are seeing cases coming in huge waves. Frequently we get a spate of cases coming in from a specific bank (and this is not just limited to RBS or Lloyds) over short periods. Unannounced drive-by valuations crippling clients’ loan to value, instant removal of overdrafts, removal of loans with no explanations, the immediate instruction of LPA Receivers, calling in of personal guarantees on directors’ homes because regulated mortgages are subsumed by unregulated commercial guarantees – these are just a few of the issues that are devastating and destroying our members and of course many more of whom we have no knowledge, on a daily basis and at a time when we are led to believe banks are somehow being made to behave.
We would ask you to consider the following four points and give us your comments for us to pass on to members. It may be that lack of transparency possibly due to Section 348 of FSMA 2000, means you are doing more to remedy the situation of how banks treat SMEs than the public know. Therefore, we would ask for as much transparency as you can give and which may help members
understand your intentions and policies going forward. With the limited knowledge we have of what is happening in the regulatory arena, it does seem the regulators are continuing to protect banks rather than regulate them. We are naturally concerned.
Our members biggest concerns are:
Repeatedly we have heard the question asked - how banks will regain public trust? Our members are concerned that until we can have trust in our regulators, we will never be able to regain trust in our banks because surely, until misconduct in the financial sector is seriously challenged, those who find it advantageous to exploit SMEs will simply continue to do so. An obvious example of this is how the
HBOS Reading fraud was able to cause absolute misery and distress for SME clients for many years and until the culprits were jailed in 2017, even although the bank identified serious irregularities about the conduct of Lynden Scourfield and started its investigations as far back as 2006.
Perhaps there has never been a more damning document (that we the public know of thus far) than the section 166 report into RBS GRG so we would like to know, what action is the FCA going to take against those executives of RBS who oversaw, sanctioned and allowed such despicable policies to operate in a state bailed out bank? A bank which of course is likely to be the subject of a multi-billion
dollar fine in the USA in the very near future. The lack of transparent action to date by the FCA suggests the report has come and gone and both the Bank and the regulator just hope the SME Sector and the public will forget about it. Without doubt, those affected are not in a position to forget RBS GRG as they are still living with the consequences and RBS (by no means exclusively) is still, in many cases, persecuting its customers.
We sincerely hope the victims won’t have to wait another 10 years for justice as was the case with HBOS Reading. Who, if not the FCA, do you advise SMEs and the public to rely on to make our banking system fair, safe and reasonable? Additionally, to who, given the disappointing performance of the FOS, should SMEs address their concerns and complaints?
We are in the process of collating information our members have made available, so we can compile a report for the FCA, the APPG on Fair Business Banking and the TSC which we hope will give maximum clarity and insight about the horrendous treatment so many SMEs are still receiving. We hope this report, which should be finished by the end of June this year, will prove useful to you and
other authorities. In the meantime, any enlightenment you can give on what will happen next regarding the Section 166 GRG report, would be gratefully received.
Finally, may we remind you that the issues raised in this letter are in no way academic. They affected and continue to affect real people with real lives, many of whose lives have been totally and utterly destroyed, through no fault of their own. We thank you in advance for your attention to this letter and look forward to your reply.
Nicholas S B Gould (chairman of SME Alliance) and Nikki Turner (director of SME Alliance)
SME Alliance Ltd. Company No. 09280003. Registered address: 3 Morley's Place, Sawston, Cambridge, CB22 3TG www.smealliance.org email@example.com
30 March 2018
Funding options available to SMEs.
The SME Alliance was formed in September 2014 to support SMEs “battling against fraud, corruption and misconduct in the financial sector” and to lobby for the fair treatment of businesses by their banks and advisors. This submission is based upon the experiences of our members in their dealings with some of the largest and most prominent financial institutions operating in the UK.
The availability and uptake of different sources of funding for SMEs, including banks, peer-to-peer lenders and crowdfunding
It is not easy for SME Alliance members to be considered in the general category of SMEs looking for funding. In the majority of cases our members have legacy issues which means they do not fit the criteria for bank lending. Even where banks have been proven to have abused clients and been heavily penalised, it doesn’t follow those clients will have their credit rating restored or that potential lenders will consider the circumstances surrounding legacy issues. Therefore, the experience of our members is possibly not a true reflection of the availability of funding to the SME market and this situation is currently excluding funding to thousands of SMEs.
