RBS boss Ross McEwan ‘withheld information’ from parliament, claims Treasury Committee chair Nicky Morgan
The chief executive of Royal Bank of Scotland has been accused of "withholding information" when giving evidence to parliament.
Ross McEwan told the Treasury Select Committee, including Tory chair Nicky Morgan, back in January that he was not aware of any allegations of criminal activity within the bank's notorious and now-defunct Global Restructuring Group (GRG).
However, it emerged this summer that police were investigating allegations that an RBS manager demanded tens of thousands of pounds from business customers in return for overlooking their debts. The Times reported that McEwan was aware of the alleged bribery when he appeared before the committee.
Morgan subsequently wrote to the bank CEO demanding answers, and this morning has blasted his response which "implies that this [omission of information] was not inadvertent, but because he considered that the criminal allegations and police investigation in question were not related to the subject matter of the committee’s session".
Morgan added: “The committee is unconvinced by that explanation. It expects clarity and openness from witnesses, and Mr McEwan’s evidence fell short of that standard.
"More generally, the committee is concerned by the pattern of defensiveness, and a failure to acknowledge mistakes, demonstrated by RBS throughout its handling of the GRG affair. Mr McEwan’s letter to me is an example of this, and it casts doubt on his assurances that RBS’ culture has changed fundamentally since he took up his position five years ago.
“If the committee decides to ask Mr McEwan to provide further oral evidence, it will expect him to tell the whole truth, not an edited version to suit him.”
McEwan insists he replied to the committee "in good faith".
In a statement responding to Morgan's comments this morning, McEwan added: "In this particular case, the allegations that we referred to Police Scotland did not relate to any of the issues that the FCA has been considering as part of its four-year investigation into GRG’s treatment of SME customers during the period 2008-2013. I am confident that when the legal process has run its course, this will be seen to be a unique case.
"There continue to be clear constraints as to what can be disclosed as we would not want to prejudice an ongoing police investigation.”
In February this year Morgan's committee published a full report into RBS's historic treatment of small business customers following a standoff with the Financial Conduct Authority, which had originally commissioned the study. The FCA insisted it contained confidential information.
The report found no evidence of criminal misconduct in its review of GRG’s treatment of SME customers, but revealed a culture of profit-chasing at the expense of business customers.
It revealed a memo urging staff to let customers "hang themselves" and referring to certain clients as "basketcases: time consuming but remunerative". The memo was described by the report as "indicative" of the attitude within the unit at that time.
However, at the end of July the FCA said it was unable to take any disciplinary action against RBS over the GRG scandal – an outcome Morgan described as "disappointing and bewildering" at the time.