RBS boss accused of withholding information from MPs

House Of Commons

The Royal Bank of Scotland chief executive has been accused of withholding information from MPs investigating the bank’s mistreatment of small businesses.

In a frosty exchange with Nicky Morgan, the Treasury committee chair, Ross McEwan rejected the suggestion that he had misled MPs at an evidence session intoheavily criticised practices at the lender’s Global Restructuring Group.

Hostilities could yet be resumed at a new evidence session, after Morgan said the committee was considering recalling McEwan to “tell the whole truth”.

The dispute arose after McEwan told the committee in January that he was unaware of any suspected criminal activity at the bank, in response to a question by Alister Jack MP.

It later emerged that an employee of the bank’s controversial GRG unit was the subject of a criminal investigation by Police Scotland.

In a letter last month to Morgan, a Conservative MP, McEwan explained the omission by saying that the case “did not relate” to the subject of the hearing, a four-year investigationby the Financial Conduct Authority into the activity of GRG.

McEwan said the bank “would entirely reject the suggestion that the committee may have been in any way misled by the evidence that I gave”.

Ross McEwan’s letter.

But, in a response to McEwan sent this week, Morgan described his explanation as “unconvincing”.

“The committee expects clarity and openness from the witnesses that appear before it,” she wrote.

“It considers that your response to Mr Jack’s question fell short of that standard, since you withheld information of relevance and interest.”

She also criticised the tone of the letter, in particular McEwan’s rejection of the notion that he misled the committee.

Morgan said 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.”

Nicky Morgan’s letter.

In a statement accompanying the letter, the committee said it might ask McEwan to give further testimony.

“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.”

In a statement, McEwan said he was “disappointed” by her comments.

“I replied to the committee’s questions in good faith and clarified my position in writing,” he said.

McEwan and senior figures at RBS are understood to be dismayed by Morgan’s perceived grandstanding in response to what they believe to be a reasonable explanation.

The bank is expected to reiterate its defence that the criminal inquiry by Police Scotland had nothing to do with the FCA’s investigation into GRG and fell outside the four-year period covered by it.

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Earlier this year, the committee published the FCA’s report into GRG in full after the watchdog chose to release only a redacted version.

The committee described the details uncovered by the FCA as “disgraceful”, pointing to allegations that GRG caused small firms “material financial distress” while protecting its own profits.

Prior to the release of the full report, RBS was accused by Labour MP Clive Lewis of misleading MPs about the extent of GRG’s mistreatment of small businesses.

Powered by Guardian.co.ukThis article was written by Rob Davies, for The Guardian on Friday 14th September 2018 06.01 Europe/London

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