Staff at the RBS overseas mortgage department are under scrutiny after it is alleged that individuals had been receiving bonus kickbacks from real estate agents worth tens of thousands of pounds in return for referring customers. The alleged bad practices are suspected to have continued to take place since the taxpayer-funded bail-out of the bank last year.
Financial experts believe that the deal is likely to include mortgages for Spanish properties sold by RBS. Therefore, the taxpayer is likely to become responsible for the questionable loans arranged by the department at the centre of the fraud investigation.
The two executives involved in the bank’s inquiry are Alan Dawson and Simon Clark.
Mr Dawson was responsible for Spanish mortgage lending to RBS customers in north-west England and Mr Clark dealt with customers in the Midlands.
The bankers would arrange mortgages for those interested in buying homes on the Continent. The two executives would also allegedly offer to put customers in touch with a “trusted” overseas property agents who would help them find a villa, apartment or any other type of property.
The money was allegedly to be paid to the bankers’ wives or other friends with “property” businesses. In some cases, cash is alleged to have been paid directly.
The money allegedly being sought by the two bankers potentially runs into tens of thousands of Euros as commissions from property sales abroad are much higher than in Britain.
The allegations are embarrassing for RBS, which was saved from collapse last October by an emergency injection of £20 billion from the Treasury. The taxpayer now owns 70 per cent of RBS. The Treasury has been in detailed negotiations with the bank for the past six months about extending taxpayer support by underwriting RBS’s toxic assets.
© Housing Market News by The Little House Company
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