Page 223 - Bank Case Studies

Tomlinson Report

In 2013, Lawrence Tomlinson, an

independent businessman who was the
Entrepreneur in Residence at the
Department for Business, Innovation and

Skills was asked by the then UK business secretary Vince

Cable to investigate problems small- and medium-sized

businesses were having with RBS. Cable also asked two

consultancies, Mazar's and Promontory, to do a report on

the GRG division in RBS for the Financial Conduct Authority.

In November 2013 the Tomlinson Report (11,29,30) claimed

that RBS made money out of struggling businesses by

placing them into RBS's "turnaround division" — the GRG

division claiming that, these businesses were engineered

into default. The GRG unit allegedly charged higher fees and

margins for the struggling businesses in the GRG unit and

this, in turn, allowed the bank's property division, West

Register, to purchase devalued assets. Tomlinson accused

RBS of systematically wrecking viable businesses.

Evidence from Tomlinson showed that 94% of SME’s
entering GRG were killed off for profit. A higher casualty rate

than front line soldiers serving in WWI. (2) Tomlinson who

banked with RBS was subsequently told by RBS that he

could no longer remain a customer of the bank who said

that the decision had nothing to do with the critical report.