From: - fca.org.uk Sent: 05 March 2015 15:29 To: BE Cc: Subject: RE: Urgent: response to the BIS Select Committee -, as just discussed, please find the response to your email of 2? February. A hard copy version is on its way to you too. [Letter attached Annex If you have any additional questions or comments then please let me know. Kind regards Specialist Supervision Supervision Division (Mm Financial Conduct Authority 25 The North Colonnade Canary Wharf London E14 5H5 Tel: From: (BE) Sent: 2? Februa 2015 17:2L?l Cc: (BE) Subject: Urgent: response to the BIS Select Committee Thank you for the update an the S166 review just now. As promised, here is the relevant extract from the B18 COM hearing last Tuesday with the key bits underlined. Could I ask you please for a formal CA response to the query about where you are with the investigation of the allegations of bank mistreatment of businesses in ?nancial dif?culty. I think this should be in the form of a letter to Vince Cable that he can then simply copy to the BISCOM chairman so drafted on the assumption that it will be made available publicly. I guess it would need to include: Who is carrying out the review. Something about the review process, including the sampling methodology. An estimate of when the ?ndings will be published. What the FCA has done to satisfy itself that banks other than RBS have been fair in the way they treat business in difficulties. (The chairman refers to clearing banks in the plural). If I remember correctly, there was the public letter to each of the banks asking them to consider whether they recognised any of the bad practice identi?ed in the Tomlinson and Large reports. Their responses were then to be followed up at the regular bilateral FCA monitoring meetings held with the banks. Could we have a response by Thursday morning please. Does this sound doable? Kind regards BIS Business Finance and Tax Team BISCOM Chair: Can I come on to the Tomlinson Report, Minister? I know you have had evidence put to you by representatives of failed businesses. Indeed, I had the same evidence put to me by some of the same businesses. The Tomlinson Report did suggest that some of the major clearing banks had been deliberately engineering defaults in companies in order to make money from fees or devalued assets. Certainly I know that you have been sympathetic to some companies that appear to have suffered this. What evidence have you got that these practices have changed following the Tomlinson investigation into this? Vince Cable: Let me go back a bit. I would acknowledge and praise the work that Mr Tomlinson did. He was our ?rst entrepreneur in residence?-the ?rst of two?and I encouraged him to pursue the line of inquiry that he did. He produced this report, which we gave to the Financial Conduct Authority. 1 am not sure that they have yet completed their work. In some cases there was a discussion about whether this merited intervention by the Serious Fraud Of?ce. I do not know where that got to. Whenever I have met the leading banks,_1 have challenged them to assure me that these practices do not continue. I am meeting Mr McEwan later today, and I know that RBS has closed down the unit that was at the centre of a lot of these allegations; certainly that is the case in Lloyds too. The FCA is the body that is following this on a constant basis. Chair: 1 know that the representatives of some of these businesses have approached the FCA, and the feeling they are getting?and I think it is probably correct?is that they are being passed from pillar to post. They have very genuine grievances that reflect practices that may in some cases have been illegal but nothing is being done about it and they have no means of personal redress. When you think of past scandals?the PPI scandal and so on and so forth?something has been put in place to compensate the individuals concerned for the consequences of these particular working practices by the banks. Here you have got businesses that may have had employees where individuals have been made bankrupt purely and simply, on the face of it, because of the banks deliberately foreclosing on them. Could the Department make representations to have some sort of investigatory process carried out in order that companies and individuals who have been affected like this can have them investigated and a decision made= and at least feel there has been some sort of redress from the various Government institutions that are supposed to support business? Vince Cable: I will certainly ask the Financial Conduct Authority where they currently are with those investigations. They do relate to events ?ve or six years ago? sometimes longer. Most of them relate to activities in the commercial property market, where conditions have now changed, but we do need to ?nd out what happened to those investigations. 