The Scottish Mail on Sunday

Meat pies at mid­night, a £20m pri­vate jet and top bankers made to pull up weeds. How Fred the Shred lived in the lap of lux­ury ...and fos­tered a cul­ture of fear

- By Fiona McWhirter Printed and dis­trib­uted by Press Reader

HIS role in the fi­nan­cial cri­sis that al­most bankrupted Bri­tain is al­ready writ­ten into his­tory. Fred Good­win over­saw the col­lapse of RBS, which left one of the coun­try’s old­est banks need­ing a mas­sive, tax­payer-funded bail-out and saw him stripped of his knight­hood.

But while his fail­ure and hu­mil­i­a­tion have been played out pub­licly, the banker known uni­ver­sally as Fred The Shred is fac­ing a new se­ries of sen­sa­tional rev­e­la­tions.

A new book ques­tions whether he should ever have risen to the top of the in­dus­try, claim­ing the for­mer ac­coun­tant ‘ef­fec­tively lied’ to land his first ex­ec­u­tive bank­ing job.

Shred­ded, by Ian Fraser, is based on in­ter­views with more than 120 cur­rent and for­mer bank in­sid­ers, ex­ter­nal ad­vis­ers, politi­cians and oth­ers and shines new light on Good­win’s man­age­ment style.

Mr Fraser said last week: ‘Some ex-col­leagues sus­pect Good­win may have been a so­ciopath, a psy­chopath or have Asperger’s syn­drome be­cause of his as­ton­ish­ing abil­ity to switch from be­ing witty and con­vivial with a col­league over a few beers in a bar one evening, to be­ing vi­ciously bru­tal to the same col­league the next morn­ing.

‘Good­win didn’t seem to see any­thing un­usual in such ex­tremes of be­hav­iour. Ex­tremely com­pet­i­tive, Fred was un­able to ever ad­mit he had made a mis­take, which was one of the rea­sons he found fir­ing sen-

‘Col­leagues sus­pected he was a psy­chopath’

ior col­leagues dif­fi­cult. In­stead, he just tended to freeze them out.

‘He drove him­self and RBS hard. His whole per­son­al­ity be­came wrapped up in the fi­nan­cial suc­cess of the bank, which made it dif­fi­cult for him to ac­cept he bore so much re­spon­si­bil­ity for its near-to­tal col­lapse in Oc­to­ber 2008.’

Ed­in­burgh-based RBS is now 81 per cent tax­payer-owned fol­low­ing a £46 bil­lion govern­ment bailout.

In the book, fi­nan­cial jour­nal­ist Mr Fraser al­leges Good­win, now 55, ex­ag­ger­ated his part in the multi­na­tional liq­ui­da­tion of the Bank of Credit and Com­merce In­ter­na­tional (BCCI), see­ing him re­warded with top jobs at Cly­des­dale Bank and later at RBS which he might not other­wise have been of­fered.

Among those in­volved in the 1991 liq­ui­da­tion was ac­coun­tancy firm Touche Ross (later Deloitte) where Good­win, of Pais­ley, Ren­frew­shire, was the youngest-ever part­ner.

While six of his col­leagues were ap­pointed as liq­uida­tors and told to re­trieve as much money as pos­si­ble, Shred­ded claims Good­win’s role was to run the oper­a­tion’s of­fice. It says: ‘Fred Good­win ef­fec­tively lied about, or cer­tainly em­bel­lished, his CV. He did not “lead” and nor was he ever of­fi­cially styled “chief op­er­at­ing of­fi­cer” of the world­wide liq­ui­da­tion of BCCI, as he claimed. In fact, he had a cler­i­cal, back of­fice role.

‘He would have been un­likely to have got his jobs as CEO of Cly­des-

dale Bank and CEO of RBS if the truth had been known. Ar­guably, he got these jobs un­der false pre­tences.’

In the book, Ed­in­burgh-based fi­nancier Peter de Vink re­calls meet­ing Good­win: ‘Be­fore Fred ar­rived, I was told he had sin­gle-hand­edly led the BCCI liq­ui­da­tion. I ex­pressed as­ton­ish­ment. When I asked Fred about it over din­ner, he led us to be­lieve he was the sole part­ner in charge – at no point did he ac­knowl­edge that he was part of a team.’

