RBS facing action over restructuring unit this year
Herald Scotland, 22.08.16
A GROUP representing more than 140 small businesses has declared its intention to launch a £1 billion legal action against Royal Bank of Scotland over alleged mistreatment by its Global Restructuring Group before the end of the year.
The Herald revealed in June that RGL Management Limited was giving small businesses which believe they were pushed under after being moved into the GRG the opportunity to join a legal action against RBS.
At that stage RGL, led by chief executive James Hayward, said a fighting fund had been put in place and that a full legal team had been assembled to work on a success fee basis. RGL is now saying the action could be launched before the end of the year, having become frustrated with delays to the publication of the Financial Conduct Authority’s report into GRG. The report had been due last year.
RGL claims that even when the FCA report is published it may not lead to adequate compensation for companies involved. A spokeswoman for RGL said small business owners in Scotland are among its claimants. She said the average claim will be worth £6 million to £7m, taking the aggregate claim size to £1bn.
The development is a further setback to state-owned RBS. Earlier this month it booked a £2bn first-half loss after setting aside a further £1.3bn for litigation and conduct costs.
RBS has previously said it would defend the claims but declined to comment yesterday.