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To: RT Hon Dr Vince Cable MP
Public Inquiry into Darling/Brown/Blair and RBS
I wish to request a Public Inquiry to determine whether Alistair Darling MP, Gordon Brown MP and Tony Blair MP should face charges of misconduct in relation to the collapse of the Royal Bank Of Scotland and the potential loss in excess of £50 Billion of taxpayers money.
Why is this important?
The banking crisis has precipitated very substantial austerity measures across the UK that may continue for many years to come. It is unlikely that the RBS bail-out fund from UK taxpayers will ever be recouped. I believe Alistair Darling MP, Gordon Brown MP and Tony Blair MP individually, jointly or severally may be guilty of substantial lack of oversight within the financial sector and interference with the proper Regulatory Authorities. I include an article from Ian Fraser a highly respected and award winning journalist, commentator and broadcaster and author of Shredded: The rise and fall of the Royal Bank of Scotland.
Ian Fraser writes:
“However, the true villains of this piece are the politicians, central bankers, regulators and the Basel Committee on Banking Supervision. Despite his initial attempts to crack down on banker excess via the Cruickshank Report, Brown changed his tune towards banks and bankers in mid 2002. Three years later, seemingly pressurised by bankers, Tony Blair more or less demanded that the already emasculated FSA give up any pretence of trying to regulate the banking sector. From that moment on, banks thought they could get away with virtually anything, whilst defying financial gravity and existing above the law. At a domestic level, it meant morality and ethics could be thrown out the window and we saw the mis-selling of rip-off products on an epic scale – including the scandals of payment protection insurance and interest-rate swap agreements sold to small and medium-size enterprises. The Treasury, the FSA and the Bank of England all turned a deaf ear to the complaints from the banks’ millions of ‘victims’ and paid little heed to the overall balance-sheet strength – their capital, liquidity and asset quality – of banks like RBS. And, at various stages between 1988 and 2008, British politicians also outsourced critical aspects of banking regulation and supervision to the private sector body, the Basel Committee on Banking Supervision, which enabled the bankers to write their own rules. That, in itself, is an error that is easily as bad as any that were committed by Fred Goodwin. So he is right. We can’t just blame it all on him.”
“The government had an unprecedented opportunity to sort out RBS in the aftermath of its October 2008 collapse. It could have fully nationalised RBS and then split it into a ‘good bank’ and a ‘bad bank’, following the model adopted by the Swedish government for its bombed-out banking sector in 1992.That would have permitted a harsher treatment of certain categories of creditors and a much more profound restructuring than was possible under the Labour government’s half-baked bailout. There should have been a more realistic approach to the marking-down of asset valuations, greater honesty and transparency in the way the bank was run and a less vindictive approach to customers whose businesses and lives the bank had inadvertently or wrongfully destroyed.”
“In failing to consider alternative policies along these lines, the governments of both Gordon Brown and David Cameron have let the people of Britain down. The result has been that, at the time of writing, RBS may even be a worse bank than it was under Fred Goodwin and it is certainly a much worse bank than it ever was under George Mathewson and Charles Winter.”
“At the time of writing, one resuscitation programme has, except in purely quantitative terms, largely failed. The approximately £100-billion unfunded liability the bank has for litigation and redress issues remains a massive albatross around its neck. These costs relate to the following five broad areas of alleged criminality and wrongdoing at RBS which, in some cases, date from the late 1990s to the present day:
.(1) the mass ‘mis-selling’ of financial products to unsophisticated customers mainly in the US and UK;
.(2) the mis-selling of mortgaged-backed securities to sophisticated investors in the US;
.(3) the alleged collusion with other global banks in the credit default swap market in the US and Europe;
.(4) the alleged rigging of key financial market benchmarks including Libor, ISDA fix and foreign exchange benchmark rates, which is already proven in the case of Libor and related interbank borrowing rates;
.(5) the alleged duping of investors ahead of a £12.3 billion rights issue in April 2008.
Even with its estimated £250-million-a-year legal budget and truculent approach to litigation, RBS will struggle to bat off these claims.”
“If the right moves are now made, RBS could become a great bank again. If they’re not, I doubt it will even exist in ten years time. Whatever happens, the chances of British taxpayers ever seeing any return on their £45.5 billion investment are close to nil.”
Ian Fraser writes:
“However, the true villains of this piece are the politicians, central bankers, regulators and the Basel Committee on Banking Supervision. Despite his initial attempts to crack down on banker excess via the Cruickshank Report, Brown changed his tune towards banks and bankers in mid 2002. Three years later, seemingly pressurised by bankers, Tony Blair more or less demanded that the already emasculated FSA give up any pretence of trying to regulate the banking sector. From that moment on, banks thought they could get away with virtually anything, whilst defying financial gravity and existing above the law. At a domestic level, it meant morality and ethics could be thrown out the window and we saw the mis-selling of rip-off products on an epic scale – including the scandals of payment protection insurance and interest-rate swap agreements sold to small and medium-size enterprises. The Treasury, the FSA and the Bank of England all turned a deaf ear to the complaints from the banks’ millions of ‘victims’ and paid little heed to the overall balance-sheet strength – their capital, liquidity and asset quality – of banks like RBS. And, at various stages between 1988 and 2008, British politicians also outsourced critical aspects of banking regulation and supervision to the private sector body, the Basel Committee on Banking Supervision, which enabled the bankers to write their own rules. That, in itself, is an error that is easily as bad as any that were committed by Fred Goodwin. So he is right. We can’t just blame it all on him.”
“The government had an unprecedented opportunity to sort out RBS in the aftermath of its October 2008 collapse. It could have fully nationalised RBS and then split it into a ‘good bank’ and a ‘bad bank’, following the model adopted by the Swedish government for its bombed-out banking sector in 1992.That would have permitted a harsher treatment of certain categories of creditors and a much more profound restructuring than was possible under the Labour government’s half-baked bailout. There should have been a more realistic approach to the marking-down of asset valuations, greater honesty and transparency in the way the bank was run and a less vindictive approach to customers whose businesses and lives the bank had inadvertently or wrongfully destroyed.”
“In failing to consider alternative policies along these lines, the governments of both Gordon Brown and David Cameron have let the people of Britain down. The result has been that, at the time of writing, RBS may even be a worse bank than it was under Fred Goodwin and it is certainly a much worse bank than it ever was under George Mathewson and Charles Winter.”
“At the time of writing, one resuscitation programme has, except in purely quantitative terms, largely failed. The approximately £100-billion unfunded liability the bank has for litigation and redress issues remains a massive albatross around its neck. These costs relate to the following five broad areas of alleged criminality and wrongdoing at RBS which, in some cases, date from the late 1990s to the present day:
.(1) the mass ‘mis-selling’ of financial products to unsophisticated customers mainly in the US and UK;
.(2) the mis-selling of mortgaged-backed securities to sophisticated investors in the US;
.(3) the alleged collusion with other global banks in the credit default swap market in the US and Europe;
.(4) the alleged rigging of key financial market benchmarks including Libor, ISDA fix and foreign exchange benchmark rates, which is already proven in the case of Libor and related interbank borrowing rates;
.(5) the alleged duping of investors ahead of a £12.3 billion rights issue in April 2008.
Even with its estimated £250-million-a-year legal budget and truculent approach to litigation, RBS will struggle to bat off these claims.”
“If the right moves are now made, RBS could become a great bank again. If they’re not, I doubt it will even exist in ten years time. Whatever happens, the chances of British taxpayers ever seeing any return on their £45.5 billion investment are close to nil.”
