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