Category Archives: Bank of Scotland

Now Is Not The Time To Stop Lobbying For Ethical Change.

I wrote this blog at the beginning of February this year but didn’t post it – I can’t remember why and I probably just got distracted by something to do with a bank! Anyway, today the article about George selling off Land Registry reminded me about this blog and why charitable or not for profit organisations like SME Alliance need to be lobbying more rather than less – and now we also need to lobby for the right to lobby!! If we don’t, I fear very soon freedom of speech itself will be threatened.

Happy Easter to all.

Nikki

Now Is Not The Time To Stop Anyone Lobbying For Ethical Change.

It seems the Government are closing yet another door to democracy. I find the announcement last week that charities cannot use State money (tax payers money) to lobby for any changes in the law, quite sinister and quite sneaky. Not least for charities who campaign for justice – of which there are many. I suspect funding from Government is quite minimal to such charities anyway but, whatever the amounts, it is likely to be diminished to any charity that dares to speak out against Government policy.

What I find so offensive about this new ruling is the fact that while Sir Stuart Etherington, chief executive of the National Council for Voluntary Organisations, is right and this could result in charities, taking “a vow of silence”, it will also very definitely mean even less opposition or challenge to the mighty ‘lobbying machine’ of big business. It is already an inequitable situation because most charities are struggling for any kind of funding post the credit crunch and unlike big business, charities are not based on profits but on positive action for good causes. When charities lobby for a change in policy or law it is generally in reaction to what they have seen as the consequences of either ‘bad law’ or evolving necessities. When big business lobby’s, the goal is invariably market share, shareholder value, reduced regulation or, let’s face it, how to keep fat cats fat. And in far too many cases, ‘The Ministry of Revolving Doors’ means MPs or regulators have a keen interest in keeping big business happy.

I’m no expert in lobbying but, even a quick surf of the net shows just how important lobbying is. For example this simple explanation in the Guardian (March 2014) clarifies what lobbyists do:

http://www.theguardian.com/politics/2014/mar/12/lobbying-10-ways-corprations-influence-government

To a certain extent we are all aware of what lobbyists do and we’ve got used to the idea some companies believe (probably correctly) the best way to get results is to rely on the familiar maxims “you get what you pay for” and “it’s not what you know, it’s who you know.” If there is no other side to the coin i.e people lobbying for something just because it is fair, equitable and with no financial gain, then what we’re really doing is paving the way for important laws and policies to be swayed or decided on a ‘highest bidder wins’ basis.

What the Government is proposing is a curb on legitimate challenge by charitable organisations by restricting their ability to fund lobbying activities. This is rather like our inequitable two tier justice system whereby very few individuals or SMEs can ever challenge big business (especially banks) in the Courts because they have been priced out of the system.

I found an interesting article in the Bureau of Investigative Journalism about our Top 10 most powerful lobbyists – although the article does date back to 2012 and this list of names has probably changed by now:

https://www.thebureauinvestigates.com/2012/07/13/britains-10-most-powerful-finance-lobbyists/

Of particular interest to me was No.2 on the list, Anthony Browne, Chief Executive of the British Banking Association. This organisation is funded by its members – the banks – to the tune of £7,729,000 in subscriptions (2014) and no one can say Mr Browne hasn’t done a good job (from the bankers point of view). Recently we’ve seen; the review into banking culture cancelled; various reports delayed for so long it means they are now about as useful as wet loo roll; a complete u-turn on holding senior bankers responsible for what happens in their banks and; any number of deals brokered for banks to pay their way our of repeated misconduct against consumers, breaches of financial regulation or even criminal prosecutions. Even if Mr Browne has slipped down to 4 or 5 on the list, surely it is hugely important to maintain a serious opposition to the powerful banking lobby?

If I had to say which banks have been most damaging to the members of SME Alliance, I’d say RBS is top of the list, followed by Lloyds/HBOS. Both banks were bailed out for billions of pounds by the tax payer and they have both paid a fortune in fines or compensation for various examples of misconduct. Both have representation on the BBA Board:

https://www.bba.org.uk/about-us/bba-board/

And both are represented by one of the most powerful lobbyists in the Country (and Mr Browne is just one of many powerful lobbyists for the financial sector). So – tax payers bailed out these banks and they are able to use tax payers money to lobby at the highest levels of Government in the same way they have used tax payers money to pay their fines, fight their battles in the Courts and continue with their telephone number pay packets to their senior executives. But the charities who are busy mopping up the catastrophic austerity the banks were so instrumental in causing, cannot use tax payers money to lobby for change or reform in banking or anything else.

Why? Because, according to Cabinet Office Minister, Matthew Hancock “Taxpayers’ money must be spent on improving people’s lives and spreading opportunities, not wasted on the farce of Government lobbying Government.”:

http://www.dailymail.co.uk/wires/pa/article-3434720/Charities-set-ban-using-Government-grants-lobbying.html

Yes, you have read that correctly – charities can’t spend tax payers money lobbying MPs for anything because the Government wants all charitable donations made on our behalf to be spent on making our lives better. And if you believe that, you’ll believe anything. I think Mr Hancock is relying on the logic of La La Land and his statement is wrong. As long as this Government continues to be happy for the Country to be run for the commercial gain of a minority, it is crucial tax payers money is spent on exposing such an undemocratic system and that charities have every opportunity to be as vociferous as possible about any and everything they identify as detrimental to society because of bad law, bad law enforcement or inequitable access to justice.

