James Burton For The Daily Mail
Furious campaigners have accused Royal Bank of Scotland of trying to silence small business owners who claim it destroyed their livelihoods during the financial crisis.
The lender has sent out hundreds of letters telling firms which fell into the hands of its notorious Global Restructuring Group that they would not automatically get compensation from the £400million pot that has been set aside.
The bank has pledged to refund certain complex fees in full – but has told businesses that did not pay them that they are not entitled to any pay-out.
Compensation: It is the second time in a week that RBS has been accused of denying compensation to those who many believe should be entitled to make a claim
It is the second time in a week that RBS has been accused of denying compensation to those who many believe should be entitled to make a claim.
Earlier in the week the Mail revealed how RBS was set to deny compensation to 30,000 shareholders who hadn’t signed up to a court action over its 2008 fundraising drive. These shareholders will miss out on sharing in a pot worth £800million.
The latest revelation follows years of wrangling and reports into the GRG, which was set up as a crack turnaround unit to keep struggling firms afloat as they sought to pay off loans from RBS.
But a stream of entrepreneurs have since claimed they were instead deliberately pushed into administration.
They allege the bank then seized their assets to bolster its own ailing balance sheet.
RBS denies these claims but has admitted that it fell short of acceptable standards.
SNP MP George Kerevan, who is chairman of the All-Party Parliamentary Group on Fair Business Banking and a member of the Treasury Select Committee, said: ‘The letter sent by RBS to its customers who were forced into GRG is disingenuous and misleading.’
Cat MacLean of law firm MBM Commercial, which represents former GRG customers, said: ‘The amount of cash available under the compensation scheme doesn’t come anywhere close to actually being adequate for the number of clients affected. The bank is looking to exclude people wherever possible.’
It came as Treasury Committee chairman Andrew Tyrie issued a series of questions to RBS asking for more detail on the compensation scheme.
He also urged the Financial Conduct Authority watchdog to release a full report it commissioned into the GRG, as only a summary has so far been made public.
RBS said: ‘We have received a letter from the Chairman of the Treasury Committee and will be responding in detail in due course.’