Business Secretary Vince Cable has urged the Scottish legal authorities for a swift decision on whether to prosecute Royal Bank of Scotland’s (RBS) former directors. We answer five questions on Cable’s request.
Why is Vince Cable making this plea now?
Cable said he sent the letter to the Scottish authorities asking for the matter to be dealt with as soon as possible because he wanted to maintain public confidence, report the BBC.
What did Cable say exactly?
According to the BBC, Cable said to the Advocate General for Scotland, Lord Wallace, a fellow Liberal Democrat, that he was looking for an update on the situation but was not trying to influence it in anyway. He said
“There is, as you will know, considerable public concern about the actions of the directors of RBS prior to its insolvency.
“Following the release of the FSA’s report into the failure of RBS I sought legal advice on what if any enforcement action was appropriate and was advised that the Crown Office and Procurator Fiscal Service (COPFS) should consider a possible prosecution.
“Given that this matter was referred to them in January 2012, I am very keen for a decision to be reached as quickly as possible in order to maintain public confidence in the efficiency of the decision-making process.”
What do the prosecution charges relate to?
In 2011, a report by banking regulator the Financial Services Authority (FSA) said RBS was nearly foiled in 2008 – when it required a £45.5bn taxpayer-funded bailout – because of ‘multiple poor decisions’ and a £50bn ‘gamble’ on buying Dutch bank ABN Amro.
It also stated that RBS Chief Executive Fred Goodwin’s management style was highlighted as a potential risk as early as 2003.
A short while afterwards, the Crown Office in Scotland said an investigation had been under way for some time because of “the degree of public concern about recently reported issues in the banking sector”.
Is this the only legal action against those involved in bringing RBS to its knees?
No. Earlier this month more than 12,000 private shareholders and 100 institutional investors raised a class action against the bank relating to a £12bn rights issue by RBS in 2008 after its acquisition of ABN Amro.
Who are those involved in this latest legal action?
Goodwin is among those named in the action, as well as ex-chairman Sir Tom McKillop and senior figures Johnny Cameron and Guy Whittaker.
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