Reading the list of the top 10 most powerful lobbyists in Britain, I would say the financial sector is becoming a bit of a ‘lobbying cartel’ which doesn’t just have the ear of the Conservative party, it controls the whole head, arms, legs and torso. When the Conservatives were voted back into power, it seems the real victory was for ‘The City of London’ and now the ‘masters of the universe’ have found another way to make its ‘puppet’ limit any further opposition to its avaricious and anti social plans. What next I wonder? We’ve already seen the results powerful lobbying has on Government (all three of the main parties) – the most obvious being soft touch regulation of a corrupt financial sector that brought the whole country to its knees and has seen thousands of people relying on food banks. Now we’re going to see ‘the consequences of inequitable lobbying power.’ Maybe we should all order in a good stock of banana’s before the next insidious brain wave.

Ironically and without doubt this latest and dangerous lunacy has come about because of powerful lobbying. And the spin factor, that ‘it’s all for our own good’, is very offensive and implies this Government thinks we, the public, are all very stupid. Now is not a good time to stop Charities lobbying – it’s time we all started lobbying our MPs to take power back from big business before we really do become a Banana Republic.

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Justice delayed is justice denied #HBOS

I wrote this blog on Tuesday 6th October 2015 but I didn’t post it because I didn’t want to tempt fate. Unfortunately fate is doing it’s own thing right now and my premonition was no more than logic. Dressed up in different clothes but all the same, on 9th October 2015 the HBOS Reading trials were put back to September 2016.

There is nothing in this blog that breaches sub judice. This isn’t about the merits of the case it is only about the conduct of the case and I make no mention of the content of the allegations. I would however point out that 9th October was a very very sad and even catastrophic day for a lot of people – but, as always, that seems fairly immaterial to the situation and, as far as I know, no one considered the victims when the case was moved.

Justice delayed is justice denied (written 6th October 2015).

Six years ago today Paul and I finished writing a report for the FSA on the subject of HBOS Reading. At that point we had already been investigating events originating at HBOS Reading (that’s the PC description) for over two years. Also at that time we were living on the bread line, our business had been trashed, HBOS/Lloyds had already tried to evict us about 17 times (22 times in total) and no one was really interested in our allegations of fraud.

In 2010 Thames Valley Police finally started an investigation and 12 people have been arrested. It took until January 2013 for anyone to be charged and the criminal trials were due to start in January 2015. But in October last year, the victims of HBOS Reading were suddenly told the trials had been delayed for a year. They are now due to start in January 2016 – or are they?

Call me a cynic but the articles in the press yesterday about the Chancellor, George Osborne’s intentions to off load £2BN worth of Lloyds shares with various discounts and incentive schemes thrown into the pot, rang some alarm bells. This bargain basement sale is due to have completed by Spring 2016 and I can’t help but wonder if a major criminal trial about events in Lloyds unruly pup HBOS is really going to persuade the public they want to get involved with Lloyds?

Of course Lloyds don’t need to rely on the antics at HBOS to tarnish their reputation. At SME Alliance we see examples of outrageous and potentially criminal bank conduct every day and while it would seem Lloyds can’t actually hold a candle to RBS, they don’t do so well in the popularity stakes. Lloyds have huge issues to address and plenty of group litigations to look forward to. Do they care? According to Rowan Bosworth-Davies, giving a powerful speech at an SME Alliance meeting yesterday, top bankers consider themselves to be a protected species. I have no doubt he’s right and that’s exactly what they believe.

However, what worries me more than the conduct of bankers is the conduct of politicians and the judiciary.

To be honest, if I was George Osborne I would be absolutely desperate to get rid of all and any shares in RBS or Lloyds – and he clearly is. Apparently RBS are now going to buy back their own shares to help the Government out: http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/11900014/RBS-could-buy-back-its-own-shares-to-aid-Government-sell-off.html

Meanwhile Lloyds are now going to become the best thing since SID. Fine, and I really wouldn’t care (because I can see why George is doing it, although the ethics of letting RBS buy their own shares with the money they borrowed from the State, does seem something that would have Mr Micawber turning in his grave) except that, in the case of Lloyds, I have a horrible feeling that all those skeletons Mr Horta Osorio wanted dragged out of the cupboard when he took over as boss, are about to be put back in and even bricked up.

HBOS is a delicate subject in anyone’s book and I suspect the forthcoming book ‘Crash Bank Wallop’ by Paul Moore, the HBOS Whistleblower and a good friend, will be considered by some as being as delicate as the trigger on a hand grenade! There’s nothing the authorities can do about that and I dare say Mr Horta Osorio will react in a similar way to David Cameron when Lord Ashcroft’s book about him came out. In the name of dignity he will just try and ignore it. But it will rankle and it will beg the question “why the hell did Lloyds get involved with a basket case bank?”

