(Source: Daily Mail)
By Alex Brummer, Daily Mail, London
Dec. 16--It has taken a titanic effort but finally the British public are going to be
allowed sight of part of the report which exonerated the Royal Bank of
Scotland and its chief executive Sir Fred Goodwin from any wrongdoing.
Even better we can be assured that the events which led to the implosion
of Halifax Bank of Scotland and are now being investigated by accountants
Deloitte will also be published.
The Financial Services Authority's reasons for resisting release of the
RBS report -- which we will now see parts of in March -- was that it would
breach the confidentiality of the individuals cited and cleared in the study.
It is true, as Business Secretary Vince Cable told the Mail yesterday,
that there are "defects" in the legislation that established the FSA which
made release difficult. But we now know it was not impossible.
It took the collective efforts of the Business Secretary, the Treasury
(acting behind the scenes) and the Treasury Select Committee to get the FSA to
go public. It is significant the announcement that a substantial report (it is
expected to be at least 100 pages) came from FSA chairman Lord Turner only
after he and the FSA's chief executive Hector Sants had met with Cable late
yesterday.
The FSA argues that the timetable of its response to the
PricewaterhouseCoopers report had been inadvertently speeded up by a leak from
RBS sources anxious to point out the bank had been cleared. If that was the
case then RBS's controlled leak was badly misjudged.
Instead of a short statement the public will now have access to the inner
sanctums of the bank's thinking at the time of the disastrous ABN Amro deal in
the autumn of 2007. Its findings on the conduct of that deal may well provide
fodder for American litigants who are still smarting over what they regarded
as a misleading prospectus at the time of the UKpound12bn rights issue in the
spring of 2008.
The good news is that the kind of closed-door inquiry conducted into RBS
ought to become a thing of the past.
The Government believes the FSA and its successor in financial
regulation, the Prudential Regulatory Authority (part of the Bank of England)
should have powers to publish findings.
These will be similar to those already enjoyed by the Department of
Business (or the old DTI) which allowed publication of reports into
high-profile scandals such as Guinness and Maxwell -- albeit many years after
the event.
The importance of such probes is that the public can directly see what
went wrong and Parliament can act to close legislative loopholes.