Morgan gains cross party support in demands for answers over RBS business group scandal

Treasury select committee chair Nicky Morgan has now been joined by a group of MPs in demanding that the Financial Conduct Authority release its full report on Royal Bank of Scotland’s treatment of its business customers.

Mrs Morgan has written to Andrew Bailey, chief executive of the City watchdog demanding its handing over of its findings on the conduct of RBS’s Global Restructuring Group after a leaked document appeared to disclose that investigators have found “inappropriate action” was experienced by 92 per cent of its customers.

Accusations have long been levelled at 73 per cent state-owned RBS that it purposely pushed small businesses into financial hardship so they could be put into the GRG where they could be asset stripped.

Mrs Morgan’s intervention comes after the leaked document, seen by the BBC, found that struggling companies who were placed in the recovery group, which operated between 2005 and 2013 and at its peak handled 16,000 firms, had little chance of emerging from it.

The findings of an investigation into the affair was originally to be published in 2015.

Then, the FCA told the Treasury select committee in November last year that a ‘full account’ of the findings from the skilled persons’ investigation into the GRG would be published.

“Nearly a year later, and nearly four years since the report was commissioned, we are still waiting for answers,” Morgan wrote in her letter. “The report itself is now in the hands of an unknown number of third parties. The FCA now has no control over the timing or content of further public disclosures from it.

“The balance has tipped firmly in favour of full publication. I have written to Mr Bailey to urge him to secure the approval of RBS to do so, without delay.”

Conservative MP Morgan said: “This would not be the first instance of leaking from the FCA, but lessons must be learned to ensure it is the last.”

News of a further letter emerged today, this time from MPs comprising the all party parliamentary group on fair business banking and finance, showing that they too are demanding the report be made public.

The letter calls RBS’s treatment of business customers an “ugly stain” on the UK financial services industry and asserts that while details of the “focus and execution” of the investigation remain hidden from public view there cannot be confidence that the probe has identified the scale and damage of the poor behaviour at RBS, nor whether there has been an adequate response from either the bank or the FCA.

The head of the group, Lord Cromwell, is meeting Mr Bailey next week.

Responding to Mrs Morgan’s letter, an FCA spokesperson said: “We have received the TSC’s letter and will respond in due course. We have already initiated a leak inquiry into the disclosure of the s166 report on RBS GRG to the BBC, and we have asked the other parties who had access to the report, namely RBS and Promontory, to do the same.

“If the Treasury Select Committee or the BBC have evidence that the document was leaked by the FCA, we encourage them to share that with us.”

RBS is understood to be investigating the source of leak, which is just the latest of many after successive delays in the publication of the report.