Tuesday, 12 November 2019

IBAS Christmas warning

Directors UK Bank Personal Guarantee Debt Claim Demands and the IBAS Christmas Warning Post

  • Christmas 2019 is now fast approaching and Banks will use their normal strategy on legal claims.
  • That means they will be already preparing their Christmas legal claims.
  • Many are prepared deliberately to drop through your letterbox just before 'close of business' on Christmas Eve.
  • Getting 'advice' for a Director's Personal Guarantee Debt Claim around Christmas and New Year is extremely difficult.
  • Banks know that and whilst they have easy access to solicitors at all times their customers will not.
  • Between Christmas Eve 2019 and 2nd or 3rd January 2020 is a normal holiday period for most in the UK.
  • Therefore, good strategy (although extremely unfair) for banks to issue a claim ready for Christmas Eve.
  • The 'service' on you will be deliberately timed for maximum effect for the bank's benefit.
  • The legal clock starts ticking once a claim is 'served' and it puts the customer under extreme 'time' pressure.
Losing 10 days in the Christmas - New Year period does not help someone with a legal claim to obtain help.
  • Banks know that customers are forced to react - which means many customers will also attempt a DIY response.
  • Banks love DIY responses, as they know they will normally lead to the bank obtaining an 'easy judgement'.

The customer just doesn't react at all and judgement is obtained by the bank by default. DIY responses also miss possible defences which may be effective for a legal argument to avoid 'strike out'. We would suggest that anyone who already knows there is a bank claim 'lurking' against them obtains help.

Do not get 'rushed' into answering a bank's legal claim without any help at Christmas.

Drop IBAS an email and we will explain what can be done.

Monday, 8 July 2019

The FCA must stop making excuses and act to avoid another GRG scandal

The FCA must stop making excuses and act to avoid another GRG scandal
Baroness Bowles is a Liberal Democrat peer in the House of Lords and her views were published by City AM on 27th June 2019:
“It is six years since the damning accusations came to light that the Royal Bank of Scotland (RBS) had been decimating small businesses for its own benefit. 
It was in fact a businessman, an adviser at the time to Vince Cable as business secretary in the coalition government, who uncovered and pulled together the dossier accusing the bank. 
Following a five-year investigation, the Financial Conduct Authority (FCA) has now produced its report on the scandal. It is disappointing: its conclusion finds no one guilty, and its only answer to what happened there is a gap in our regulations. Not exactly ground-breaking. So, today my Liberal Democrat colleagues and I have secured a debate in the House of Lords to urge the Conservative government to join us in demanding action. 
The scandal started with Global Restructuring Group (GRG), a unit which sat within RBS. GRG was in theory set up to help turn around the fortunes of struggling businesses which had taken out loans with RBS. 
But the reality was far more sinister; RBS bullied business customers to move to GRG by demanding instant repayments. Customers were then stripped of their assets in order to benefit GRG’s own bottom line.” 
“GRG dealt with large companies as well as small ones, but, as has been widely reported in the media, it was for the most part the SMEs which were “mistreated” at the hands of RBS – 92 per cent, in fact. 
“Mistreated” is an understatement. Lives were ruined as RBS customers lost their livelihoods, their homes, and in some incredibly tragic cases, their lives. A leaked training document for RBS staff stated: “sometimes you need to let customers hang themselves”. 
The FCA’s report, although damning about RBS’ conduct, is shamefully weak on plans for enforcement. It presents a catalogue of excuses of why action cannot be taken both against RBS now, and to prevent this from happening again. 
Neither of these is an impossible ambition. Under the FCA’s existing Principles for Good Regulation: “a firm must take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management systems”. RBS’ behaviour clearly falls short. This has been used before to pursue banks for the unregulated activity of foreign exchange, so why can it not be used for commercial lending for SMEs? 
It is equally outrageous for the FCA to imply that commercial lending to SMEs is not systemically important. There are 5.6m SMEs in the UK employing over 16.2m people – they are a crucial part of our economy. And RBS was the largest lender for them. 
The FCA also claims that because RBS’ activities are unregulated, with no standards set, there is nothing to measure “fit and proper” against. But, undeniably, the actions of those working at GRG fell well below what can be seen as fit or proper.” 
“Finally, the FCA has said that it was previously powerless to investigate GRG because the unit was outside the regulator’s remit. Now, new powers mean that if a similar situation were to occur again, the FCA might launch a probe, but apparently it would be “inappropriate” to look at the GRG scandal using those new powers, and it is far from clear that the powers would lead to significant enforcement. 
This is simply not good enough. Not only does the FCA owe it to victims to launch a thorough investigation, but it should be implementing regulations to ensure that this cannot happen again, not merely focusing on giving itself powers to investigate if it does. 
GRG unfairly destroyed lives, repossessed homes, acted aggressively and without transparency or proper control. What happened at RBS cannot be repeated, and the FCA must be at the forefront of ensuring this. 
The Liberal Democrats demand better and the victims of the scandal deserve it. Commercial lending for SMEs must be regulated. The FCA must stop making excuses and act. To fail to do so is to leave all those vulnerable to the same treatment that caused this scandal in the first place.” 
Baroness Bowles opinion follows the FCA publishing their report on the 13th June 2019 (as shown below):
FCA slammed over ‘whitewash’ RBS GRG report - The Financial Conduct Authority (FCA) today published its report into why it was unable to take enforcement action against senior individuals within the GRG, which has been accused of stripping its customers assets to shore up its own balance sheet at the time of the financial crisis. 
Kevin Hollinrake MP, co-chair of the APPG on fair business banking, said: “This report is another complete whitewash and another demonstrable failure of the regulator to perform its role. 
“The FCA must publish a full account of its findings including naming those responsible for the shameful mistreatment of thousands of UK SMEs.” 
“Phase two of the FCA’s own final requirement notice was supposed to ‘consider the root causes’ and establish whether ‘the causes of such treatment were known about, authorised by and/or sanctioned by management within RBS Group’. They have manifestly failed to do this. - City A.M. 13th June 2019