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![A sign belonging to a branch of the Royal Bank of Scotland is seen in the City of London January 19, 2009.[Xinhua]](http://images.china.cn/attachement/jpg/site1007/20090323/0011111fa1560b3135ba06.jpg "A sign belonging to a branch of the Royal Bank of Scotland is seen in the City of London January 19, 2009.[Xinhua]")
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A sign belonging to a branch of the Royal Bank of Scotland is seen in the City of London January 19, 2009.[Xinhua] |
The scandal-ridden Royal Bank of Scotland (RBS) was pushed under spotlights Sunday by allegations that at least three of its former non-executive directors may have been intimidated and threatened with dismissal for asking searching questions about its financial affairs.
Lord Foulkes of Cumnock, former parliament member who has been extensively briefed by former bank insiders, has written to the Financial Services Authority (FSA), the city watchdog, asking it to pursue the claims.
The allegations, if true, could trigger a criminal investigation, Observer magazine reported.
The intervention by Foulkes, who is also a member of the Scottish parliament and sits on the Commons security and intelligence committee, comes amid fears that the bank will be exposed as the UK's equivalent of Enron -- the U.S. trader that collapsed amid systemic fraud.
Foulkes said earlier there was "widespread public anger among the public and Parliament that bankers in the midst of this financial crisis appear to be profiting and no action is being taken in relation to action which could constitute criminal offences."
"If it were to transpire that executives were pressured in such a way, then that is a most serious matter indeed that needs urgent action," he added, referring to the claims of intimidation.
Claims that the bank had misled investors over its exposure to bad debts seemed another major concern for Foulkes.
More than 30 billion pounds (about 43.2 billion U.S. dollars) of "toxic" sub-prime mortgages were reported to have been bought for RBS by traders in 2007 without the board being informed -- a claim denied by the bank.
In a letter to FSA chairman Lord Turner, Foulkes asked him to address "whether any knowingly false statements were made or prospectuses issued that could have led potential investors or depositors to believe the position was more favorable than the board knew it to be and whether there was any intimidation of non-executive directors who had been asking probing questions which led them to believe they would not be reappointed if they continue asking such questions."
Last month, Prime Minister Gordon Brown made a personal demand that the bank's former chief executive Fred Goodwin hand back some of his 16 million pounds (23 million dollars) pension and pledged to take "all the legal action necessary" if he did not comply.
The bank's financial reports revealed that the former non-executives, which includes Peter Sutherland, chairman of UK oil giant BP, Jim Currie, former head of Customs and Excise and Steve Robson, a former adviser to the Treasury, were paid a basic fee of 72,500 pounds (104,500 dollars) a year.
The money was paid by the bank for "the integrity of financial information and that financial controls and systems of risk management are robust and defensible."
Concerns that the bank's non-executives failed to hold the board to account are bound to throw up further questions about how RBS was being run as it transformed itself from a relatively small outfit into one of the world's largest financial institutions.
Last month RBS recorded a loss of 28 billion pounds (40 billion dollars), the largest in UK corporate history. Its catastrophic collapse has forced the government to take a 75 percent stake in the bank.
(Xinhua News Agency March 23, 2009)