Then there’s the HBOS report which apparently some MPs are getting a bit tetchy about. As I blogged the other day, we have been warned about the likely redactions. But in my opinion, redactions won’t be enough. I think it’s likely to be delayed again and, if not, the redactions and re-write’s to protect the great and the good (not Hornby, Cummings, Stevenson or Crosby – I don’t think they are a protected species any more) will mean the report has limited value. We may get something in October as we’ve been promised but I’m guessing the full report, when all the Maxwellisation and Re-Maxwellisation has been completed and enough lawyers have made sufficient money to sail off to the Cayman Islands in a beautiful pea green boat, will appear late Spring and after the Lloyds shares have been sold. And on whose orders?

A lot of people will be eager to read Paul’s book and the HBOS report (believe me, the book will be the better read). However, the victims of HBOS Reading are not waiting to read a book. Not even my book which is about HBOS Reading. We are waiting to get our lives back and we’ve waited a very long time. Given the trials are about events that happened between 2002 and 2007, some of us will have been waiting 14 years by the time the trials are over. And the idea (and it is only a suspicion) that the trials will be moved again to fit in with the Lloyds share sale or for any other reason, makes me feel physically sick. Not only because I am tired, I’ve had enough and I want out of the nightmare this has become – but because I am literally terrified at the idea politicians can manipulate the criminal justice system to suit their ends and those of the 1%!

Surprisingly I have a lot of friends who are lawyers, barristers, QCs and even the odd Judge. They are good people and I know many of them care passionately about justice. They are also common sense people and I know many of them have campaigned against the cut in legal aid and the rise in court costs for people who can ill afford to take on gigantic corporate organisations.

SME Alliance relies on the good advice we get from good people in the legal world – some of our members haven’t always had good advice but we are gradually getting together a very good team. When I explain to my friends how often the Reading trials have hit delays and for how long, they are shocked. I’m not sure our new friend Rowan Bosworth-Davies will be shocked if, for what ever reason the HBOS Reading trials are moved to late Spring. I don’t think my good friend Brian Basham will be shocked nor will Paul Moore be shocked.

I won’t be shocked but I will be devastated. If it happens and I genuinely pray we won’t have another delay, it will cause untold pain, misery and unhappiness for a group of people who are already at the end of their wits. And personally, whatever reason is given for another delay, I will find it hard not to think it is to accommodate George Osborne’s sale of the Lloyds shares. And, were that to be the case (although of course that would never be the reason given) that would be a bad day for democracy and for truth and justice because, whatever politicians do and what ever power they have, they should never have the power to interfere with justice.

 

 

 

Dear Sirs, this is hardly flattering. Please redact. #HBOS

IMG_3454I’m confused – for years now the FSA followed by the FCA have been looking into the conduct of HBOS. Whether or not he is considered good guy or bad guy, I know Hector Sants (who admittedly took some persuading) was eventually keen to get to the bottom of what had been going on in HBOS and he wasn’t in the mood for ‘cover up’ when he released the BoS Censure Report in March 2012. Not long after that he mysteriously went from being the golden boy tipped to take a top job at the Bank of England, to relative anonymity. Since then nothing has been heard about the Section 168 Report commenced in June 2010 specifically into HBOS Reading (probably because of the ever pending criminal trials due to start in January 2016) and the overall report into HBOS and its top management has been continually delayed.

Articles in the press yesterday seem to confirm that report will be out next month (October 2015). However, even now, after the endless delays and God knows how much spent in legal fees by the Bank (I imagine Lloyds has picked up the bill for Stevenson, Hornby, Cummings and Crosby – if he’s actually included) and the regulator, we have now been warned to expect redactions.

How does that work? The regulator does an in depth investigation into the catastrophic demise of HBOS and the people who were running the Bank don’t like the conclusions the FCA have reached – so they are able to have certain parts redacted. I’m not saying the report found anything criminal (although in my personal view I fail to see how it couldn’t have found some very shady conduct) but even in a civil court, could someone ask a Judge to redact the bits of evidence they don’t like? Imagine, “your honour, I don’t think the evidence before you puts me in a favourable light so I’d like that bit crossed out.” I would love to have any current photo taken of me photo shopped so I look thirty years younger but the truth is, I’m not. These possible redactions are similarly trying to change history – and it can’t be done. Neither should anyone countenance attempts to do so.

I have been told (repeatedly) that the FCA has quite extraordinary powers, should it care to use them. I know the powers of the FSA were split between the FCA and the PRA but all the same, how can top bankers or their legal teams, oblige the regulator to redact the findings of its own report? It makes no sense. Neither does the sharp ‘Harp’ exit of Mr Wheatley make sense. I find the whole thing very concerning. Rumour (or the media) has it, Mr Wheatley was too ‘consumer friendly’ and this did not fit in with Mr Osborne’s plans to make sure the City Of London retains pride of place in the financial world. Which is a bit odd because lately, even the BBC has been portraying the Square Mile as something akin to the Guild of Thieves from the Disk World.

Therefore, what worries me is this: if Mr Wheatley had to go because he wasn’t banker friendly enough, how can we expect Mr Osborne to allow a full, frank portrayal of what went on at HBOS?

