BUSINESS Secretary Vince Cable has defended a report written by a Yorkshire-based Government adviser which contains scathing criticism of the way Royal Bank of Scotland treats struggling small businesses.
In a question to Mr Cable in the Commons, Shadow Business Secretary Chuka Umunna referred to a report compiled by Leeds-based businessman Lawrence Tomlinson, “which accuses RBS of artificially distressing successful businesses in order to seize assets and make a profit. That is a very serious allegation about a bank that we, of course, own.”
In his report, Mr Tomlinson, states that banks must ensure that robust processes are in place to avoid conflicts of interest. Mr Umunna said: “It has transpired, however, that he is an RBS customer, and that he has a complaint about the bank pending. Was the Secretary of State aware of that before he allowed the report to be published, and does it not call the report’s independence into question? It is not independent, is it?”
Mr Cable replied: “I was well aware that Mr Tomlinson was an RBS customer....Crucially, his accusations are echoed in the report published by Sir Andrew Large, who was appointed by RBS. There are serious problems in the banking system, and in RBS in particular. Those problems need to be investigated, and I think that Mr Tomlinson has performed a useful service in making them public.”
Mr Tomlinson said: “I have never made a secret of the fact that I am an RBS customer, The complaint I have with RBS is historical and relates to two individuals in the bank towards one of our subsidiary businesses.
“The LNT Group currently has a facility with RBS which we are happy with, and in fact we have an offer for finance from RBS for our next refinance too.
“I have never been in the Global Restructuring Group, nor have any of my businesses. I had not even heard of GRG. This is simply the issue I received the most and strongest evidence in relation to.”
Responding to the Tomlinson report, RBS said last month: “GRG successfully turns around most of the businesses it works with, but in all cases is working with customers at a time of significant stress in their lives.”