RBS restructuring group victims face ticking clock on complaints process
The bank said it has offered just £125m to date.
Time is running out for small businesses to lodge complaints over the way they were treated by Royal Bank of Scotland’s controversial restructuring unit.
RBS announced on Friday that the Global Restructuring Group (GRG) complaints process would close to new claims on October 22, nearly two years after its launch.
It has so far offered a total of £125 million to victims of GRG, the now defunct turnaround unit that has been accused of pushing firms towards failure in the hope of picking up assets on the cheap.
That includes the £115 million offered to 3,500 customers as part of an automatic refund process which ended in July last year.
A further £10 million has been put forward to 370 complainants out of the 803 cases that have now been closed.
The bank said it has received 1,230 complaints from around 16,000 customers eligible to use the scheme to date.
RBS has put aside £400 million in provisions to cover the GRG compensation scheme, which included set-up and running costs.
The lender said it is now receiving around six complaints a week, having declined from a peak of around 35 per week in December 2016.
The closure of the programme does not have any bearing on legal cases launched outside the scheme, and those who make a complaint after it closes will be able to use the bank’s normal channels – meaning there will not be an option to appeal to an independent third party.
The process is overseen by an independent third party, retired High Court Judge Sir William Blackburne, who has received 169 appeals and upheld around 15 cases in full or in part, resulting in total awards of £38,000 in additional redress.
The bank’s chairman, Howard Davies, said: “Throughout the GRG complaints process – which was first announced more than 18 months ago – our focus has been on putting things right for those customers who did not receive the level of service and understanding they should have done whilst in GRG.
“We have worked hard to ensure high-quality and fair decisions have been reached in response to the issues raised.
“These have been subject to rigorous independent assurance.
“The number of complaints is continuing to decline and, with the independent third party agreeing to accept consequential loss appeals, we have concluded that this is the appropriate time to give our UK customers notice of its closure to new complaints.”
A much-anticipated report into GRG by Promontory Financial Group was finally published earlier this year, showing that there was “widespread inappropriate treatment of customers” inside the unit.
However, it said there was no evidence that “defaults were engineered to transfer businesses to GRG simply to generate revenue for RBS through fees”.