LEXLAW Solicitors & Barristers
RBS announces a New Complaints Process and Complex Fee Refunds for SMEs in their GRG division between 2008 to 2013. This process has serious flaws.
The FCA has stated it will not rush the delayed report on RBS’s Global Restructuring Group (GRG) due to the complexity and importance of the investigation. The report, highly awaited following allegations of misconduct by GRG, aims to thoroughly assess RBS’s treatment of SMEs and the bank’s recovery practices.
SMEs who claim they were mistreated by Royal Bank of Scotland’s turnaround division, GRG, await to see if the City regulator will set up an FCA-agreed GRG compensation scheme.
Our litigation against Barclays involved a claim for approximately £4 million relates to the mis-selling of derivatives, specifically interest rate swaps (IRHPs). The case addressed allegations that Barclays sold complex, high-risk products to clients without proper disclosure or adherence to regulatory requirements.
RBS has agreed to a £1 million settlement with a businesswoman who accused the bank of mis-selling complex derivatives. The case highlights banks selling unsuitable financial products to businesses. RBS initially denied wrongdoing but eventually agreed to the settlement, which includes repayment of derivative payments, break costs, and suspended payments. The businesswoman’s business was negatively impacted by the mis-sold derivatives, and the case exposes flaws in the Financial Conduct Authority’s IRHP review scheme.
The Times reports that Wenta, a company that supports new businesses, is suing RBS and NatWest for mis-selling a complex financial product. The banks sat on Wenta’s board and encouraged the deal, despite it being a disastrous one that cost the company over £500,000.
Lexlaw, Wenta’s lawyers claim the banks misled the company about the risks involved and have been slow to resolve the dispute. While several other banks have settled similar cases, RBS and NatWest have resisted, forcing Wenta to take legal action. The case is currently undergoing mediation, and a settlement may be reached soon.
The FCA is set to recommend a compensation scheme for businesses harmed by RBS’s Global Restructuring Group (GRG), according to an upcoming report. While the GRG Review may be quicker than litigation, it is criticised for being unfair and limiting compensation. Victims are advised to consider parallel litigation, which is designed to ensure a fair outcome. GRG, a troubled business support unit within RBS, controlled assets of 16,000 SMEs before being disbanded in 2014 following misfeasance allegations.
Westgate Healthcare settled a legal dispute with RBS for £10m, involving alleged misrepresentation and breach of contract regarding an interest rate swap. Deemed too sophisticated for FCA’s compensation scheme, Westgate’s claim, initiated in April 2014, led to a settlement with RBS, who imposed confidentiality and accepted no liability.
The High Court ruled that fraud allegations against RBS concerning LIBOR manipulation in a derivatives mis-selling claim were “properly arguable,” affecting SMEs sold IRHPs by major banks. LIBOR, a crucial interest rate benchmark, had been rigged by banks including RBS, resulting in hefty fines. RBS admitted misconduct in its LIBOR submissions. Property Alliance Group’s (PAG) case against RBS may set a precedent for extending time limits on claims, emphasizing the importance of seeking legal advice on mis-selling claims affected by LIBOR fraud.
The High Court in Suremime Ltd v Barclays ruled it is arguable that banks owe a duty of care to SMEs to conduct the FCA IRHP Review fairly, as agreed with the FCA. Suremime challenged Barclays’ limited redress offer, arguing the bank breached its duty by not properly following the IRHP Review agreements from 2012 and 2013. The court granted permission to add claims that Barclays owed and breached this duty, enabling affected SMEs to seek legal remedies beyond flawed review outcomes. This decision supports SME rights in swaps mis-selling disputes and helps overcome limitation barriers.