MPs have threatened to force the Financial Conduct Authority to disclose a report into the treatment of Royal Bank of Scotland’s business customers.
The Treasury Select Committee has threatened to appoint legal adviser to verify the Financial Conduct Authority’s summary report reflects the actual report’s findings.
Last month Nicky Morgan, the committee’s chairman, wrote to Andrew Bailey, chief executive of FCA, to urge the watchdog to publish the skilled persons’ report into the treatment of customers in RBS’ Global Restructuring Group (GRG).
Following the FCA’s refusal to publish, Mrs Morgan has now written to Mr Bailey again to propose that the committee appoints a legal adviser – Andrew Green QC – to compare the FCA’s forthcoming summary with the underlying report.
Mr Green has previous with the FCA since he was the author of the report into the failings of the Financial Services Authority around collapsed lender HBOS.
Mrs Morgan said: “The committee wants the maximum possible transparency to be brought to this long-standing issue.
“With that in mind, it has proposed an arrangement under which it appoints an independent legal adviser to provide assurances that the FCA’s ‘summary’ closely reflects the underlying GRG report.
“If the FCA declines this proposal, or if the legal adviser cannot provide the committee with the assurances it needs, the committee may use its formal powers to require the FCA to produce the report.
“In any case, the long-awaited summary should be published as soon as possible. The committee’s review is not a reason for further delays.”
Mr Bailey had previously written to Mrs Morgan saying it is not in the public’s best interest to publish the full report but reiterated the FCA’s “intention to publish a detailed summary”.
GRG, which was a division of RBS, was a business support unit for troubled firms. More than 12,000 companies were transferred into GRG between 2007 and 2012.
Problems were first noted in November 2013, when Lawrence Tomlinson, then entrepreneur in residence at the Department for Business, Innovation and Skills, made a number of allegations against RBS.
It claimed the bank artificially distresses an otherwise viable business and through their actions puts them on a journey towards administration, receivership and liquidation.
It also added that once transferred into the business support division of the bank, the business was not supported in a manner consistent with good turnaround practice and that the insolvency process lacked fairness and accountability.
The following year in January 2014 the FCA announced a review of the conduct of GRG.
The FCA expected the report to be published at the end of 2015 but this was pushed back and it was only in November 2016 when the regulator issued a statement.
This gave a summary of the findings and set out RBS’ new complaints review process, as well as its automatic refund for complex fees charged to SME customers in GRG.