Independent Banking Advisory Service
Established in 1992
Banking News & UK Comment 2017
(use the 'headline link' to read full articles at their source)
HBOS fraud ‘covered up for nine years’ - One of Britain’s largest frauds, which destroyed hundreds of small businesses that banked with Halifax Bank of Scotland (HBOS), was covered up for nine years, according to an internal report seen by The Sunday Times. The estimated £1bn scam was “concealed” by several HBOS executives, according to a report by a senior employee at Lloyds, which merged with HBOS months later.
Lloyds has claimed that it “could not determine” whether anything criminal occurred in HBOS’s Reading ofﬁce until the trial that resulted in the jailing of two of its former bankers and four consultants, for charging small ﬁrms illicit fees in order to fund lavish holidays and sex parties with escorts. Internal emails referred to in the report show senior executives discussed the “fraud”. - The Times 2nd April 2017
The Financial Conduct Authority (FCA) has also announced it is investigating events surrounding the discovery of misconduct at HBOS. An FCA statement said: "This resumes an FCA investigation that was placed on hold in early 2013 at the request of Thames Valley Police pending the outcome of the Thames Valley police investigation and any resulting prosecutions. "The FCA’s investigation is focusing on the extent and nature of the knowledge of these matters within HBOS and its communications with the Financial Services Authority after the initial discovery of the misconduct."
IBAS Comments: “This is the only bank fraud case against bank customers businesses which has so so far been properly investigated by the Police and also where the perpetrators of the fraud have now been jailed - that is despite the many cases that have been taken to the Police for investigation in the last two decades. This case came about only because of the dogged persistence of journalists and specifically Ian Fraser who deserves massive recognition for his investigative journalism.
'The estimated £1bn scam was “concealed” by several HBOS executives, according to a report by a senior employee at Lloyds, which merged with HBOS months later' and as the Times reported (above) this fraud 'was covered up for nine years'. “It would be interesting to know just how much money Lloyds and HBOS spent on resisting the fraud claims and in ‘legally’ bullying and repeatedly chasing the owners of the businesses involved for payment of the sums outstanding, which were due because of the frauds committed on them by HBOS managers and their associates. Lloyds statement which appears to be damage limitation (and just words in a PR exercise) need to be analyzed later against just how many customers are actually compensated, by how much and also how much longer they are made to wait for compensation.
It appears the bank has acted to delay, refute and resist - which is the 'normal' bank strategy. Hopefully, the FCA may now 'investigate' a lot further and a lot deeper into why these frauds were not fully investigated by Lloyds and why instead they waited to see if the police might investigate. Cynics will question Lloyds motivation for that strategy and also question why such massive frauds against business banking customers were not reported immediately to the FCA and why instead Lloyds then also 'bullied' the victims of the fraud/s for payment. Again the FCA Principles of Business did not work and the customers have neither been treated fairly or honestly in these matters. I note that Ian Fraser raised his questions about the Bank of Scotland Reading scandal at the Lloyds AGM in May 2010 and he then questioned the Chairman on treating customers fairly! - Eddy Weatherill ceo IBAS
Credit Cards - Whistleblower wins 13-year campaign against HSBC Thousands of customers will be compensated for excessive credit card charges thanks to dogged efforts of 59-year-old Nicholas Wilson. A lone whistleblower has won a 13-year “David and Goliath battle” against HSBC and Britain’s chief ﬁnancial watchdog, resulting in a multimillion-pound compensation payout to thousands of people.
