Reportercast September 2023 with Steve Middleton: on the Ulster Bank scandal

Steve Middleton is a financial adviser specialised in regulation and he has taken up the cause of Northern Irish business owners who accuse Ulster Bank (a subsidiary of NatWest group) of fraud.

The allegations are only now coming to the fore but the issues date from the years around the great financial crisis of 2008 when Ulster Bank was part of the then-Royal Bank of Scotland Group, the bailed-out lender that famously was at the centre of the financial crisis in Europe and required billions in state bailouts.

The bank, now known as NatWest following a rebrand in the wake of multiple scandals, has previously had to pay compensation for abusing business customers whom it fleeced in a desperate bid to patch up its balance sheet, while it was being taken over by the state. This became known as the “dash for cash” scandal and it was widely covered in the media. For a flavour of the madness of things at the time and some useful background, you may visit BuzzFeed News here, in this reporter’s opinion one of the best examples of journalism on this topic.

In short, the bank would force viable business borrowers into its notorious Global Restructuring Group (GRG) which would then execute the loans early and often carry out egregious bankruptcy procedures, leaving the clients in tatters.

Today, it is alleged — and to be sure, NatWest denies (with nuance) — that the same GRG scandal also hit Northern Irish businesses under the tutelage of Ulster Bank. The regulator (Financial Conduct Authority) has yet to issue a clear view but said it is looking into the matter.

James Hurley of the Times has covered the latest here, here and here.

NatWest reportedly admitted to some “poorly drafted” contracts but strongly denies allegations of criminality — however, Steve Middleton, on the podcast, explains how this denial may pave the way for the bank to later admit “miss-selling” of the type that has happened in the past, namely attaching improper derivatives contracts, which harmed the financial standing of its clients, to commercial loans, in order to greatly expand its profits and its control over the debt issued to small businesses.

As the story continues to develop Steve delves into all of that in detail on the podcast, which is embedded below in video and audio, and also available from all major platforms — Amazon Music, Spotify, Apple Podcasts, Google Podcasts, and Youtube. Alternatively, you may listen directly from Acast, as well as use the RSS feed code to add the stream to your preferred podcast app.

The recording was made on September 13.