Later, Mr de Vink met ‘the se­nior Deloitte’s per­son on the BCCI liq­ui­da­tion’, Brian Smouha, and told him he was un­der the im­pres­sion Good­win led the oper­a­tion. He says: ‘I’ll never for­get his face. With­out say­ing a word, Brian con­veyed the im­pres­sion he’d never heard any­thing so ridicu­lous in all his life.’

Whether his cre­den­tials were fab­ri­cated or not, Good­win be­came Cly­des­dale Bank’s deputy chief ex­ec­u­tive in 1995. But within days of his ar­rival at the head of­fice in Glas­gow, he had ‘alien­ated al­most the en­tire man­age­ment team’.

When he was pro­moted to the top job in 1996, aged 37, his ob­ses­sion with tidi­ness and decor be­came in­creas­ingly ev­i­dent.

The book re­veals: ‘One day, he forced a group of se­nior man­agers on to their hands and knees to pluck weeds from the car park.’

De­spite a fix­a­tion with workplace minu­tiae, his ex­tracur­ric­u­lar ac­tiv­i­ties were on a far grander scale.

In 2002, two years af­ter Good­win be­came RBS chief ex­ec­u­tive, the bank bought a £20 mil­lion Das­sault Fal­con 900EX ex­ec­u­tive jet.

Ac­cord­ing to Shred­ded, so great was Good­win and his wife’s per­sonal use of the plane that he found him­self in a row with the In­land Rev­enue, which claimed it should be re­garded as a ‘ben­e­fit in kind’ – adding tens of thou­sands of pounds to their per­sonal tax bills. The book says: ‘To avoid this, ex-in­sid­ers claim the bank trans­ferred own­er­ship of the jet from the Royal Bank of Scot­land Group to RBS’s Lom­bard Avi­a­tion leas­ing sub­sidiary.

‘This gave the im­pres­sion the Fal­con was not just a per­sonal play­thing for the chief ex­ec­u­tive.’

In June 2005, Good­win was said to have driven a £195,000 Lam­borgh­ini Mur­cielago at the Good­wood Fes­ti­val of Speed in West Sus­sex, but mis­judged a cor­ner and hit a crash bar­rier. The book says: ‘The brand new Lam­borgh­ini ended up on its roof, caus­ing £60,000 of dam­age.’ It claims Lam­borgh­ini and RBS staff were told to keep the crash quiet.

Shred­ded also says: ‘Good­win reg­u­larly vis­ited RAF Leuchars in Fife for joy rides in 111 Squadron’s Tor­nado F3 fighter jets. Ex-col­leagues claim he got a par­tic­u­lar thrill out of do­ing aer­o­bat­ics at Mach 2.’

The bank’s top 30 ex­ec­u­tives were ‘treated’ to quar­terly ‘mess din­ners’, at which a state-of-the-art karaoke ma­chine was in­stalled. The book says: ‘Each of the top brass was ex­pected to per­form a pop song of their choice in front of col­leagues as part of the en­ter­tain­ment.’

While Good­win loved to deliver his ver­sion of Don McLean’s Amer­i­can Pie, bankers de­scribed the din­ners as ‘ex­cru­ci­at­ing’. At mid­night, meat pies were de­liv­ered and they would drink un­til 3am – yet ev­ery­one was ex­pected to be at work fresh and on time later that day.

Even as RBS headed for col­lapse un­der Good­win’s ‘cul­ture of fear’, he seemed un­changed. Mr Fraser says: ‘He was os­ten­ta­tiously self­con­fi­dent when I met him in Jan­uary 2008 – at a time when the rot had well and truly set in at RBS and the bank was al­ready ma­nip­u­lat­ing its num­bers to mis­lead in­vestors.’

Good­win de­clined to com­ment on any of the claims.

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 ??  ?? SPEED FREAK: Fred Good­win used a £20m Das­sault Fal­con 900EX ex­ec­u­tive jet as RBS chief ex­ec­u­tive – and man­aged to crash a £195,000 Lam­borgh­ini Mur­cielago MESS DIN­NERS: Meat pies at mid­night would fol­low ‘ex­cru­ci­at­ing’ karaoke per­for­mances CUL­TURE OF...
SPEED FREAK: Fred Good­win used a £20m Das­sault Fal­con 900EX ex­ec­u­tive jet as RBS chief ex­ec­u­tive – and man­aged to crash a £195,000 Lam­borgh­ini Mur­cielago MESS DIN­NERS: Meat pies at mid­night would fol­low ‘ex­cru­ci­at­ing’ karaoke per­for­mances CUL­TURE OF...

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