Although various MPs and, I think, the TSC have demanded to see any redacted passages, how can other people, who have first hand experience of what was going on at HBOS, ever challenge what they will never see? I do know what some of the information and evidence the PRA received to contribute to this report was, as I sent some, as did Paul Moore. We didn’t send it randomly in the hope someone would read it, we were in direct contact with the PRA and the Bank of England via the Governor and we know they all received and read our evidence. Consequently we have our own views on what the FCA Report should include. It’s not a pretty picture and I have often wondered how the bankers concerned would refute this evidence? Well obviously, if the contentious or nasty bits of the report are redacted, they won’t have to!

Redaction has been a big issue with SME Alliance recently. Members sending Direct Access Requests (DSAR) to get their information from their own central files in banks (mostly RBS) have received such varied replies, we’ve asked both RBS and the Information Commissioners Office (ICO) to clarify exactly what members should expect to get. The answers so far have been as clear as mud but it is pretty clear no one should be getting entire pages redacted. Neither should anyone be getting information that has been manipulated or tampered with (that’s another story coming soon). We are struggling to get to the bottom of Section 7 of the Data Protection Act 1998 and a definitive interpretation. But I’m not sure Section 7 of the DPA was ever intended as a barrier to regulators publishing reports on banks or bankers! Neither was Maxwellisation and the remarkable Re-Maxwellisation meant to be used as a means of delay or ‘cover up.’ These are clearly new techniques invented by the very clever (and well paid) lawyers of La La Land – but that doesn’t mean we or the regulators should blithely accept them.

My other concern is that while this report may actually be more candid than others before it (I’m remembering the 1 page press release fiasco from Lord Turner about RBS http://www.publications.parliament.uk/pa/cm201213/cmselect/cmtreasy/640/640.pdf ), it will be written in such a way as to minimise any potential legal actions against Lloyds Banking Group who merged with HBOS. Contagion is a huge issue for the banks and I’m sure the emphasis of this report will be on “this is what HBOS did but Lloyds were totally unaware of any of this.” Which begs the question (again) – why would Lloyds go ahead with such a critical merger without knowing chapter and verse of what they were getting involved with? Money laundering rules being what they are these days (or profess to be), banks need so much information to open an account, I’m waiting for “what colour knickers are you wearing” to be added to the list of KYC questions. So it is inconceivable Lloyds had inadequate detail about their new partner. And, in my opinion, Lloyds didn’t just merge with HBOS, they’ve done a pretty good job at morphing into the same sort of unethical and unattractive organisation.

Last thing – I know many victims of HBOS have waited years now for some sort of closure. The criminal trials regarding HBOS Reading have taken years to happen (if they ever do) and the various reports on HBOS have been endlessly delayed and now (probably) redacted. While I don’t suppose the ex management of HBOS have been quite as cavalier about the FCA report as they were about running the bank, I very much doubt if any of them have suffered anything like the hardship the banks’ victims have. Some of us have had our businesses ruined and our lives on hold for many years. Not to mention the many people who lost their savings and their retirement plans via the disastrous way HBOS was run. So I really hope, regardless of the HMT’s desire to hang on to its golden goose (that many of us feel is actually a dead duck), that when the HBOS Report does finally come out, it is as honest as harsh and as damning as it should be. Hector left us with the BoS Censure Report – before Mr Wheatley left, let’s hope he finished the job and, for once, let the blame fall where it’s due.

Save The Bank, Call In The Diplomats! Really??? #RBS

IMG_5058aBefore SME Alliance was started, I would have been hard pressed to believe any bank could behave as badly as Bank of Scotland and its keeper Lloyds Banking Group. Now I’m pretty sure RBS could give HBOS/Lloyds a run for their money in the bad banking stakes. Not a day goes by without a new nightmare story about RBS or Nat West arriving in the SME Alliance in box. Which isn’t to say HBOS/Lloyds has been knocked off my top spot but is rather, a sad reflection of how systemic malpractice is in our banks.

Consequently I don’t know whether to be shocked by the news Jacob Rees-Mogg has asked UKFI to call in the troops to get RBS out of it’s £5BN fine from the US, or whether I think he has a point? From my own point of view it’s tough enough to get RBS to compensate the many UK firms it trashed in its GRG division or it has forced into bankruptcy with exorbitant exit fees for destructive products like IRHP. In fact it’s hard enough – in the face of indisputable evidence, to get them to admit black is black. Paying £5BN to the Americans will surely make it even tougher for UK victims of RBS to get compensation? And what about shareholder (taxpayer) value? We’re already reportedly going to lose £13BN on the sale of RBS – do we have to add £5BN to that figure?

On the other hand, as the US authorities have levied this penalty for the banks sub-prime activities, should RBS, yet again, get away with no penalty? God knows why (and he’s not telling) but apparently senior bankers can’t get prosecuted for the multi billion pound scams they over see, so would it be right to use diplomatic means to curtail the US ability to fine banks as well?