1 know some of the banks denied them. I will ask the regulator where they currently stand. Chair: Thank you. I would welcome a copy of the responses that you get on that. From: (BE) Sent: 01 Au ust 2014 15:02 To: imm- Subject: FCA 5166 investigation Thanks for the update earlier. Does this quick resume do justice to what you said? I spoke to the FCA about progress with the GRG review ahead of the Lawrence Tomlinson and Ross McEwan meetings in early September. The latest news is as follows: 0 Initial plans to publish the outcome by the end of September are not going to be met. Publication is not now expected until March 2015. [It is possible that there may be interim conclusions in the Autumn, but this is unlikely. The delay is attributed to the time it is taking for the investigators to [deleted because it relates to the F01 in uestigation]. I [Deleted because it relates to the in vestigotion] Dr Cable is bound to want to know whether it really needs to take that long and whether there?s anything he can press FCA or, more particularly, R35 to accelerate somehow. Are you satisfied that R33 is putting enough resource into this? an) u'rr"! - - - um- From: fcaergek Sent: 30 A ril 2014 14:22 To: (BE) Cc: Subject: RE: "skilled persons" report on Tomlinson?s RBS allegations Dear - Thank you for your email and your interest in our work. The FCA expects to publish the outcomes from the RBS skilled person's review in Q3 2014. Whilst commercial lending is not a regulated activity under FSMA, if the findings reveal issues which come within the remit, the FCA will consider further regulatory measures. For more information please refer to our recent announcement at We understand that you are interested in meeting us to discuss the progress of our work on the RBS section 166. We have some time on Wednesday May in the afternoon if this suits you. Would you be able to come to the offices in Canary Wharf? However, just to set your expectations, we will not be able to provide you with any more information about our ongoing work than is already available on our website. Thank you and kind regards ?Event Supervision Department (WIEI Financial Conduct Authority 25 The North Colonnade Canary Wharf London E14 5H5 .org.uk From: (BE) Sent: 24 A ril 2014 10:43 To: @fca.org.uk Subject: "skilled persons? report on Tomlinson's RBS allegations Hil Will the ?skilled persons" report, when it is finalised, be published? It not published, how will the findings be communicated, and how openly? What is the legal position on this? Is the position that reports cannot be published, or is their discretion for the FCA to publish it it is in the public interest? How are you likely to treat this particular case? I ask because of the publicity that has surrounded the publication of Clifford Chance's review. It might be good to have a catch up generally on where things have got to. Rags Business Finance and Tax Team Department for Business innovation and Skillet From: ?@bis.gsi.gov.uk Sent: 21 Janua 2014 10:05 To: d?fca.org.uk Subject: Appointment of the skilled persons Dear - Many thanks for the various messages last week, and i saw that the appointment was announced on Friday. Is there any news yet about the practical arrangements for sending correspondence etc to the review team? We are continuing to receive letters and mails (and will no doubt get another batch following tonight's File on 4 programme). Our standard line for correspondence is set out in the attached. I guess at some point, Promontory andi'or Mazars will setup an mail address and other contact details for the review. It would be useful to have this when it is available. see that Sir Andrew Large is appearing before the Treasury Select Committee on Wednesday, and Lawrence Tomlinson on the 29th next week. Kind regards -. .-.. .. ..??nmhuumq +1 "1 From: Sent: 16 Janua 2014 13:09 To: Subject: EMBARGOED: FCA statement re RBS enquiry We?re awaiting final sign-off on the precise form of this statement with a view to this being issued today, but it will look close to this: ?Update on independent review of Royai Bank of Scotiand?s treatment of business customers in financiai difficuity The Financiai Conduct Authority (FCA) has appointed Promontory Financialr Group and Mazars to conduct an independent persons report under section 166 of the Financiai Services and Markets Act (FSMA) 2000. The report examine ROyai Bank of Scotiand?s (RES) treatment of business customers in financiai dih?icuity and consider aiiegations of poor practice set out in the report by Dr Lawrence Tomiinson and referenced in Sir Andrew targets report. The first stage of the investigation inciude a review of R59 treatment of a sampie of customers referred to its Giobai Restructuring Group. This inciude some cases where customers have aiready raised concerns with Dr ?Tomiinson, The Department of Business, innovation and and the FCA. The review aiso consider whether any poor ractices identified are widespread and systematic. If this is the case, the second stage 1" the review identify the root cause of these issues and make recommendations to a dress any shortcomings identified. The FCA expects to publish the findings from th . review by summer 2014. Whiist commerciai iending is not a reguiated activity under FSMA, if the findings reveai issues which come within the remit, the FCA consider further reguiatory measures. Kind regards Division leHimTM-m" Financial Conduct Authority 25 The North Colonnade flanariir Wharf London E14 5H5 Tel? From: Sent: 23 October 2013 10:58 Cc: Subject: RE: TRIM: Restricted: Lawrence Tomlinson's allegations about behaviour of the banks' business restructuring groups Part 3 Part 3 File: (BE) Sent: 23 October 2013 10:52 To: ca.org.ul