LEXLAW Solicitors & Barristers
We have today submitted evidence on the ineffectiveness of existing arrangements for dispute arbitration and settlement between SMEs and banks to the Treasury Committee‘s SME Finance Inquiry. Re:…
RBS says it will expand its redress scheme to include appeals with independent third- party oversight for consequential losses suffered due to misconduct by its Global Restructuring Group (GRG).
The door has been opened by the Court of Appeal in PAG v RBS [2018] for misrepresentation claims to be brought by a counter-party to a derivative which…
The Court of Appeal (Sir Terence Etherton MR, Longmore LJ and Newey LJ) handed down judgment in the highly anticipated appeal from Asplin J’s decision in Property Alliance…
The Property Alliance Group (PAG) appeal against RBS concerning interest rate swaps mis-selling, LIBOR manipulation, and GRG treatment was dismissed by the Court of Appeal in 2018. While PAG lost on the facts, the Court clarified key legal points: banks must exercise valuation rights for legitimate commercial purposes, not maliciously, and duties owed vary by case context. The judgment impacts many pending mis-selling claims, offering guidance on banks’ responsibilities and contractual rights. PAG’s LIBOR manipulation claim failed due to lack of evidence on sterling LIBOR but remains significant for other currencies.
The FCA regulates authorised firms under the Financial Services and Markets Act (FSMA) 2000, overseeing conduct and prudential standards. It authorises firms, supervises compliance, investigates breaches, and enforces rules via fines, bans, and public censure. The FCA’s remit focuses on “regulated activities,” but it also monitors firms’ overall behaviour, including some unregulated actions linked to regulated firms. It holds senior managers accountable under the Senior Managers and Certification Regime (SMCR). The FCA aims to protect consumers, uphold market integrity, and promote competition, balancing its powers with statutory limits set by Parliament and Government.
UK Parliament unanimously condemned RBS’s Global Restructuring Group (GRG) for its systemic mistreatment of SMEs, describing it as a parasitic unit engaged in asset stripping and aggressive litigation tactics. MPs highlighted GRG’s role in artificially distressing viable businesses, undervaluing assets, and employing harsh recovery strategies during 2008-2013, leading to widespread financial harm. The FCA’s delayed and redacted report faced heavy criticism, with calls for transparent accountability, a Financial Services Tribunal, whistleblower protections, and full release of investigations.
The leaked 2009 internal memo from RBS’s Global Restructuring Group (GRG), titled “Just Hit Budget!”, reveals aggressive tactics aimed at extracting maximum profit from struggling SME customers. The memo outlines a systematic approach to pressure businesses, including leveraging fees, forcing deal signings, and deliberately letting customers fail – referred to chillingly as “let customers hang themselves.” This memo exemplifies the toxic culture within GRG that led to severe financial distress for many SMEs.
In 2014, Promontory Financial Group and Mazars were appointed by the FCA to prepare an independent skilled persons report into RBS Global Restructuring Group’s conduct, which was produced…
The Court of Appeal dismissed the Green & Rowley appeal against RBS regarding swaps mis-selling. The appeal failed mainly because the claimants abandoned their section 150 FSMA claim, likely due to mistaken limitation concerns. The court found no common law advisory duty beyond regulatory compliance in this case. The decision highlights the critical importance of correctly calculating limitation periods.