RBS probes its treatment of small firms

ROYAL Bank of Scotland has hired external advisers to launch a fresh investigation into its treatment of small firms.

The new inquiry will run along a separate probe by City watchdog the Financial Conduct Authority.

The FCA is investigating allegations that the bank pushed companies into its turnaround division, the Global Restructuring Group, so it could charge higher interest and fees and take over their assets.

A report published in 2013 by government adviser and entrepreneur Lawrence Tomlinson accused GRG of ‘killing off’ small firms for profit.

But these claims were rejected in a separate report by law firm Clifford Chance, which was appointed by RBS to carry out an internal inquiry.

Yet another report by former deputy Bank of England governor Sir Andrew Large concluded that the bank had failed its small business customers, but found no evidence of deliberate wrongdoing.

Despite this, RBS bosses said Tomlinson’s accusations were the biggest blow to the bank’s reputation. It is thought RBS is launching another review to ensure its responses to the FCA report are based on evidence gathered by an independent organisation, and are not swayed by efforts to protect its own reputation.

The lender, which is still 78pcowned by taxpayers, is keen to resolve the issue as quickly as possible as the Government prepares to start selling off shares back to the private sector.