Carlyle takes RBS to the Supreme Court

The landmark case of Derek Carlyle versus RBS will go all the way to the Supreme Court in November 2014. 

The developer whose landmark court victory over Royal Bank of Scotland was overturned on appeal by the bank last month has taken the case to the Supreme Court.

In the original judgment in 2010, Lord Glennie ruled that the bank had been wrong to withhold the final £700,000 development cost of a housing site at Gleneagles, after advancing Derek Carlyle £1.4 million to acquire land that was subject to a buyback clause unless houses were built.

Lord Glennie ruled that the bank had effectively created a “collateral warranty obligation”, encouraging Mr Carlyle to proceed with the land deal in June 2007.

The judge also reproached RBS for “lack of candour” in its evidence

Soon after Mr Carlyle won the original Court of Session case in 2010, the bank was instrumental in his sequestration for a minor debt, prompting Labour MP Jim Hood to accuse the bank in the Commons of sanctioning “a personal vendetta by bank personnel” against his constituent.

Full article here…

http://www.heraldscotland.com/business/company-news/carlyle-takes-rbs-case-to-supreme-court.22461402

Shredded: Inside RBS, The Bank That Broke Britain

RBS left exposed and shamed in Ian Frasers new book “Shredded”. 

Shredded explores how, under Fred Goodwin—a former partner at accountants Deloitte—RBS became a rogue institution with few qualms about “misselling” financial products to individual and business customers in pursuit of profit, a cavalier disregard for the law and a warped idea of its own financial skills and strength….

…Shredded outlines how, by terrorising subordinates, ingratiating himself to his superiors, gaming financial regulations and misleading politicians, Goodwin created a poisonous internal culture that ensured the bank was an accident waiting to happen.

Full article here…

http://www.ianfraser.org/shredded/

McEwan fighting a losing battle?

Even with Ross McEwan at the helm, RBS still face criticism from shareholders over the underhand tactics employed by the company’s GRG department.

Mr Henderson, who owned hotels at Portree and Montrose, and Mr Mitchell, who headed software group Torex Retail, have used past meetings to air their grievances, as shareholders do. But their complaints were that the bank plotted their financial destruction, anticipating the Tomlinson report which last year concluded, on evidence from over 200 businesses, that RBS’s Global Restructuring Group (GRG) habitually engineered financial distress in its SME borrowers in order to profit.

RBS refuted the report, as it has dismissed those complaints, and as it has pursued borrowers Derek Carlyle, David Booth, Ian McDonald and Len Wilcox, whose separate Court of Session actions alleging mistreatment by GRG have been reported by The Herald in the past year. Mr Carlyle’s case is now headed for the Supreme Court.

Sir George Mathewson, the bank’s former chairman who recruited Mr Goodwin, is said to think that neither Mr Hester nor his successor Ross McEwan “really know what is going on” inside the business, but that “the bank’s relationships with small corporates at the front end are now disastrous”. He says ‘them and us’ banking has dealt “a huge economic blow to the UK”.

Full report here…

http://www.heraldscotland.com/business/opinion/after-years-of-problems-can-mcewan-lead-rbs-out-of-its-war-bunker.24579864

RBS to close GRG department

Derek Sach head of RBS GRG department

GRG, which deals with companies facing collapse, has faced a barrage of criticism, notably from Lawrence Tomlinson, an adviser to the business secretary, Vince Cable.  He concluded in a report last November that the unit forced viable small businesses to the brink so that the bank could buy up their properties and make a profit.

Full report here…

http://www.theguardian.com/business/2014/aug/08/rbs-small-business-restructuring-head-leaves

RBS: Papering over the cracks

“The decision by RBS to dissolve its Global Restructuring Group, an arm of the bank that stands accused of destroying viable UK businesses for profit, will do little to repair the damage caused to the bank’s beleaguered reputation.” By Ian Fraser

RBS’ GRG department has been long believed to be intentionally driving businesses to the wall.  Now under thorough investigation RBS has taken the decision to close it down, for some though, the move is little more than a stunt.

….Professional advisers are sceptical that the closure will make much difference. Alison Loveday, senior partner of Manchester-based law firm Berg, which is representing scores of business people who claim their firms were destroyed by GRG’s actions, does not believe the closure of GRG will block the pipeline of civil litigation against RBS.

“It looks to me like this is a simple case of RBS jumping before they were pushed. None of this undoes the damage that’s been done to a great many businesses.”…

…Insolvency lawyer James Nicholls, former managing partner of Birmingham-based Nicholls & Co, said: “This is largely window dressing. If RBS was serious about cleaning up its act in recovery and restructuring, it would be bringing in a new broom from outside.”…

Read Ian Frasers full report here…

http://www.ianfraser.org/rbs-papering-over-the-cracks/