Understandably those SMEs who have been abused by banks are also nervous of entering into any agreement with lenders because there are no safeguards in place to ensure the same or similar misconduct won’t happen again - especially as banks can and frequently do attack personal properties (homes) which are no longer protected by regulatory structures (MCOBS etc) once they are used to secure unregulated commercial lending.
All the same, businesses do need funding – especially where owners are trying to rebuild businesses post mis-selling or unethical ‘business support units’ etc - and, in too many cases, the only funding readily available is ‘bridging finance’ at crippling interest rates. This has been particularly true for the farming sector where bridging loans (given on the grounds the agents involved would then source mainstream lending) has resulted in tragic results.
The level of competition in the SME lending market and the impact of recent regulatory initiatives
We’re not sure what impact regulatory issues or initiatives have had which could improve either competition or lending from major banks? Commercial lending is still unregulated and, other than large fines, we have seen little that has changed – except perhaps the fact lenders seem even more reluctant to lend and are even more keen to ensure terms of lending are onerous and biased in their favour. The introduction of a few challenger banks and the British Business Bank hasn’t changed the ethos of lending – which is to maximise bank profits at all costs and even where that gain will obviously damage the client. Despite inspirational advertising campaigns suggesting banks will support small business and even cancer victims or those with mental health issues, the criteria for lending remains largely unchanged. A loan or overdraft facility is still mostly a tick box exercise and nothing to do with the former relationship-based lending where a manager knew his clients and their potential. We’re noticing also that challenger banks, who suggested they would operate new models of lending, are also reverting to the classic corporate model of the big banks.
Trends in SME finance and how potential changes to regulation and redress may affect the market
If the trend before the credit crunch was to lend, lend, lend and with a minimum of security, it does seem the trend now is to lend sparingly and with maximum security – although we note it is frequently reported in the media that SMEs are not applying for bank lending – which we would question. Possibly the introduction of more stringent regulation (although we are unaware of what this is) will make lenders even more reluctant to lend. How will this affect the market? SMEs can’t say but business owners, business groups, economists and politicians all say the minimum funding filtering through to SMEs and stifling growth, is affecting GDP.
Any sources of finance which SMEs will not consider or approach and why
It would be good to say SME owners won’t use bridging finance from companies with a proven track record of never progressing the loans to main stream despite endless promises. But all too often desperate business owners do resort to this. Similarly, it would be good to say SMEs don’t revert to using the equivalent of pay day loans or loan sharks in order to keep paying bank loans or IRHP repayments. Unfortunately, people with their backs to the wall who are trying to save their business, their home, or both, are very often in a position where any loan is better than no loan.
The ability of SMEs to resolve disputes and access fair and reasonable compensation when they borrow money.
Please see next point below.
The effectiveness of existing arrangements for dispute arbitration and settlement
Unfortunately, the existing arrangements are at best ineffective and at worst non-existent. And this sorry situation is as contributory to the abuse of SMEs as the conduct of the banks themselves. The Financial Ombudsman Service is not only ill equipped to deal with SME complaints in terms of its ability to compensate, it has also been exposed to be totally inefficient, inept and negligent – which is something too many SMEs have already discovered to their cost.
The victims of mis-selling or other bank abuse have three choices for resolving serious disputes. In most cases they are all impossible:
1. The Banks internal complaints procedure - We would suggest that in SME cases or indeed in any case where the Bank might have to pay out more than a few hundred pounds, it is a waste of time expecting any satisfaction from the banks. Additionally, it is extremely time wasting and we have members who are still waiting for a reply from banks internal complaints divisions, several years after they made their complaint. Time is of the essence for business owners who need to keep their businesses going even while dealing with banking disputes. Banks are fully aware of this and we suggest the internal complaints divisions are step one of the banks 3D system of ‘delay, deny, dilute.’
