Onside Issue 4 - 35

Dan Fallows
daniel.fallows@senecabanking.co.uk
01204 322 805
Dan Fallows is the founder of both Gorilla
Accounting and Seneca Banking. He qualified as a
corporate lawyer.

After constant pressure by the Treasury Select Committee
and various campaigners, the FCA has finally agreed to
formally review the compensation scheme.
Treasury Select Committee Chairman Andrew Tyrie MP
called for a full review of the scheme back in March, but
was knocked back by the FCA. He said: "It is welcome that
the FCA now recognises the merit of conducting a review A former RBS employee turned GRG whistleblower said:
of how the redress has been operating. It should get on with "We were pretty much told at that point in time that the
this. Restoration of confidence in the scheme is essential."
ethos, the mission statement, of GRG had changed. From
that point on we wouldn't be just looking to save businesses.
But possibly the most serious and damaging effect of We would be looking to recover all the monies back that we
potential misconduct by the banks has been the use of had lost as much as possible. Overnight that took effect."
special restructuring teams who have ended up making a
bad situation even worse for companies.
Since these allegations came to light the Financial Conduct
Authority (FCA) promised a shake up of RBS and its GRG
Back in 2013 it came to light that RBS may have been division. There has been no official statement as of yet,
mis-treating small businesses in an attempt to help however it is believed that RBS are considering a redress
save themselves during the credit crisis. The bank was scheme for small businesses affected by the GRG scandal.
accused of 'destroying a number of businesses that didn't
need destroying'. Accusers claimed that RBS' Global The FCA are yet to fully complete their investigation,
Restructuring Group division (GRG), which was set up however they have promised to complete their review before
in the 90's to help troubled businesses, used 'immoral and the end of 2015. Once the FCA publish the report on their
survivalist tactics' such as deliberately charging high fees findings, a decision on a compensation scheme is expected.
to push businesses to the brink, intercepting payments
and transferring these into RBS owned accounts, and also One ex-property developer and GRG victim has said that
stripping firms of any assets they owned.
this will not be enough. "It's not just about the money" he
said. "For what they have put me and my family through
RBS has taken heavy criticism of its actions in relation to its I want an apology and an annulment to my bankruptcy. I
GRG division. Lawrence Tomlinson, the author of a report would rather expose them for the diabolical liberty they
commissioned by the government said: "The balance of have taken."
power has tipped too far in favour of the banks. Given their
past reckless behaviour and the size and domination of the For Seneca's Dan Fallows, getting advice early will prove to
two biggest banks, this leaves businesses in an extremely be essential, given past performance: "If the compensation
vulnerable position. Without better protection in both the scheme was to be rolled out, RBS could compensate the
short and the long term, businesses will continue to fail at affected businesses without actually admitting liability.
the hands of the institution that should be supporting them." Paying businesses off could avoid costly litigation, which
could involve class action for many businesses."

What is a swap?
Interest Rate Hedging Products (such as Swaps, Caps, Collars and Tailored Business Loans)
were meant to be a form of protection for smaller businesses against rising interest rates.
However, as interest rates fell, many companies faced huge charges and interest penalties.
Who can help?
Seneca Banking Consultants is an experienced and specialist advisor to individuals, partnerships,
SMEs and large corporations on claims for mis-sold Interest Rate Hedging Products.

Table of Contents for the Digital Edition of Onside Issue 4

Contents
Onside Issue 4 - Cover1
Onside Issue 4 - Cover2
Onside Issue 4 - Contents
Onside Issue 4 - 4
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Onside Issue 4 - Cover3
Onside Issue 4 - Cover4
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