Wednesday, October 19, 2016

Did RBS Group shut down RT's bank accounts to send a message?


In October 2016 NatWest (which is a subsidiary of the majority taxpayer owned RBS Group) took the extraordinary decision to shut down the bank accounts of the Russian broadcaster RT.

In the week before the RBS Group's NatWest subsidiary took the decision to obstruct the operation of RT by scrapping their bank accounts, one of the banking group's biggest scandals was back in the news. Leaked documents showed that the bank had been systematically destroying and asset stripping thousands of British businesses for their own profit. The leaks revealed that the bank was so brazen about its GRG asset-stripping operation that they even referred to it as
 the "dash for cash" and offered cash bonuses to bank staff for identifying businesses that were ripe for asset-stripping.

Back in 2014 when the asset-stripping activities of the RBS Global Restructuring Group first came to prominence RT hosted some extraordinary criticism of the bank. In one episode of the Keiser Report the host accused the bank of being "financial terrorists" and then conducted a scathing 15 minute interview with Neil Mitchell who has been fighting for justice ever since the GRG destroyed and asset-stripped his business.

In the wake of the scandal RBS managed to deflect most of the criticism and avoided criminal investigations into their conduct by repeatedly assuring parliament, the financial regulators and the public that the Global Restructuring Group was "not a profit centre" and that they'd just been trying to help the 12,000 UK businesses that went through the process.


After the Global Restructuring Group leak in October 2016 the Keiser Report went into attack mode again pointing out that the leaked documents totally contradicted the assurances given 27 times in parliament by RBS executives that GRG was "not a profit centre". Within a week of RT running this criticism, the RBS subsidiary NatWest decided to shut down all of RT's bank accounts.

It seems extraordinarily unlikely that RBS Group decided to scrap RT's bank accounts for financial reasons. The idea that Russia would ever allow their most influential international broadcaster to get into severe financial difficulties is ludicrous. So if the decision wasn't made for economic reasons, it seems likely it was made for political reasons.
When the news broke speculation abounded that the decision was part of a government strategy of toughening relations with Putin's Russia, but the UK Treasury (which owns a 73% stake in RBS Group) quickly denied responsibility for the decision to obstruct the operation of RT, which, if true, means the decision was entirely in the hands of RBS Group executives.

This is bad for two reasons. The first and most obvious reason is that the decision to shut down the bank accounts of a broadcaster that has been highly critical of their banking group sends a chilling message to the rest of the media: "If you dare to criticise the big banks we can make life very very difficult for you". Even if RBS Group tries to claim* that the decision to scrap RTs banking facilities has nothing to do with RT's strong criticism of the RBS Group and their GRG asset-stripping operation, the message to the rest of the media is still loud and clear.

The second reason this is bad is that the UK Treasury is claiming that it didn't have any say over a decision taken by a bank that is still 73% owned by the taxpayer, despite the obvious political and diplomatic ramifications. The fact that RBS Group could make a decision like this without any form of consultation with the government, despite the fact they're 73% owned by the taxpayer, is yet more proof that the nationalisation of RBS was a catastrophic mistake. Not only did a taxpayer owned bank apparently go around asset-stripping some 12,000 British businesses to boost their own profits, they've now taken to making decisions with major political and diplomatic ramifications without the slightest effort to consult the government.


Maybe the RBS decision to provoke Russia into taking tit-for-tat action against British broadcasters suits maniacs like the Tory MP Andrew Mitchell who wants to trigger World War III by shooting down Russian jets over Syria. But anyone with any sense should know that enraging the Russian bear is a daft idea at the beat of times, but when you've just spent the last six years savagely cutting your conventional military capabilities and you're in the midst of an enormous self-inflicted diplomatic and economic crisis, it's staggeringly idiotic.

The British taxpayer has lost £billions on the RBS "investment", and what is worse is that all of that money was poured into the bank with no strings attached, meaning the very same executives who wrecked the bank in the first place were completely free to carry on inflicting even more carnage on the UK economy and the rest of the world by asset-stripping thousands of British businesses, rigging the Libor rate, rigging currency markets, financing the manufacture of cluster bombs, sanction-busting, misselling complex financial products to members of the publicmoney laundering, committing fraud against their own customers, tax-dodging and now provoking a major diplomatic incident by shutting down the banking facilities of a critical media organisation without even bothering to check with the government first.


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* = Who on earth would be gullible enough to believe the claims of RBS executives after they repeatedly lied to parliament about the GRG not being a profit centre?

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