2. Resolution via the regulators - as mentioned above the FOS are ill prepared and cannot award suitable compensation and the FCA does not deal with individual cases.
3. The civil courts - with increasingly less (or no) legal aid, ever increasing court costs and legal costs vs Banks who are happy to spend millions of pounds of their shareholders money when sometimes the alternative would be to pay a fraction of that to resolve legitimate complaints, the Civil Courts are not an easy option. For those who get around this by entering into Conditional Fee Agreements (CFA) with legal firms, or No Win No fee agreements, the outcomes are not always the best. Very often it is written into these agreements is the fact the firms can compel the client to accept an offer from the lender – which is sometimes little more than the cost of the legal fees. Also, many SME owners who have genuine claims have been hampered because it has taken an inordinate amount of time to obtain information from the Banks – with some SMEs not even aware of the actions that forced them into difficulty – and so have been prevented from taking legal redress because of the statute of limitations on civil actions which prevent claims for activity more than six years old.
At present there isn’t any other route available to most SMEs which is ridiculous given how many cases have been proven collectively against the banks. Recently, Lloyds Banking Group has successfully used mediation to resolve some of the HBOS Reading cases but such opportunities are few and far between and most victims of recognised systemic abuse are forced into wholly inappropriate review schemes set up and run by the Banks themselves. These schemes (such as the Griggs Review for HBOS Reading and the RBS GRG Review) are, if not sanctioned by the FCA, are generally approved by the regulator. Again, we feel the Banks, with the agreement of the regulators are using these schemes as little more than a silk glove to hide yet another steel fist. The very fact some banks can pay minimum compensation for years of financial loss and distress to their customers and then get away with paying a mere 8% for consequential loss, is just one more example of how bad the current ‘arrangements’ are. It has now become standard and acceptable (by regulators) that the actual consequences of Banks first, deliberately ruining a business, and then spending years denying this has happened, can be ignored. Over and above the actual losses to the businesses, it is rarely the case the level of compensation will go anyway to mitigating years of stress and anguish or the personal losses to the business owners.
While senior bankers continue to be paid huge fees and bonuses for overseeing and allowing so much misconduct to exist and continue, we have seen compensation equivalent to a few weeks or even a few days of a senior banker’s fees offered as compensation for years of abuse and denial to business people.
The merits of the Financial Conduct Authority’s proposals for expanding SME access to the Financial Ombudsman Service
In 2017 at a Committee on Regulation in Westminster which SME Alliance was able to participate in, we asked two representatives of the FOS the following questions:
1. What qualification do you need to be an adjudicator for the FOS?
2. Of the 2000 employees at the FOS, how many people fully understand complex financial products like IRHP or TBL’s?
The answer to the first question was “none”. No specific qualifications are needed. The answer to the second question was “five”. And even then, this wasn’t a definitive answer.
These people make decisions every single day that could and sometimes do ruin lives. While many of us have long known this was the case, the Dispatches programme (13th March 2018) has now exposed publicly exactly how unsatisfactory the whole FOS is. We have attached a transcript of the programme to our submission and we would ask how anyone could suggest this organisation should have additional powers or indeed any powers? Please note, our comments are not a criticism of the adjudicators per se as they obviously cannot be expected to do a good job without the training, knowledge or experience necessary to do a good job and we noted the frustration many expressed in the Channel 4 documentary. Our comments are a definite criticism of both the senior management of FOS (and the FCA) who have allowed such an inadequate and inappropriate system to exist for so long.
The case for establishing a new “tribunal” body for settling SME banking disputes and the means by which such a body could be created
SME Alliance has been asking for an alternative to the FOS. In March 2015 at the request of Andrea Leadsom MP, we documented how we thought an alternative would work and we submit that document with this submission. We know that since then the APPG on Fair Business Banking has been collaborating with various people and organisations like SME Alliance and the barrister Richard Samuels.
