FSA Urged to Disclose Audit Reports on RBS Collapse
Despite the approval of former Royal Bank of Scotland (RBS) CEO Fred Goodwin to open the report prepared by PwC on the collapse of the bank, the Financial Services Authority (FSA) remained steadfast in its initial stance not to make the report public.
The FSA underestimated Goodwin’s consent to disclose the report amid the pressure it faces to do so, suggesting it would only open it to the public when there is valid legal foundation that would allow for the disclosure of the report. FSA, which refused to comment on Goodwin’s call, follows the provision from the Financial Services and Markets Act of 2000 that criminalizes public disclosure of confidential information.
But proponents of the motion to open the report to the public argue that disclosure of this kind of information is allowed if its aim is to permit the discharge of public function or if it is “permitted by regulations made by the Treasury under this section.”
Part also of the exemption is the existence of consent obtained from the source of the information, in this case the RBS, which the FSA received.
Chancellor George Osborne, who raised fears that FSA might issue the same objection to the disclosure of the reports into the collapse of HBOS and Bradford & Bingley, supports the call to make the PwC report public.
The House of Lord will hear the issue on the non-publication of the report tomorrow following Lord Haskel’s call to discuss the matter.
The report covered an 18-month investigation into RBS’s acquisition of ABN Amro which has resulted in the bank’s collapse. The FSA said in a statement Thursday that the bank did not make circumspect decisions prior to the financial crisis, its acquisition of the ABN Amro included, putting RBS in dire need for a £45bn bail out to be funded using the taxpayer’s money.