Letters are now arriving from the various debt collection agencies employed in collecting the debts and those who receive letters either writing off their debt or offering compensation might spare a thought for Mr Wilson and his plight - and then contribute to the fund set up to assist him. If he has helped you - now you can help him! - 31st March 2017
RBS accused of fraud and forgery by customers and ex-employee - Former business clients of the Royal Bank of Scotland are accusing the bank of systematically manipulating documents to cover up wrong doing. In an exclusive interview with the BBC, a former RBS employee has come forward to support allegations of document manipulation within the bank. RBS says it categorically denies document manipulation and forgery. Mark Wright started working for NatWest Bank in 1988 and was still there in 2000 when it was taken over by RBS. In 2005, Mr Wright accused two former RBS colleagues of concocting bogus complaints purportedly from ﬁve of his customers. He says the employees were from the bank's Group Compliance Unit established to deter misconduct and malpractice in RBS. He referred to the unit as the bank's "police". Mr Wright's ﬁve customers later submitted statements contradicting the bogus complaints. The two accused compliance staff subsequently left the bank. Mark Wright lives in the constituency of North Norfolk represented by former government minister, Liberal Democrat Norman Lamb. Mr Lamb said he has written to RBS ﬁve times to demand a meeting about Mr Wright's allegations. He said: "My fear is that it appears to be more than a few rotten apples behaving badly. There appears to be an institutional culture here that facilitated this corrupt practice. That's the allegation." - BBC Business 15th February 2017
Eddy Weatherill stated that: “Unfortunately, all UK banks have been guilty of systematic ʻcover upsʼ for the last three decades and over a very large number of issues - of which the regulators must be aware. The ʻcover upsʼ include ʻmanipulation of documentsʼ as ʻwhistle blowersʼ have claimed, which can mean copying signatures, altering contract details, deleting or altering internal notes, altering content from telephone conversations and destroying original documents. That short list is not exhaustive, there are many others. That is the nature of the banking ʻbeastʼ and that conduct has been ʻallowedʼ to take place for too many years because the FOS, regulators and also the courts have continued to accept bankʼs concealing documents and refusing disclosure of important information as a normality. Concealement remains an ʻissueʼ today in much of what banks do and regulators must be aware that they are just not doing enough to ʻclamp down on such unfair and dishonest corrupt methods and bank strategies, which then allow banks to ʻprotect themselvesʼ inside and outside of litigation - conduct which most ordinary people would consider as being well outside UK laws.”
A group of ﬁnanciers have been jailed for their part in a £245m scam after being convicted of bribery and corruption. - The six, including a senior banker, have been sentenced to a total of 47 years and 9 months in prison. Between 2003 and 2007, ﬁnance consultant David Mills, 59, used designer watches, exotic holidays and sex parties to bribe HBOS manager Lynden Scourﬁeld, 54, to approve inappropriate loans for struggling businesses. Mills, who was sentenced to 15 years in jail, and his colleagues were then able to charge the business owners signiﬁcant consultancy fees. Many of the ﬁrms went bankrupt as a result of the loans and some of the owners lost their homes. Scourﬁeld had been in charge of helping business customers who were facing ﬁnancial difﬁculties during his time at HBOS, but resigned from the bank in 2007. He was sentenced to 11 years and 3 months in prison for his offences. Judge Martin Beddoe told Scourﬁeld he had sold his soul to the devil. - Sky News 2nd February 2017
Former HBOS manager found guilty of corruption and fraud - Six people, including two former HBOS bankers, have been found guilty of bribery and fraud that cost the bank's business customers and shareholders hundreds of millions of pounds. Lynden Scourﬁeld, a former manager with HBOS, pleaded guilty to six counts including corruption. Five other defendants, including so-called turnaround consultants, were also convicted. In exchange for bribes, Scourﬁeld told customers to use the turnaround ﬁrm. Prosecutor Brian O'Neill QC said: "Many individuals suffered great ﬁnancial loss and considerable personal trauma as a result of their callous disregard for the businesses they had established, owned or managed." A decade on, HBOS's owner Lloyds Banking Group still has not acknowledged the full scale of the fraud - or offered to compensate its victims. - 30th January 2017 - BBC Business News
Eddy Weatherill says: "The news stories above illustrate the very real and newer threats to bank customers in the coming years and also the laxity of any worthwhile banking controls in the period from 2007 onwards - see my comments made on 20th November 2015. The issue now for those HBOS businesses who were destroyed by the frauds perpetrated on them by HBOS managers, is - can they gain financial restitution for the now proven criminal activities at HBOS from the Directors at HBOS prior to the Lloyds takeover or from Lloyds?
Independent Banking Advisory Service (IBAS) - launched in 1992 as a specialist unincorporated business banking membership organization assisting bank customers with UK business banking account loan disputes and business banking debt disputes with their bank. Our analysis and investigation of business bank loans, bank accounts, banking contracts, business banking account facilities and banking debt recovery information has been instrumental in our member's success.
IBAS business banking dispute negotiating experience has a proven strategy which provides claims and defences for business bank customers. IBAS has excellent banking investigation reputation and has featured on BBC TV, BBC TV News, ITV, Meridian and Sky News and contributed to editorials and articles for the Sunday Times, Times, Daily Mail, Daily Express and Daily Mirror.