The design, governance and operation of such a tribunal body, and the potential relationship between it, the Financial Ombudsman Service, and the Financial Conduct Authority
Without doubt who ever is given the governance of such an organisation, it absolutely should include the voices of those who have been most affected by banking disputes and also those who have had direct dealings with victims of bank abuse. While the recent involvement of more MPs, Lords and Ministers in raising the issues of dispute between the financial sector and SMEs is much appreciated and is definitely having an impact, we still have a situation whereby committees are formed and important discussions take place – about other people (victims). But many of the victims are very eloquent, rational people whose explanations and experience would be of enormous assistance to those trying to find resolutions. We give the example of the Treasury Select Committee who regularly pose questions to bankers, regulators, auditors etc but, to the best of our knowledge, they do not pose questions to those business people who might be able to legitimately challenge what others have had. Were that the case, situations where senior bankers from RBS stated adamantly to the TSC that GRG was not a profit-making division of the bank, could have been disproven immediately.
The impact of additional avenues for redress on (i) the balance of power between SMEs and lenders; and (ii) the supply of, and demand for, credit
It cannot be the case banks do not want an ADR system to compensate SMEs purely for economic reasons. Possibly the so called ‘professional’ services associated to banks would have that objection because the very lucrative flow of monies to Magic Circle solicitors, auditors and IPs would be considerably less if SMEs could resolve their issues quickly, cheaply and easily (or fairly easily) via a Tribunal system. Banks would undoubtedly save multiple millions if not billions if such a system were to exist.
However. it is questionable whether banks would be happy to relinquish the power they’ve had over the last twenty years quite so easily. A level playing field wouldn’t just bring about resolutions for misconduct done, equally importantly, it would also challenge Banks ability to continue abusing customers.
It is a fact many business owners have not only been subject to misselling or fraudulent conduct, they’ve also been subjected to bullying, intimidation and harassment. This kind of behaviour has been particularly successful in allowing the theft of assets. While some SME owners will not be bullied it’s a sad fact many are because they’re over a barrel. “Do what we say or we call in your loan”. “Do that or we call in your personal guarantees.” In many cases it really is as blatant as that and these threats are enforced. They use the good guy bad guy tactic but usually with the intention the bad guy wins on the instruction of the more senior good guy.
Again we use the example of HBOS Reading where a very senior banker re-opened a victims account and gave the client a new facility. But at the same time the banker instructed his colleague who would be running the account, to give it four weeks and then ‘wrap it’ – in other words, close the business down which he did – in the most unpleasant way possible.
We would suggest some banks have been deliberately employing people who were capable of such conduct because only they would ruthlessly behave in this way in order to achieve bank targets and also to achieve bonuses. Such conduct, where established, would not go down well in a Tribunal setting, although having said that, it has been materially ignored in the civil courts for a very long time.
The regulation of SME lending.
The level of protection currently afforded to SMEs when they borrow money
At present there is no protection for SMEs. Commercial lending, as the FCA repeatedly remind us, is mostly unregulated. More unfortunate still is the fact most SME owners don’t realise they have no protection until it’s too late. In almost every case SME Alliance has seen, the business owners have written to the Financial Ombudsman or the FCA in the belief these organisations would actively be able to help them. In almost every case this hasn’t happened.
The Banks frequently require personal guarantees from SME owners as a pre-condition to advancing funds to the business, often in addition to other security. At present these arrangements are considered commercial lending and are outside the scope of the FCAs powers, but we would argue that, as the SME owner is putting his or her personal wealth, and often family home, at risk, this is an extreme version of personal finance and should be regulated as such.
The use of personal guarantees should be investigated and, at the very least, a code of conduct should be drawn up around their suitability and application.
The case for bringing lending to SMEs within the regulatory perimeter, including (i) the likely impact on the supply of, and demand for, credit; and (ii) lessons learned from past misconduct.
It’s certainly true many SMEs are now nervous of getting funding from banks but on the other hand, SMEs do need funding and the option of not applying for it is stifling growth in the sector. While in theory SMEs may be more comfortable with Bank funding if it was regulated, the issue still remains that many SMEs don’t trust the regulators to deal effectively with bank abuse and misconduct. Additionally, what would change about the fact the FCA doesn’t deal with individual cases? Would this still apply if the lending was regulated or would it still be the case the only people able to deal with individual cases is the FOS? If an organisation like SME Alliance went to the FCA with 20 or 30 similar fact cases, what difference would it realistically make to the present long winded system of initial complaints potentially leading to a Section 166 review, leading to a possible Section 168 review and an eventual decision that may, or may not be published?