I think this is quite an extraordinary conversation reported in the Telegraph today:

(UKFI) “Are you saying to the Treasury they should use the government’s diplomatic efforts with our closest ally to avoid the British taxpayer being fined $8bn by the American taxpayer?”

(Mr RM)“If I were you, I would be saying, what is the British embassy for if it is not trying to get RBS off this fine? Our closest ally fining us $8bn is pretty stiff.”

There’s a spin and a half. This suddenly isn’t about the misconduct of RBS in America and the penalty they should pay. No, this is about American taxpayers trying to fleece British taxpayers! And if the Americans don’t want to go along with this so called justified diplomacy to get RBS off the hook, what next? Call in the tanks? Really?

Leaving the American issues to one side for a moment, yesterday an article in Reuters, suggested Ross McEwan may have to admit the GRG division of the bank actually did do what many of us have been screaming from the roof top for years – it has been deliberately ruining SMEs and taking (stealing) their assets. Apparently the FCA have “got something” which is a bit of a game changer and the forthcoming report will expose this – or some of it. And this news has come out now because? In my opinion I’d say it’s because the bank is preparing us for an announcement in the near future along the lines of:

we are shocked to discover that in certain instances the allegations made about the treatment of SMEs by the GRG division may potentially have some validity. As a result of the FCA investigation we now have enough evidence to show a small number of SMEs have indeed been poorly served by the bank and we will, of course, make enquiries into what happened in these cases with a view to contacting affected parties.”

Someone who spends a lot of time investigating what goes on in RBS told me a few days ago that, in the event all the outstanding issues RBS has with SMEs were to be addressed, the bill for proper compensation would be in the region of £40BN. Of course that’s not going to happen. If politicians are kicking off at the idea RBS have to pay the US £5BN, what are the chances this Government would allow the bank to pay UK SMEs eight times that? None. The Government may not have any full proof way to stop the US getting its money but they have all sorts of ways to make sure SMEs can’t get theirs. It’s a tall order for most SMEs to even get into a Court room to progress a claim let alone take on the bank’s mighty legal teams.

All the same, I know there are some very determined people out there and some big class actions in the pipe line. With such large losses looming, George Osborne must be worried about the share sale he is so determined to achieve. That’s without even considering the debate on whether or not he should be selling RBS in the first place. I know there’s many organisations and campaign groups who feel RBS should just be nationalised and then split up into smaller banks that would at least be of some use to society. I would agree except that we’ve already lost a fortune on this bank and nothing I have seen or heard in the past 6 months convinces me of anything other than the fact RBS is heading very fast into a brick wall.

Whether the bank is sold back into the commercial world or nationalised, the barrage of allegations and litigation heading its way is not going to stop. And some of the things coming have not even been mentioned yet – in fact I don’t even know if Ross McEwan is aware of what’s coming? I’m very sure the FCA doesn’t.

I suppose another option is if Jeremy Corbyn were to become Prime Minister – he might nationalise RBS, insist no shareholders got anything and no one could could litigate against the bank? But I can’t see that going down well with anyone and least of all the bankers who might then be asked to live on a normal wage.

So what should happen to RBS? Who knows? My husband thinks (and he even said it in a meeting at 10 Downing Street) the only way forward between the banks and the SME sector is a “truth and reconciliation” scenario. It would cost a lot for the banks to come clean and work out suitable compensation for the thousands of SMEs they’ve gratuitously ruined but, were such an agreement even vaguely possible, everyone, including the SMEs would have to take a reasonable and moderate approach. And the billions of pounds the banks would save on expensive lawyers, barrister and court fees would go a long way too righting wrongs, getting the SME sector back on it’s feet and re-establishing some trust.

#RBS to sell or not to sell – won’t make any difference to the fact this bank has backed itself, the Government and the Country into a corner. And no, Mr Rees-Mogg, the British embassy is not there to protect a British Bank from the consequences of its own misconduct. The tax payers didn’t ask for the opportunity to bail RBS out and become shareholders – it was a fait accompli. As such, one would have thought our own Government, regulator’s and justice system (not to mention UKFI) would have been keen to protect the public investment and stop our bankers behaving like bandits.

One last thing – Nick Gould and I had a great meeting this week at the Metro Bank with Peter Musumeci Jr, the right hand man of Vernon Hill. I’m not saying the Metro Bank is perfect and any SME owner could waltz in there tomorrow and get exactly what it wants. However, not only would I say the ethos of the Metro Bank is refreshingly different to our big banks, they also listen and wanted to know what are the key things the SME sector is looking for in a bank. Funnily enough, a lot of what we want is contained in the FCA Principle for Business, starting with principle 1. Integrity. Sadly integrity has been off the menu in some banks for so long I can only think some of our more illustrious bankers have forgotten what it means.

Photograph © Laura Maria Photography 2015

Maxwellisation? Enough already.

So first we had the so called ‘credit crunch’. Bankers all over the world, all paid telephone number fees, ran banks into the ground and brought various economies to their knees. Then we had the bailouts – Governments all over the world and not least the UK, decided the best way out of the ‘credit crunch’ was to give the banks billions of pounds, dollars, Euro’s, you name it, they gave it, to the banks to replace what they lost in their bizarre spending frenzy. And that resulted in mass austerity across the UK, Europe and the US – probably elsewhere as well but I’m not an expert.

