The fallout over the Royal Bank of Scotland’s mistreatment of some small business customers continues, with a new investigation launching after the U.K. Financial Conduct Authority (FCA) decided not to take action against the FI.
Reports in Evening Express said the SME Alliance, a small business lobbying group, is launching its own investigation into RBS and the mistreatment of small businesses forced into its Global Restructuring Group. Some of those SMBs were pushed into insolvency, previous probes have found.
SME Alliance Director Nikki Turner is leading the new efforts to hold RBS accountable, reports said. Already, several RBS bankers have been jailed as a result of the scandal. But the FCA’s earlier decision to not take action against RBS, citing a limit of powers, has reignited frustrations in the small business community.
“Our members are extremely frustrated that the regulators are unable to take any action against RBS and its bankers,” Turner said in a statement. “The FCA says it cannot find any way to take action – we aim to help them ensure the guilty bankers are brought to book.”
The investigation will aim to gather “evidence of dishonesty and lack of integrity by RBS executives,” reports said. The SME Alliance will seek to have the FCA take action in response to that evidence, pointing to the Senior Managers Regime (SMR) legislation.
SMR came into effect in 2016 and cannot be enforced for past actions. However, according to reports, the SME Alliance expects to uncover evidence that will show RBS covered up misconduct after the SMR came into effect.
Neither the RBS nor the FCA commented, the publication said.
The watchdog announced last month that it would not take action against RBS. “After carefully considering all the evidence, we have concluded that our powers to discipline for misconduct do not apply, and that an action in relation to senior management for lack of fitness and propriety would not have reasonable prospects of success,” said FCA Chief Executive Andrew Bailey at the time.