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MSP asks police to investigate RBS

26 January 2009

More voices have been raised questioning whether investors were misled over last year's £12 billion share issue by the Royal Bank of Scotland’s  last year.

The rights issue offered shareholders 11 new shares for every 18 held at 200p each. At the time the shares were quoted at around 349p each. Following the government bailout of the banks and the announcement of a UK record loss of up to £28bn for 2008, the shares are currently trading at around 12p.

SNP MSP Christine Graham has written to Lothian and Borders Police and the Lord Advocate raising her concerns. Mrs Grahame said the state of RBS’s finances should have been made clear last April when shares were sold to make money. She has the backing of First Minister Alex Salmond, the Liberal Democrat leader Tavish Scott and the unions.

Mr Scott said he wanted the Serious Fraud Office to investigate whether RBS had given investors the full picture of its financial state when it asked for extra money.

The First Minister Alex Salmond said he would like to see a parliamentary inquiry into the entire banking industry. Any investigation should include the regulators and the Financial Services Authority to ask why they were “asleep on the job”.

Former Deputy Prime Minister John Prescott has called for Sir Fred Goodwin, then chief executive of RBS, to be stripped of the knighthood conferred for services to banking.


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