Then came the clean up – or the apparent clean up. What happened to cause the credit crunch and how regulators and Governments could ensure we wouldn’t get a repeat performance anywhere in the near future? And how was this clean up done? Well that’s the latest page in the most bizarre story of the 21st century history book – we clean up by burying as much truth as possible and where we can’t – because the public are demanding explanations – we introduce Maxwellisation.

I’ve read various explanations of Maxwellisation and they make as much or even less sense to me as the fateful and long drawn out love affair on the Maxwell House advert. I don’t know what happened in the agonising and tragic story of a love affair that was almost but never quite fulfilled. I certainly don’t know what it had to do with coffee! And similarly I don’t understand how the exploits of Robert Maxwell – who apparently ripped off not just his own company but also pension funds – could be introduced as a legitimate way to stop the rightful exposure of wrong doing?

I may be mad but surely we’ve got it the wrong way around? If our regulators and their third party experts do in depth investigations into situations and come up with explanations, in the form of reports, which finally expose the truth, how can it be right that the people named and blamed in those explanations, can challenge the reports before they are released? Are we saying our ‘experts’ and our regulators may have got things completely wrong? Is it in the nature of ‘experts’ who spend years doing these reports at vast expense to the public, to get it completely wrong? Is that an equation our regulators start with? I don’t think so.

This is like an appeal in the justice system happening before the trial. So the crooks, let’s say for the sake of argument bank robbers, receive the prosecution case and, before a Judge or a jury gets to hear it, half of it is removed because the accused don’t like it or they don’t agree with it. Better still, the accused’s lawyers may be able to come up with legal technicalities as to why the allegations can’t even be made in the first place. So what the Judge or the jury finally get to hear is an edited version of events as permitted by the defendants. Wow, I can see that going down very well with the criminal fraternity. Not a luxury extended to Tom Hayes but surely one the magic circle lawyers will be insisting on for more senior bank management in the future.

As someone who has spent years of my life investigating bank fraud albeit from the perspective of someone who is actually in the rock & roll business, the one thing I know is ‘the written word doesn’t lie.’ Even if people have been deliberately writing lies, the culmination of a proper investigation will just highlight those lies and you will be grateful someone bothered to put the lies in writing as an example of fraud or corruption or, at the very least misconduct or negligence. For example – how could any bank relying on untold amounts of emergency funding from the Bank of England and then needing several billion pounds from the public purse, possibly pretend to investors that it’s a safe bet to plough money into a Rights Issue? But read this absolute twaddle from Andy Hornby back in 2008 http://www.thisismoney.co.uk/money/news/article-1631967/HBOS-chief-Hornby-defends-rights-issue.html and you’ll see that’s exactly what some of them did! Now what part of Maxwellisation can alter those facts?

Better still, let’s remind ourselves of exactly how the great and the good from HBOS and RBS were still trying to pull the wool over everyone’s eyes even after they’d been so instrumental in bringing the Country to the edge of the abyss: http://www.publications.parliament.uk/pa/cm200809/cmselect/cmtreasy/uc144_vii/uc14402.htm

That’s a cracking read by the way.

I don’t know how anyone would do a comprehensive investigation into why we went into the Iraq war although logic would say the absence of the weapons of mass destruction, which were the reason for so many tragic deaths, raises some terrifying questions. But in the case or RBS or HBOS, it’s just not that complicated. If two music publishers can expose a massive fraud in HBOS and if certain members of SME Alliance are supplying the Times with evidence of massive issues in RBS, how can the FCA and their ‘experts’ be so endlessly challenged on their findings? The whole thing smacks of the dreaded ‘D’ word – deals. Deals to hide what really happened in our banking sector. Deals to protect the so called great and the good. Deals which, rather than give the public some sort of closure on what happened and show who was responsible, will just ensure the same or worse happens in the future.

There is no point in Maxwellisation – it’s apparently not a legal requirement and all it is doing is staving off the inevitable. If either of these banking reports ends up as another whitewash, there’s a whole army of people out there who will challenge them. Journalists, whistle blowers, small organisations like SME Alliance, Move Your Money and Bully Banks – not to mention various forthcoming trials (criminal & civil) which will shed more light on the reality. Clearly, if the FCA keep delaying their reports or if they allow the truth to be watered down, others will happily set the record straight.

I would say, from a public perception, Maxwellisation should really be called Orwellisation. We are continually walking backwards to Orwell’s views of 1984. The important difference is, there was no social media in Orwell’s world. No twitter or Facebook or Linked In. And unless the powers that be can wipe out the world wide web, Maxwellisation is actually and ultimately just like the coffee advert – long, drawn out and a fantasy. We’ve had enough fantasy when it comes to real people’s lives. Just like the cream always goes to the top of the coffee,  the truth, as Hillsborough has shown us, also has an amazing way of coming out on top and Maxwellisation won’t change it.

Surely the public have been on the receiving end of too much abuse from bankers without this latest trickery? Let’s just get on with it please, let’s publish these reports and stop all this nonsense. As a very good friend of mine would say – enough already!

