SMALL businesses have been forced into a restructuring unit by RBS, where their assets were stripped and sold on for profit, a government advisor claimed yesterday, calling the lender a “vampire.”
The bank denied the claims, arguing there is no evidence of the allegations made by Lawrence Tomlinson to MPs on the Treasury Select Committee.
Tomlinson is the Department for Business, Innovation and Skills’ entrepreneur in residence and first made the claims RBS had been harming customers in a report published in November 2013.
The businessman heard from 200 firms before his report and more than 1,000 since, and he believes a large proportion of those have suffered in RBS’s unit called the Global Restructuring Group (GRG).
“I have not come across businesses being turned around in the GRG. Whistleblowers from the bank say they cannot remember the last time a business came back out of the GRG,” Tomlinson said.
“I liken them to a vampire business – they are kept in the GRG and as soon as they get any cash to invest and grow, it is taken out of them.”
RBS denied many of Tomlinson’s claims and are investigating others.
“The vast majority of businesses that have gone through GRG have had a positive outcome, either returned to the main bank, rebanked or paid their debt back with only a minority facing insolvency,” said an RBS spokesperson.
“It is important to note that the most serious allegation that has been made is that RBS conducted a ‘systematic’ effort to profit on the back of our customers when they were in financial distress. We do not believe that this is the case and no evidence has been provided for that allegation to the bank.”
Law firm Clifford Chance has been appointed to investigate the claims that the GRG forced firms out of business.
The Financial Conduct Authority is also looking into a range of Tomlinson’s allegations.