Lame on blame: the RBS report

To say that it caused surprise and consternation when the FSA decided not to take enforcement action against any of the senior managers of RBS in relation to the 2008 collapse of the bank would be an understatement. The 452-page internal report on the subject gives the regulator’s view of what happened and why nobody should take responsibility for it. Adam Samuel scrutinises the paper.

Adam Samuel BA LLM DipPFS MCISI FCIArb Certs CII (MP&ER) Barrister and Attorney may be contacted at AdamSamuel@aol.com. His book, ‘Complaints and Compensation: a Guide to the Financial Services Market’, is available from his website, www.adamsamuel.com. Adam will speak at Infoline’s Product Development Risk and Complaints Management Forum conferences, (details on page 28).

The background to the FSA’s report on RBS is widespread disbelief regarding the regulator’s decision not to take individual enforcement action against any of the bank’s senior managers, above all, Sir Fred Goodwin. They ran the bank into the arms of the UK taxpayer and seem to have slipped away almost unharmed except in terms of their reputations and an undertaking not to take a senior management position in the banking sector given by the head of Greenwich Capital Markets, Johnny Cameron. Any analysis of such a report has to assume that the facts stated in it are accurate. Still, on the question of the decision to take enforcement action, one is left feeling that most of the conclusions reached could easily have been reversed and perhaps would have been in the case of less well-resourced individuals.