MPs are urging the proprietor of HBOS, Lloyds Banking Group, to pay compensation to victims of a fraud facilitated by two former workers, who had been jailed final week.
In addition they need assurances the financial institution will assessment its dealing with of the fraud and publish its findings.
The fraud passed off earlier than Lloyds Banking Group took possession of HBOS.
The financial institution has all the time claimed to be a sufferer of this crime.
‘Cheated, defeated and penniless’
Two corrupt workers of the financial institution imposed a agency of so-called turnaround consultants on their small enterprise clients in trade for bribes, together with money and prostitutes.
The consultants then used their relationship with the financial institution to bully the enterprise house owners into handing over extortionate charges and belongings similar to shares of their corporations.
Within the phrases of the decide they had been left “cheated, defeated and penniless”.
Former HBOS banker Lynden Scourfield was given a jail sentence of 11 years and three months, whereas guide David Mills was jailed for 15 years.
Michael Bancroft, 73, was jailed for 10 years; Mark Dobson, 56, one other former HBOS supervisor, was sentenced to 4 and a half years. The 2 had been jailed on counts together with bribery and cash laundering.
Alison Mills, 51, and John Cartwright, 72, got three and a half 12 months sentences for cash laundering.
One different defendant, Jonathan Cohen, was acquitted on the trial.
MPs on the All-Social gathering Parliamentary Group on Honest Enterprise Banking have despatched an open letter to the financial institution’s chief govt, Antonio Horta-Osorio, and its chairman, Lord Blackwell, urging the financial institution to pay correct compensation to the victims of the fraud.
Chair of the parliamentary group, George Kerevan MP, stated within the letter: “We’re at some extent the place, as soon as once more, there are a big group of aggrieved enterprise individuals who have misplaced their livelihoods.
“Critically, many have endured years of monetary duress and private stress.”
Mr Kerevan went on to say that detailed complaints of the “prison exercise had been raised with senior HBOS Administration at board stage and as early as 2007 and had been repeated to senior Lloyds administration after the takeover.
“In each cases, there was an inner failure to adequately examine these complaints.
“Additional, police investigations had been delayed as a result of each HBOS and subsequently Lloyds knowledgeable the authorities that it was the financial institution that was the wronged celebration – fairly than small enterprise clients – however that the financial institution had no want to pursue a prosecution,” he added.
It has additionally emerged, in confidential paperwork disclosed to the Sunday Instances over the weekend, that belongings of enterprise clients who had been victims of the fraud had been being held on belief for the financial institution.
The corporate holding them, referred to as Sandstone, was nominally run by the ringleader of the fraud, David Mills.
However the paperwork reveal senior financial institution employees regarded the belongings as belonging to the financial institution.
Among the victims misplaced their corporations, livelihoods and even their properties because of the rip-off.
Paul and Nikki Turner, from Cambridge, tried to report what was occurring after their publishing firm, Zenith, was run into the bottom by the scammers.
They stated they’ve needed to battle exhausting for 10 years to have the fraud recognised.
This week, the MPs on the All-Social gathering Parliamentary Group on Honest Enterprise Banking are launching an inquiry into dispute decision processes masking small companies and their lenders.
They’re giving Lloyds the chance to present proof and to participate in a pilot scheme for various dispute decision.
Lloyds Banking Group has reiterated the assertion it gave after the trial, saying “the verdicts relate to prison acts dedicated by two people inside HBOS at the side of exterior events greater than a decade in the past” and that it has assisted Thames Valley Police all through the method.
It went on to say: “While now we have totally reviewed buyer considerations raised beforehand, we’ll assessment any new considerations on a case-by-case foundation making an allowance for any related new data from the trial.
“The trial highlighted prison actions that bear no reflection on the behaviours of the overwhelming majority of the staff of HBOS on the time or within the group at present.”
The financial institution declined to touch upon the Sunday Instances article.