Draft Amendments of the Law (Resolution of Silicon Valley Bank UK Limited) (No. 2) Order 2023

Khalid Mahmood Excerpts

Wednesday 7th June 2023 General Committees

[Mr Khalid Mahmood (Birmingham, Perry Barr) (Lab)]

It is always a pleasure to serve under your stewardship, Ms McVey.

I agree with my hon. Friend the Member for Hampstead and Kilburn that we should not contest the order, but I want the Minister to note a couple of things. The continual failure of banks hurts growing businesses that it is important we support. Will the Minister look to strengthen the PRA to ensure that there is sufficient depth to scrutinise banks and their savings? Will he look into the idea of a national development bank to help businesses and small start-ups to succeed?

Economic Update

Khalid Mahmood Excerpts

Monday 17th October 2022 Commons Chamber

[Jeremy Hunt]

I have regular contact and will continue to have regular contact—[Interruption.] Excuse me, would you let me answer? Sorry, Madam Deputy Speaker, but I was hoping the hon. Gentleman would let me answer.

I have regular contact with my Finance Minister counterparts in the devolved nations—and, indeed, the Chief Secretary to the Treasury had such discussions today—but this economic council is something different. This is about trying to make sure that we deal effectively with the instability we have seen in the markets, which is mainly London-based, and we want to make sure that it does not happen again, so I think I have four fantastic people for that role.

[Mr Khalid Mahmood (Birmingham, Perry Barr) (Lab)]

My constituents in Birmingham, Perry Barr and the people of the west midlands, who work tirelessly to be able to secure homes for their families, now look on in disbelief as they are having to focus on soaring energy bills in addition to crippling mortgage interest rates. Can the Chancellor explain how he will ensure that my constituents will not lose all they have worked for and will not need to make a choice between heating, eating or keeping their homes?

[Jeremy Hunt]

We are taking difficult decisions, and we will do whatever it takes to restore economic stability. That is the biggest single thing we can do.

Business Banking Fraud

Khalid Mahmood Excerpts

Tuesday 9th October 2018 Westminster Hall

[Mr Khalid Mahmood (Birmingham, Perry Barr) (Lab)]

It is always a pleasure to serve under your stewardship, Mr Robertson. I thank the hon. Member for Hazel Grove (Mr Wragg) for raising this issue, which is very important, particularly for our small and medium-sized enterprises, which work extremely hard to build their businesses, and which want to move forward and contribute to their local communities, employing people in the process.

One of my constituency cases is to do with HSBC. The director of a company that was not failing—it had a huge number of assets—was asked to sign over to a new loan agreement, but he was attending his dad’s funeral in India so the agreement was signed on his behalf by someone in the bank. Someone faked his signature on the document. On his return, he was told he had no choice but to proceed. The loan was offered to the company without its asking for it, to invest further in the capital assets into which it wanted to expand its business. It was forced into the position of having an additional loan and, because of the terms and conditions of that loan, the company was offered restructuring. So a company that was fluid in its assets and able to function normally was forced into restructuring. The personnel initially involved in the restructuring—those who were forcing the company into that corner—then turned into the recovery personnel, so there were people in the bank with the dual role of restructuring and recovery.

The company has fought the case for more than 10 years. It has fought extremely hard, despite the main director having lost his father and the huge stress caused throughout the family. There has been continuous suffering. The company was bound into a non-disclosure agreement and was stuck for many years. Through a lot of hard work and pain, with my office and one of my senior advisers dealing with the case, we have managed at least to get to the stage where the NDA has been removed. Yet the company cannot get any recourse for the losses incurred, let alone the initial debt problems that the bank caused, which put the company in such a predicament. Those are the problems we have; that is what these banks do.

There are two of my constituents in that position with HSBC, and two in that position with Lloyds. Both banks operate in exactly the same way. Another constituent who is involved with Lloyds bank had the bank decide to call in the receivers on a Friday at 5 pm, so it was not possible to have recourse through lawyers or anyone else to stop the injunction. That was someone rich in assets being closed down and locked into this process. The modus operandi of these banks is clear. All four of my constituents who have been dealt with in this way were fluid in their asset base—they were not struggling for money—yet, at the moment, one of them is unable to go to another high street bank because of what the people in HSBC have put them through. That is where the real issues are.

I have another constituent, Mr Elliott, who is here today. He has a significant number of companies that are doing well. He fought his case and managed to get to the court stage. Two weeks before the trial, he got an order from Lloyds saying that it would sue him for £1 million a day for every day the trial took place. Having taken that huge step, it was fundamentally difficult to tolerate that sort of pressure.

The individuals involved must be held criminally responsible for their actions. It is high time that the Government took charge and that all such businesses, which bring huge benefits to our local communities, were protected from the sharks and the way in which they operate.

--- Later in debate ---

[Mr Khalid Mahmood]

The point is not whether the funds can be squeezed out of current budgets—police budgets are under huge stress at the moment. This is not a one-off; it is a long-standing issue about criminal activity by the banks, and resources need to be available to deal specifically with it.

[John Glen]

I am grateful for the hon. Gentleman’s intervention, and I listened to his earlier remarks. I think that this is about co-ordination and the appropriate configuration of resources.