RUTH SUNDERLAND: Hold NatWest to account

RUTH SUNDERLAND: Hold NatWest to account

  • Review into issue of ‘debanking’ at Coutts landing anytime now with board
  • It is not likely to placate Nigel Farage or anyone else 
  • Part of a depressing history of supposedly independent probes into bank failings

The review into the Nigel Farage debacle and the wider issue of ‘debanking’ at Coutts, the posh bit of NatWest, is landing anytime now with the bank’s board.

This piece of work, commissioned by NatWest at the end of July from law firm Travers Smith, is not likely to placate Mr Farage or anyone else.

Nothing is likely to be published before the end of October. The board, led by chairman Sir Howard Davies, who has himself emerged tarnished from the affair, will take several weeks to digest the findings.

The intention is merely to release the key findings, along with recommendations and disciplinary actions the bank plans to take – and is obliged by regulations to reveal.

It will disclose any pay and bonus clawbacks for Dame Alison Rose, who is being paid a package of £2.4m under her contract, alongside the Travers Smith report, as it must do so under stock market rules.

A sign of the times: The review into the Nigel Farage debacle and the wider issue of 'debanking' was commissioned by NatWest at the end of July

A sign of the times: The review into the Nigel Farage debacle and the wider issue of ‘debanking’ was commissioned by NatWest at the end of July

However, there is no such requirement to reveal if Peter Flavel, the former CEO of Coutts, thought to have earned between £1.5m and £2m a year, is also being hit by retribution in the pocket.

We won’t know anything until the Coutts annual report next year and that document is unlikely to give a full picture.

Leaving aside Farage’s dismissal of the Travers Smith review as a whitewash by an establishment law firm, it is undeniably limited in its scope. The review is not, for instance, examining the chaotic nature of Rose’s resignation, where Davies at first supported her and then backtracked after a late-night intervention by the Treasury.

Nor is it looking at how Davies, who steps down in the spring, handled the affair.

It is part of a long and depressing history of supposedly independent investigations into the failings of our banks. Almost without exception, these turn out to be a huge expenditure of time and money that result in no one being held to account.

Possibly the most egregious example is the probe into the managers at HBOS who were in charge when it went to the brink.

An inquiry that had cost City regulators £7.2m wound up last summer, 14 years after the event. It resulted in no action.

Similarly, an investigation by the Financial Conduct Authority into the scandal at NatWest’s former unit GRG, which was supposed to nurture troubled small and medium businesses back to health, decided in 2019 not to punish the bank. This was despite evidence of widespread mistreatment of customers after the 2008 crisis. The identities of managers accused of being responsible were kept under wraps.

Investigations can be hamstrung by ‘Maxwellisation’, which is named after the late tycoon Robert Maxwell, and gives people the right to respond to criticisms.

In the case of investigations into HBOS this resulted in 1425 representations from 35 people, which were followed by re-Maxwellising.

A new variant appears to be a reluctance to publish adverse findings against named individuals due to claims this may breach privacy or data protection laws.

Be that as it may, it can look as though the system is geared to the interests of bosses protecting themselves, as well as shielding firms and regulators from lawsuits.

That mentality was in evidence when the Bank of England argued individuals should not be named in a report into the £236m collapse of London Capital and Finance, which criticised governor Andrew Bailey.

The taxpaying public, which has supported NatWest for so long in the face of so many disasters, deserves better.