Banking News RBS In 500million Tax Avoidance But Will Sir Fred Lose His Knighthood 3070

RBS in £500million tax avoidance but will Sir Fred lose his knighthood?

13 March 2009 / by Rebecca Sargent
Royal Bank of Scotland (RBS) has come under fresh scrutiny today following reports in the Guardian that the bank has been involved in tax avoidance schemes that have cost the Treasury £500million.

According to the Guardian, RBS has now disbanded the department that was responsible for the controversial measures, which involved moving sums of up to £6billion at a time and keeping them circulating between banks.

An RBS source told the Guardian: “The idea that we could take support from the Treasury with one hand and somehow pick their pocket with the other would be wrong on every level.

“We have always sought to avoid this sort of stance and that’s more important now than ever. It’s not a sustainable way to do business.”

The bank is now 70 per cent taxpayer owned following its notorious collapse, which is why new management has decided to put an end to the so-called ‘structured trades’ which took place under Sir Fred Goodwin.

Meanwhile, MPs are calling for Sir Fred’s knighthood to be stripped from him, following his refusal to give up his RBS pension which could still total £16million.

An Early Day Motion has been put in place and has so far received 37 signatures. The motion reads: “That this House expresses its indignation at the continued refusal of Sir Fred Goodwin to reduce his pension; believes that in order to preserve the integrity of the honours system his knighthood should be forfeited.”

The recent collapse of RBS, Lloyds and HBOS has led to the overall remuneration schemes of banks being scrutinised following the revelations that bonuses totalling £1billion could still be paid to RBS staff, despite their failure to keep the bank afloat.

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Written by Editorial Team