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MPs accuse RBS boss of withholding information

MPs accuse RBS boss of withholding information

A committee of MPs has accused the chief executive of the Royal Bank of Scotland (RBS) of withholding information when he gave evidence during an investigation into the bank's treatment of small businesses.

In January Ross McEwan told the Treasury select committee he was unaware of any allegations of criminal activity against the bank, but it has since emerged police officers were investigating a former employee at RBS's Global Restructuring Group (GRG) division.

The committee had been investigating allegations that GRG had been artificially distressing otherwise viable businesses to benefit financially from their path into administration, receivership and liquidation.

Nicky Morgan, the committee's chairman, said it may now call Mr McEwan back to give more evidence and expect him to "tell the whole truth".

She said: "The committee is concerned by the pattern of defensiveness, and a failure to acknowledge mistakes, demonstrated by RBS throughout its handling of the GRG affair."

Mr McEwan said he would "entirely reject" the suggestion he misled the committee during his evidence session.

He added: "I would stress that the criminal allegations that RBS referred to Police Scotland in relation to this employee did not relate to the issues that the FCA has been considering as part of its four-year investigation into GRG's treatment of SME customers."

In 2014 the FCA announced a review into the conduct of GRG after Lawrence Tomlinson, then entrepreneur in residence at the Department for Business, Innovation and Skills, raised concerns about the fact it was artificially distressing small businesses.

The FCA has since highlighted that the services provided by GRG were unregulated, meaning its powers were "very limited" despite finding evidence of practices which were "clearly inconsistent" with ensuring customers were treated fairly.

It also highlighted the "significant tension" between GRG's objectives to turn companies around and be a major contributor to RBS's bottom line.

Mr McEwan said he was prepared to provide more detail to the committee once the police investigation had been concluded.