An example of this is the HBOS Reading case which was reported by the victims in 2007 and led to a Section 166 skilled persons review on 19th October 2009 (the same day some of the victims delivered a comprehensive report to the FSA and over three years after HBOS started its internal investigations of the fraud). The section 168 review was started on 28th June 2010 – there has been no outcome almost eight years later even although six people have been jailed for a total of 47.5 years.
Would the time scales of these regulatory investigations have been shortened because the lending from HBOS Reading was regulated?
All the same, it would obviously be advantageous for SME lending to be regulated but only if the regulator was inclined to enforce those regulations.
Other non-regulatory or quasi-regulatory options for policing SME lending, such as the establishment of industry codes and standards
We have codes – the FCA Principles for Business – the BBA codes – the banks own voluntary codes. We also have codes for all the ‘professional’ industries who work with the Banks like lawyers, accountants, auditors, Insolvency Practitioners, estate agents, surveyors…. They all have regulators, they all have codes and some of them have enabled a massive fraud against the public and SMEs. Again, the problem isn’t necessarily just the misconduct of the bankers but rather all of those who make large amounts of money by enabling bank misconduct. Bankers and associated ‘professionals’ have got used to the huge rewards they get and many seem to feel an unhealthy entitlement to keep getting the rewards by hook or by crook. All the codes in the world are not going to change a culture that values the accumulation of wealth above all else. Until funds are in place to allow police forces to deal with economic crime and until bankers have to consider how much the value their freedom vs how much money they can make by manipulating existing codes and standards for financial gain, it seems pointless to introduce more.
For further information contact Jason Nisse firstname.lastname@example.org 07769 688618
The Financial Ombudsman Service (FOS) is being forced to disclose how widely bankers from RBS used a “confidentiality stamp” to try to prevent disclosure of sensitive documents to its own customers, after a landmark case.
SME Alliance member David Howells appealed to the Information Commissioner (ICO) over the FOS’ refusal of a Freedom of Information Act request to disclose how widely a “confidentiality stamp” had been used by RBS to prevent sensitive documents about customers being shared with the customers after they had made complaints to the FOS.
A complaint had been made by Mr Howells over the handling of a complaint he’d made after RBS subsidiary NatWest stopped his debit card while he was attending a family event in Brazil, despite being told in person by Mr Howells that he was travelling to Brazil.
Mr Howells appealed to the ICO after finding that documents in his case had been stamped; “This information contains CONFIDENTIAL INFORMATION relating to RBSG's commercial business activities which if disclosed by FOS to the complainant or to any third party would be likely to adversely affect our legitimate business interests.”
The FOS said that the demand for disclosure was “vexatious” and would create an undue administrative burden.
However, the Information Rights Tribunal rejected the FOS’ argument, and the
ombudsman has agreed to conduct a review of 600 cases spreading over three years–2012-2014– to reveal how widespread the use of this confidentiality stamp was. It will report back by 30 April.
Mr Howells was supported in his action by the SME Alliance.
Andy Keats, director of the SME Alliance, said: “This is a landmark case showing how the banks and regulators appeared to conspire to hide information from customers. This ruling will put the banks and regulators on notice that transparency is key if they want to treat customers fairly.”
The SME Alliance was formed in September 2014 to support SMEs“ battling against fraud, corruption and mis conduct in the financial sector” and to lobby for the fair treatment of businesses by their banks and advisors.
For further information contact Jason Nisse on 07769 688618 email@example.com
13 February 2018
Businesses harmed by RBS’ GRG have been failed by the regulator – twice – says SME Alliance
The leak of the Financial Conduct Authority’s Section 166 Report on the GRG Division of RBS shows that the regulator has failed in its duties not once, but twice.
