SMEs mount legal challenge against Clydesdale Bank over tailored business loans

RGL Management Ltd (RGL) believes that in excess of 6,000 SMEs have legitimate grounds to join this action. Many SMEs that took out TBLs later lost their businesses to insolvency “as a result of the fraudulent behaviour of the bank,” it said.

RGL specialises in large complex group representative actions against banks, typically on behalf of SME claimants, and is regulated by the Claims Management Regulator in respect of regulated claims management activities.

The company has received funding from Augusta Ventures Limited to prosecute this litigation. Augusta is one of the largest litigation funders in the UK. RGL expects to issue claims this year, with precise timing dependent on tactical considerations, meaning that it could happen very quickly leaving those SMEs that have valid claims with little or no time to join, if they have not already done so.

James Hayward, CEO of RGL said: “Clydesdale’s conduct is actionable and we’ll be suing those involved in order to recover damages for those customers it harmed.

“Proceedings will probably be issued later this year, however the exact timing is difficult to predict and will depend primarily on what gives us the greatest tactical advantage. Anyone wishing to join the action should get on board quickly or risk being left out.”

A CYBG spokesperson said: “Whilst we have seen reports of a potential claim being considered in relation to Tailored Business Loans, we have not received any such claim to date from RGL Management Ltd and it is therefore not possible to comment on speculation around any potential case or the basis for any claim.

“In relation to Tailored Business Loans, this is a long-standing historical matter which has been subject to significant scrutiny and which the bank has been working through with customers as part of a wide-ranging remediation programme, in an open and transparent manner.

“We have made significant progress in resolving the vast majority of cases. Where we have reached a final agreement with customers, the cost of this has been covered by existing provisions as extensively disclosed in our financial reports.”