How much more contempt must society swallow from banks?

Interesting few weeks – the election of course with the Conservatives winning a majority – who saw that one coming? And, in the process, the Tories appear to have demolished most of the other parties, not to mention some key names in politics. Of course the SNP helped the Tories enormously – the idea of Labour with the SNP running Westminster had a devastating effect. It’s almost as if we collectively had visions of bearded, kilted Scotsmen rampaging all over England intent on rape and pillage, when we still haven’t recovered from the suited and booted Scotsmen who ran the Government and some of the big banks – so that didn’t help poor Ed. And this just goes to show that while we pat ourselves on the back for being a liberal, accommodating, multi cultural society, the truth is we’re every bit as Nationalistic as Germany, France or Italy. And why not? What’s wrong with being fiercely protective of your Country? And while, in this instance, we conveniently forgot Scotland is part of Britain, I think many of us did reasonably feel that is a tenuous situation which a second referendum could change.

Anyway the Conservatives won and that was certainly a relief to big business who were apparently sure Ed Miliband was anti business. But I wonder if anyone in politics could make a difference to the whims and pleasures of major corporations now – and especially our financial sector?

One thing that has been made abundantly clear (again) in the last week with a US Judge handing out multi billion pounds fines to our big banks, is how much more powerful banks are than Governments. If I was trying to explain to an alien what’s been going on over the last twenty years in the ‘Incredible saga between banks and society’ I would say:

“From the late 90’s, bankers decided they could make more money and bigger bonuses by forgoing traditional banking and behaving recklessly, unethically and with gay, greedy abandon until this conduct nearly brought even the wealthiest of nations to their knees by 2008. So Governments bailed the banks out with the monies they collect in taxes to pay for essential services, even although this caused mass austerity for millions of ordinary people. But we never really got to the bottom of the reckless behaviour and we certainly didn’t blame anyone. So bankers realised very quickly they could carry on with that kind of behaviour and nothing much would happen.

Pardon? Yes we do have laws on this planet and yes bankers did break them but the leaders running the various countries on behalf of the people, decided it wouldn’t be a good idea to apply the laws to the bankers? Why – well apparently it’s complicated (or so we’re told) and, aside from anything else, we, the public, would have felt loath to trust a financial sector where some of the bosses turned out to be convicted felons.

Yes I know some of them may well be ‘criminals in pinstripe’ but that’s not the point. You can’t just go around calling people crooks if our justice system hasn’t confirmed it – so the trick is, don’t prosecute people and then no one can say they’ve done anything criminal.

What happened next? Well obviously, realising they had immunity from the law and could therefore do what the f*ck they liked with no personal consequence, the bankers dreamt up even more blatantly criminal scams to make money because – what did they have to lose? And when they (banks – not bankers) were found guilty of crimes, either their share holders or the tax payer (again) paid massive fines on behalf of the banks to the organisations set up to make sure banks did behave well and didn’t break any laws in the first place.

No I don’t know why these organisations didn’t police the banks properly. But I suppose if they had, they wouldn’t have been able to demand billions of pounds in fines at a later date.

What happened to the bosses running the banks? Well obviously they got huge bonuses even although they were overseeing criminal operations. And let’s be logical – the banks may have been fined billions of pounds but that’s a fraction of the profit they made while acting illegally. So you could say these bosses were doing a good job in terms of making money – which is all banks care about.

Yes, you’ve summed that up beautifully – the people bailed the banks out when they lost everyone’s money; then the banks carried on robbing the countries blind while paying their executives millions of pounds and finally; the public paid the fines for their criminal conduct. It’s a total Catch 22 as far as society is concerned.

I realise it makes no sense to you – it makes no sense to most people on the planet. Don’t we have a say in all this you ask? Well yes we do. We vote for the kind of leadership we think will be best for society and who will stop this kind of thing. So why doesn’t it stop? I don’t know. And yes, I’d say society is deeply offended our elected representatives have given bankers immunity from the laws of the land. Many of us are trying to do something about it. I have written many a letter to various leaders asking for a logical explanation to what’s going on http://www.ianfraser.org/dear-mr-cameron-if-bankers-are-above-the-law-we-need-an-urgent-explanation/

I haven’t had any replies – no doubt our leaders are very busy trying to work out how to balance the scales of a disappointed and furious populace on the one hand and the all powerful and Government empowered banks on the other hand. It can’t be easy forecasting which camp will do the most damage if not appeased. Especially if there’s not much you can do about the situation.

And no, I don’t know how much more contempt society can swallow before it all turns very nasty.

What, you’re off to find a more logical, ethical planet for your holiday? I don’t blame you. At least you managed to catch the Eurovision Song Contest while you were here. Do you know, that used to be considered one of the most bizarre, hilarious and illogical things on the planet? Now it seems like a welcome break in an even more bizarre reality.”