Not before time this damning report has finally been placed in the public domain. While this will be extremely helpful to many of our members, we are disappointed and concerned that the FCA, which so many SMEs have relied on for ensuring banks followed their principles and acted with integrity, did not release the report itself and it was down to businessman Neil Mitchell and his colleagues to expose the report.
The report’s authors found that “inappropriate treatment” by the RBS GRG team led to “material financial distress” for one in six of the business studied. The scope of the study took in 5,900 companies, though there is evidence that more than twice that number were referred to GRG and other similar units within RBS.
Nikki Turner, director of the SME Alliance, said: “If RBS had treated customers fairly, and the financial regulators had not been asleep at the wheel, there would be around 1000 and maybe as many as 2000 businesses still operating, making money, employing people, contributing to the British economy.
“It is ironic therefore that a consumer has taken the responsibility to publish a report that should, in our opinion, have been published by the regulator years ago. The lack of transparency has no doubt, as we pointed out to Mr Bailey (CEO of the FCA) last August, led to potential multiple miscarriages of justice and without doubt, wholesale misery for many SME owners and their families.
“The FCA bodged the publication of this report, showing it was more interested in protecting those it regulates than those it is supposed to serve.”
The SME Alliance also notes that FCA, which previously included “consumer protection” as one of their remits, has now altered this to “Consumer responsibility”.
It defines Consumer Responsibility as “The general principle that consumers should take responsibility for their decisions.” This is a weakening of the remit to protect customers of the banks
The SME Alliance directors will be studying the report in detail and encouraging all our members to do the same. We would like to thank Mr Mitchell and all those who have made this happen.
The SME Alliance was formed in September 2014 to support SMEs “battling against fraud, corruption and misconduct in the financial sector” and to lobby for the fair treatment of businesses by their banks and advisors.
For further information contact Jason Nisse on 07769 6886618
19 January 2017
Government needs to act after full extent of SME banking scandal highlighted by MPs
The SME Alliance, which supports SMEs battling against fraud, corruption and misconduct in the financial sector, has demanded that the Government listens to call for action from MPs of all parties who highlighted the atrocious behaviours of banks and their advisors to SMEs.
More than 30 MPs, representing all the major parties in England, Scotland, Wales and Northern Ireland, spoke at Thursday’s debate highlighting appalling cases of business people losing their business, livelihood, homes and families because of the actions of the banks and their professional advisors and demanding redress.
This was followed by a joint meeting of the SME Alliance and the All-Party Parliamentary Group of Fair Business Banking, where MPs including Clive Lewis and Norman Lamb, who sponsored Thursday’s debate, Kevin Hollinrake, incoming chair of the APPG, and Bill Esterson, Labour’s business spokesperson, joined a discussion with Anthony Stansfeld, the Police and Crime Commissioner for Thames Valley, and former MP George Kerevan, and business people harmed by the banks. Further examples of how the banks and advisors used bullying tactics to squeeze money out of SMEs, often causing them to lose their businesses, were aired.
Among the demands from MPs were for a tribunal that can deal with disputes between SMEs and their banks, as this part of banking is not under the remit of the Financial Conduct Authority. John Glen, The Economic Secretary to the Treasury, said: “It is important to recognise the fundamental need for financial providers to act in accordance with the rules of the FCA and the spirit of its principles. When they do not act in accordance with those principles, we need to have confidence in the mechanisms that exist to resolve disputes.”
Nikki Turner, director of SME Alliance said: “The Economic Secretary appears to be moving in the direction of setting up a tribunal but what we need to see is concrete action from Government to redress the power imbalance between SMEs and their lenders.”
The SME Alliance, which was formed in September 2014 to support SMEs “battling against fraud, corruption and misconduct in the financial sector” and has led the fight for compensation for businesses harmed by the fraud at HBOS Reading (now owned by Lloyds Banking Group) and RBS, has committed to continuing the fight for victims of all the dreadful actions of those and other banks and their advisors.
Said Nikki Turner: “Yesterday’s debate showed the strength of support from all sides of the political spectrum for our fight and the banks, and their henchmen, should be on notice that we will be on their case.”
For further information contact Jason Nisse on 07769 6886618 firstname.lastname@example.org
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