Time to end the auditing merry-go-round

The Guardian, 30.01.18

Ross McEwan, chief executive of Royal Bank of Scotland, looks ridiculous. For roughly two years, he has resisted publication of the regulator’s so-called “skilled person’s report” into the bank’s bad treatment of small and medium-sized business customers. Now RBS has performed a stunning U-turn.


The bank “no longer thinks it is useful to have an argument” with the Financial Conduct Authority, explained chairman Sir Howard Davies. The bank is prepared to see the document published, even though it disagrees with some of its findings.


Why the change of heart? Presumably because RBS has looked evasive every time MPs have asked awkward questions. McEwan himself was obliged to admit on Tuesday that a claim he made in 2014 was not true. He had said the “vast majority” of businesses that entered RBS’ Global Restructuring Group had been turned around, but his definition of a turnaround included insolvency.


Meanwhile, Promontory – the firm that wrote the report for FCA – has turned the screw. Its boss, Tony Boorman, painted RBS as obstructive and defensive. McEwan, in resisting publication, found himself defending the indefensible.


The version of the report that appears at the end of this process will probably be heavily redacted or edited – the FCA still has to respect the legal rights of individuals named in the report. But McEwan’s previous intransigence is bizarre. He didn’t have to play hard. He made a very bad call.


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