There is a sense of inevitability as bank after bank is (still) taken to task, as their greed and thirst for money renders common sense and integrity as impotent bystanders.
The latest revelations about the majority taxpayer-owned Royal Bank of Scotland (RBS), and its treatment of small business customers, are shocking. They reveal this was a conniving, scurrilous juggernaut, out of control and targeting vulnerable small businesses in what was referred to as "Project Dash for Cash".
If ever there was a title that was as unbecoming as its intentions, this was it. This lack of imagination is matched only by the inherent lack of honour displayed by those who sought to prey upon their victims.
I deliberately use the word "victims", as this sums up those targeted in such a manner. Small businesses are the life-blood of local communities, providing work for the local populace and thereby generating a homegrown economy that sustains neighbourhoods.
Those running these small businesses are often stressed and burdened with worry, trying to make ends meet and maintain cash flows in an effort to remain solvent. The last thing any of these entrepreneurs needs is to be sucked dry by a manipulative financial institution that shows no care or regard for its small business customers.
The immorality displayed has been shocking: forcing small businesses into the clutches of RBS's so-called "Global Restructuring Group" (GRG) purely with an eye to charging extortionate interest rates – it's alleged this was used to eventually acquire their assets on the cheap, when they were no longer able to make their loan payments.
As a lawyer who runs a boutique highly-specialised law firm, specialising in the investigation of international fraud and asset recovery, I know better than most the headaches associated with running a business. To compound matters, by becoming embroiled through no fault of your own with the dreaded GRG, would likely see many directors add exponentially to their sleepless nights.
So what is to be done? Is this a money-making scheme or a money-making scam? The UK's Fraud Act 2006 opens up some interesting possibilities. For instance, if RBS knowingly and deliberately manoeuvred small businesses into the clutches of its GRG, purely and simply to maximise profits, would this be considered dishonest? If so, could this fall into Section 2 of the Act?
Section 2 of the act states that it would apply if the defendant:
(a) Made a false representation – we know that there are developing allegations that many of the businesses affected hadn't even been in default of their original loan, and failed to understand why they were being targeted;
(b) Acted dishonestly – we also know that there are developing rumours that directors consider themselves to have been misled by RBS's purported rationale;
(c) That knowing that the representation was or might be untrue or misleading – self-explanatory with (a) and (b) providing the potential foundation for the assertion;
And finally (d) With intent to make a gain for himself or another, to cause loss to another or risk of loss. This best sums up to my mind the alleged intentions of the RBS/GRG teams to maximise profits improperly.
Of course, I feel its prudent to mention, that at the time of writing there is no clear indication nor evidence that all the Fraud Act criteria are met.
However, one would assume that these issues will be investigated, and if the offence is complete, then consideration will be given to prosecuting those responsible. It may also come to pass that there are grounds for the businesses affected to sue the RBS/GRG for any losses or damages caused.
Martin Kenney is managing partner of Martin Kenney & Co. Solicitors, a specialist investigative and asset recovery practice based in the British Virgin Islands. Kenney focuses on multi-jurisdictional fraud and grand corruption cases.