Financial rape of Britain’s entrepreneurs
Full-time support group formed to sue guilty bankers; 1600 active members reviewing scams and mis-selling against small businesses; customers borrowing to buy hotels a particular target; super-injunctions being thrown around like confetti; assets being repossessed after falsifying default or insolvency; Financial Ombudsman snowed under with complaints.
I’ve been reading some of the paperwork to do with the mounting number of lawsuits against RBS.By the end of the process, one is beginning to think that the RBS should stand for Rogered Bowel Syndrome. Almost all of the legalese and data relate to the two main scams unearthed so far – mis-selling rate-swaps to SME borrowers (which then bankrupt them) and fraudulently undervaluing an asset used as collateral by small business borrowers (which then renders them insolvent – and hands over the asset to the bank).
I can’t talk to you about a lot of those cases. This has nothing to do with sub judice, but everything to do with super-injunctions. These latter, as most of you know already, are standard weapons of the guilty, designed to stop news spreading of various heinous crimes ranging from paedophilia via phone hacking and celeb infidelity to serious fraud. Suffice to say that at least two of the fraud allegations brought against RBS are very serious indeed, and contain compelling evidence of organised systemic policy. Oddly enough, these tend to be the ones with super-injunctions dumped on them.
What I can write about, however, is the sheer scale of the operations. For example, ‘bully-banks.co.uk‘ is a support and action group dedicated to bringing fraudulent banking practices to justice. A substantial proportion of the cases involve RBS group banks, and those already in the b-b group think they represent only the tip of an iceberg….especially when it comes to mis-sold rate swaps.
Now hold your breath. Over 1600 people and 800 small businesses are already active within the group.
If you think you’re a victim too (or you know someone else who might be) get in touch with them.
What I can also do is tell you all about those who are bitter – but not as yet in Court having super-injunctions hurled at them by sociopathic law firms, and granted by oddly biased judges. I wrote about one such victim, Colin Jones, last week. Today I want to review the allegations of one Muhammed Aslam.
Once again (and I’d love to know why) the target is a small entrepreneur borrowing to buy hotel premises. In this case, however, there is also evidence that the bank’s plan was to establish a ‘history’ of bad debt, and then offload the risk of the debt.
In earlier years, however – under Sir Freddie Badloss – RBS was red-hot to trot as far as Mr Aslam’s business loans were concerned.
“I had a business term-loan with RBS of £450,000 for a small hotel and an overdraft of £15,000″ he says. “I took out another business term loan of £115,000 in 2005 to buy a house to let. In 2007 when I was going to leave RBS, they offered the £450,000 at 2% above base – interest only – fixed for 5 years. In 2008 they gave me another business term loan of £78,000 to purchase a takeaway.”
No offence meant at all to Muhammed, but this was not sensible business for any honest, sane bank to take on, because it stood no chance of becoming profitable for some considerable time. But a common strategy in those days was to pile daft liability onto the balance sheet….because in the bonkers world of banking, these could then be treated as assets.
Also, having got the ‘asset’ on board, teams of ‘sweaters’ would illegally charge, scam and generally cheat the asset’s owner into a position where profit could be squeezed out. As we now know, this is exactly what several major banks did.
One way in which Mr Aslam alleges RBS did so came in May of 2011 when two of his direct debits were not honoured by the bank. He was charged £70.00, the reason being ‘no funds in account’. He proved that there were, and so the bank had to back down.
Later, he discovered that his ’interest only’ loan was interest only up to but not including some capital repayments. Again, the bank backed down.
In fact, once RBS had gone mammories skywards, things became much nastier. A programme of trying to prove a history of default by Muhammed Aslam now swung into action as the bank seemingly tried to offload toxicity.
“The £78,000 loan taken out in 2008 had not had any repayments collected by the bank, and so the interest on it had been accruing since it had been taken out,” he reports. “Now it was standing at approx £86,000.00. They have not been able to tell me why this happened.”
I could offer a possible clue: perhaps RBS was trying to establish a track-record of bad debt.
On 23rd January 2012, the bank wrote telling Muhammed he had breached the terms of the loan on his Glenisla Hotel. RBS charged that he had done so by leasing out the hotel; but he is emphatic he can prove that several bank officers were aware of the fact that he had leased out the Glenisla.
Despite Aslam offering to cancel the lease, the bank’s response was to withdraw his overdraft facility. Yet despite their apparent best efforts to prove otherwise, Muhammed Aslam had never been in default with RBS at that time.
In early September 2012, the Royal Bank of Scotland froze all Mr Aslam’s accounts, without either warning or informing him. He found out on going into the branch on the 19th. Then he received this classic:
‘The interest on loan account 00244388 [the Glenisla account] in your name at Bonnyrigg branch could not be met on 27 September 2012.’
This is wonderfully Kafkaesque: you freeze somebody’s accounts for no other apparent reason beyond (again I quote) ‘they are no longer in line with bank lending policy’ – and then declare the customer a bad risk…because a frozen account can’t meet repayments on the loan you begged him to take out four years previously in order to keep the business.
Indeed, Mr Aslam’s accounts have now been transferred to the department dealing with debt recovery…another neat and nasty way of ‘framing’ the customer when things get to Court.
His £78,000 loan has now been called in (conveniently, this too has a history of ‘non-repayment’) and so Muhammed Aslam has turned to the Financial Ombudsman.
I’d love to see him get a result, but I’m not holding my breath. Meanwhile, RBS stands to reap the cost-free harvest of a hotel and a takeaway at zero cost of sales. Nice work if you can get it.
But as Boris keeps reminding us, “We really must stop knocking our bankers”.
Footnote: it strikes me that, with 80% of Rubbish Banker Sh*ts being owned by the Treasury, would it be possible to bring a case against senior officials there, and George Osborne? Any legal advice on that topic gratefully received.