Whistleblowers at centre of HBOS scandal call on Lloyds to come clean after allegations emerge suggesting scam was covered up for nine years

 
Hayley Kirton
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Two former HBOS employees were among six people jailed earlier this year (Source: Getty)

The couple who blew the whistle on a fraud linked to two former HBOS employees have called on Lloyds Banking Group to spill all, after allegations emerged suggesting the scam was covered up for almost a decade.

Earlier this year, Lynden Scourfield, once head of the HBOS department responsible for businesses in financial difficulty, and Mark Dobson were among six people handed prison sentences for their roles in a £1bn fraud which drove troubled firms into the ground for the wrongdoers' personal gain.

Lloyds, which bought HBOS at the height of the financial crisis, previously said it was unable to discuss the scandal while the criminal case was ongoing. However, since its conclusion, the bank has vowed to review the cases of the customers caught up in the scandal in light of the evidence unearthed at trial.

Read more: Lloyds has just hired this professor to oversee its HBOS review

The Sunday Times reported today it had seen documents suggesting the scam was covered up for nine years.

"These revelations show that first HBOS, then Lloyds, exacerbated the distress of victims of this fraud in nearly a decade of deceit," said Nikki Turner, who, alongside her husband Paul, helped to expose the fraud. "Lloyds needs to reveal what its board knew, and when, and what action it is taking to put its house in order and right the wrongs suffered by hundreds of people, who lost their businesses and livelihoods in this scandal.

"Perpetrators of the fraud were punished but nothing has been done about the perpetrators of the cover up."

Read more: Lloyds vows to review cases of customers caught up in HBOS fraud

Lloyds said it had passed the document to the police and regulators back in 2014, even though the bank felt it "contains many unsubstantiated allegations about individuals, auditors, regulators, as well as HBOS, the majority of which are made without any supporting evidence".

"We are now taking action at pace, to review the cases of all those who may have been affected and, where appropriate, to ensure they are fairly recompensed," a spokesperson for the bank added.

During the trial at Southwark Crown Court, it was said Scourfield was bribed with cash, exotic holidays and sex workers to push struggling businesses to engage with a particular turnaround business. He then advanced them sums of money so large they could never realistically repay them, allowing the turnaround firm to charge hefty fees for consultancy services.

Read more: MPs call on Lloyds to pay up following HBOS fraud trial

Scourfield, who pleaded guilty before the start of the trial, was sentenced to 11 years and three months. Dobson was sentenced to four and a half years.

The Turners, who were caught up in the fraud via their music publishing business, say they first alerted HBOS to the scam in 2007.

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