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Shadow Minister calls for judge-led inquiry into RBS business lending scandal

Shadow Business Minister Bill Esterson has called on the Prime Minister Theresa May to order a judge-led inquiry into the scandal of the state-owned Royal Bank of Scotland "asset-stripping" businesses and driving many into the ground.

The Treasury Select Committee ordered the Financial Conduct Authority (FCA) to release a report on the scandal, where fees and charges were levied and assets were sold at knock-down prices often with disastrous consequences for the businesses involved.

The FCA refused to release the report, which sources say points to growing evidence to suggest that thousands of people had their livelihoods ruined, lost their homes, saw their families torn apart and in dozens of cases, took their own lives.

Mr Esterson, MP for Sefton Central, wrote:

"Dear Prime Minister,

"The chair of the Treasury Select Committee has asked RBS to allow the Financial Conduct Authority (FCA) to release its report into RBS Global Restructuring Group (GRG).

"Tens of thousands of previously successful businesses were moved into GRG and its successor from 2008 onwards by RBS. Leaks of the FCA report suggest that only 10% of firms made it out of GRG intact, yet evidence exists that 75% of businesses were solvent before being allocated to GRG.

"The evidence about the way GRG operated suggests that fees and charges were levied and that assets were sold at knock-down prices often with disastrous consequences for the businesses involved.

"Significant evidence exists of a wholesale, systematic asset stripping of businesses by the bank.

"There is growing evidence to suggest that thousands of people had their livelihoods ruined, lost their homes, saw their families torn apart and in dozens of cases, took their own lives.

"That evidence suggests that a scandal which saw £90 billion taken from business owners and that practices that are very damaging to business clients of RBS continue to this day, even after the closure of GRG.

"The reputation of banks in this country among many business owners is at a low level. It is in the national interest for that reputation to be improved.

"I am therefore calling on you to intervene, to ensure that the truth about what happened is confirmed; that those who have the right to compensation receive it in a timely manner and to an appropriate level; that  justice is not delayed any longer than is necessary.

"Will you therefore ensure that the FCA report is made publicly available and will you also consider setting up a judge-led enquiry.

"Without the transparency that will come from the release of the FCA report; without a judge-led enquiry into what happened within RBS/GRG and possibly elsewhere, it is hard to see how confidence can be restored in our banking system. And without that confidence, our banks are always going to be restricted in their ability to play the role they should in providing crucial financial support for our businesses, especially our smaller businesses."

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