Guest Blog – A Letter to Shareholders in Lloyds Banking Group plc

25th March 2015

Dear Fellow Shareholder

Corporate Jet Services Limited/Corporate Jet Realisations Limited (in Liquidation) (“CJR”)

Sycamore Limited is a small shareholder, previously in Halifax Bank of Scotland plc (“HBOS”), and now in Lloyds Banking Group plc (“Lloyds”). We urge you to join us in demanding an agenda item at the next available General Meeting to give an account of the CJR affair and to explain what the current board will now do to make good the damage to shareholders’ interests past and present which it has caused.

That damage was firstly the loss of some £150 million of shareholders’ money by what it is extremely difficult to see as other than a fraud which has never been explained; followed by a toxic culture of denial and cover up which has persisted ever since. Lloyds knows the facts but it is not telling. You may have read something about Corporate Jet Services in the press or on the internet but Lloyds has maintained a lofty silence. We have written to our Chairman, Lord Blackwell several times but he does not reply and he brushed aside a shareholder’s question at the last AGM.

If we want our bank to be soundly profitable, to deal fairly with its customers, to promote honest business practice and to pay maintainable dividends – in short to make a clean break with the past some truth and reconciliation is required. The bank must also pursue those responsible for CJR and who have benefitted from it within and beyond the Bank, for restitution of the millions they have misappropriated.

The history of CJR was short but disastrous for shareholders. In 2003 HBOS set up what was effectively a secret subsidiary company, lent it £12.8 million secured on executive jets worth about £8 million and equity capital of £2,500; and proceeded to pump money through it until it was shut down in September 2007 by PricewaterhouseCoopers as Administrative Receivers at a cost to the Bank’s shareholders of about £150million. That company was CJR and it banked with the High Risk Unit in Reading. Tellingly, the Bank paid off all third party creditors and sold the good bits of CJR to the management team for a song, presumably as a thank you for their skillful services rendered. After 2004 by which time it owed the bank
£28 million CJR produced no statutory financial statements, in blatant breach of Company Law, so there is no public record at all of where most of the money went. Lloyds will not even tell the Liquidator of CJR and has threatened us with legal action if we support him in his requirement for that information. Certainly it appears that much of the money went to the Isle of Man and some was used to fund the purchase of two luxury motor yachts. The Bank’s official line, in so far as it has one, maintained by Lloyds to this day, was that CJR was the result of some overenthusiastic lending by a manager in the High Risk Unit in Reading
and that none of the lost money is recoverable. Admittedly, HBOS probably did regard £150 million of shareholders’ money as peanuts. It raised £4billion in a rights issue shortly afterwards in 2008 and secretly borrowed £25 billion from the taxpayer to keep itself afloat. Nobody felt that needed mentioning to the shareholders of Lloyds when they voted on the merger in 2009, so why would they mention a mere £150 million?

We believe that the CJR affair goes to the heart of the HBOS and now Lloyds banking culture. You may think that you deserve an explanation. Lloyds does not. Nor does the public shareholder, UK Financial Investments, which still holds nearly 25% of Lloyds and could singlehandedly get CJR on the agenda, but has told us that the matter has nothing to do with them. Neither it seems do the authorities think that you deserve an explanation. In fact it appears that everybody involved with Lloyds has long known about CJR except the ordinary shareholders. We believe that shareholders are entitled to a full explanation, a heartfelt
apology, action to recover the money, and real cultural change.

The key questions are;
1 Where has the money gone?;
2 Who approved the CJR “lending”?;
3 Who else knew about it?;
4 Who has benefitted from that money?;
5 Will Lloyds now take disciplinary action against those directors and employees responsible for CJR and the cover up?;
6 Will Lloyds now pursue for compensation the individuals responsible, whether inside or outside the Bank, without fear or favour?

Please send an email and/or write as follows in your registered name and address as a shareholder to:
Malcolm.Wood@lloydsbanking.com
Malcolm Wood, Group Company Secretary,
Lloyds Banking Group plc
25 Gresham Street
London EC2V 7HN

I/we as a shareholder in Lloyds Banking Group plc (“LBG”) request that the following be
included as an agenda item at the next available General Meeting of the Company, being a
matter which ought to be explained in the interests of the shareholders:

“An explanation of the Company’s involvement in the affairs of Corporate Jet Realisations
Limited (in Liquidation) Company number 04521080”
I/we hold (number of shares registered in your name) shares [this is optional but preferable – see note (i) below]
Registered Name of shareholder:………………………………………..

PLEASE NOTE that according to the Company Secretary:
(i) To be accepted, the request must be submitted by members holding at least 5% of the issued share capital of Lloyds Banking Group plc or by at least 100 members holding at least 1,000 shares each (£100 worth of 10p nominal value shares).
(ii) the request must be received at least six weeks before the AGM or, if later, by the time the notice of the AGM is given.

As of 22nd March the notice of the 2015 AGM has not yet been issued. Given that the 2015 AGM is to be held on 14th May to ensure that your request is accepted for the AGM it should be submitted before 2nd April 2015.

Make your voice count. You may also like to ask your MP to raise this matter with the government and with UKFI.

So that we may check that the threshold for acceptance has been reached please email a copy of your request to:
mpage@sycamore.aero
Yours sincerely
Sycamore Limited
Michael Page
mpage@sycamore.aero