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OFT fines RBS £28.6m

The Office of Fair Trading has fined Royal Bank of Scotland £28.59m after it engaged in anti-competitive practices with Barclays.

A statement from the OFT says the fine is in relation to the pricing of loan products to large professional services firms.

It says Barclays blew the whistle on the practices, which is why it opted not to fine the firm under its “leniency policy”.

Between October 2007 and February or March of 2008 individuals in RBS’s professional practices coverage team disclosed generic as well as specific confidential and commercially sensitive future pricing information to their counterparts at Barclays, it says.

OFT senior director of cartels and criminal enforcement Ali Nikpay says: “The disclosure of confidential future pricing information to competitors is unlawful.

“This decision sends out a strong message that such practices, even where they arise in the context of informal contacts between competitors, can result in substantial penalties for the companies involved. It is therefore important that companies take steps to ensure an effective compliance culture that is understood by individuals throughout their organisation.”

The OFT says a full decision on the case is expected to be published on its website later this year following the redaction of commercially sensitive information.

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Comments

There are 15 comments at the moment, we would love to hear your opinion too.

  1. So a bank that is mainly state-owned gets fine 28.6 million the stitching up clients and running a cartel but an organisation that deliberately mis-sold products is only fined 7.7 million.

    Doesn’t make sense to me particularly when it is the taxpayer that will end up footing the £28.6 million bill one way or another.

    Again I want to know where the personal fines and prison sentences of the people that deliberately broke the rules. I suspect they’ll be allowed carry on trading or move on to another organisation with no penalties.

  2. Is this then not a breach of FSA principle regarding Integrety?
    I assume that this was logged and reported to the FSA? I don’t remeber seeing any FSA decision notices about this

  3. Interesting! So it’s all right to “blow the whistle” on another organsation, because they were “overcharging them” Maybe individual customers who are also being overcharged or economically advised should also blow the whistle. Goose and Gander and all that !

  4. What a brilliant system, find a crooked partner, make a fortune ripping someone off illegally, then stich your crooked partner up to the authorities and you get let off ! Brilliant, what a deterrent !!!

  5. The more they say they are changing the more they remain the same.

    Break the rules make plenty of money – get caught/fess up – pay a nominal find.

    Find another bunch of saps the regulators are not watching.

    Wash – spin – repeat the cycle.

  6. This is not a level laying field.

    It appears that the Banks are able to hide behind corporate anonymity, whereas IFA principals are targetted personally.

    That’s not to say that they shouldn’t be – but where are the individuals that are responsible for running a cartel and mis-selling £692m of investments within Barclays?

    Answers please……

  7. Dont worry, as they will not loose their licence to advise…………..like any normal small business.

    Said it once and will say it again. Banks should not be allowed to advise on any product other than what bank account would you like.

  8. Don’t you just love Barclays

  9. Overwhelming evidence, both factual and recent and on our doorstep, supports your comment @ 2.26 anonymous. I’ve said before, it could all be made so simple but heh, there’s a little more at stake here to go down that route!
    Instead of fines for the Banks, how about suspensions on trade until “professionalism” is proven and monitored independently, maybe by IFA’s?

  10. All this taking place while the regulator was at lunch, why was the come late Johnnies at the FSA not involved? or have I just answered my own question.

    Was it sadly Parliaments intention to exempt the FSA for Competition Law But then if ther FSA had been involved £28.6m would have been a nice little offset against FSA Fees.

    Equaly there appears no logic in damaging competition and letting Barclays of the hook.

    Perhaps Barclays suggested moving its offices to Brussels, Paris or Bonn

  11. Same as Virgin and BA with ticketing prices some years ago. Nothing new, just recycled idea. Barclays obviously got in first knowing they were under the cosh for bad advice with AVIVA. They say there is honour amongst thieves, but sounds like Barclays are dangerous people to have as partners for anything.

  12. When will this ever stop? My biggest concern is the damage this does to the industry in general. We are all being tarred with the same brush. However, it’s about time the banks were sorted and it doesn’t matter by who?

  13. Excellent. Another nail in the RBS coffin. Another reason to break it up. I assume that RBS and Barclays will now be part refunding the cients they overcharged ? Er , No of course.

  14. Fine a few banks a few quid relative to our fines just to keep the crowd quiet before the treasury and MPs look at the RDR.

    You fool no-one

  15. Just because the OFT let off Barclays doesn’t mean that the FSA has to let them off.

    Heads should be rolling over this at both banks. It’s an absolute scandal that people who are self-evidently not fit and proper should remain in post.

    And how high up in the banks did this go?

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