Banking Misconduct and the FCA

Debate between Jo Stevens and Martin Whitfield

Thursday 10th May 2018 Commons Chamber

[Martin Whitfield]

I am grateful to my hon. Friend for that intervention, and I would draw attention to the very basic case of those owning a business that has constantly paid back its loans on time and maintained contact with the bank, who may suddenly, through a simple slip of a pen in the valuation or revaluation of the business by part of the bank’s organisation, find themselves in breach of their loans—and they lose their business. That is not a question for the shareholders or for the directors; with a movement of a pen, their business becomes the bank’s.

RBS has been at pains to point out that the Promontory report did not find any evidence of deliberate under- valuations, but in any event the report could not in many cases find any evidence about how valuations were conducted, and there is a suggestion that they were simply made up. These valuations could then be used to appoint an insolvency practitioner, subject to huge costs, and a cosy relationship between a surveyor, an insolvency practitioner and a bank suddenly means that another family business has been lost.

[Jo Stevens (Cardiff Central) (Lab)]

My constituent Kashif Shabir, whom I have spoken about in several debates on this issue, has been the victim of exactly that, with Lloyds bank and Alder King surveyors in Bristol, resulting in the loss of his £10 million business. Does my hon. Friend agree with me that the bosses of both those organisations, Mr Horta-Osório and Mr Martyn Jones, should now proactively take steps to offer—

[Jo Stevens]

I apologise, Madam Deputy Speaker. Does my hon. Friend agree that the banks and the surveyors should proactively take steps now to offer redress to my constituent and to many other constituents of Members on both sides of the House?

[Martin Whitfield]

Absolutely. I agree with that proposal, because the banks and the surveyors have professional responsibilities to their clients and those they serve, and such responsibilities apply equally by omission as by action.

To conclude, from its early inception, banking was engineered to become a focal hub of community engagement. There was a societal bond of trust, which was represented by the strong institutions on our high streets. In recent years, however, this has become synonymous with mistrust and deceit. Consumers right across the country have been let down not just by a few specific banks, but by an industry that has developed and become polluted by a toxic culture of misconduct.