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Frank Hovis

Rbs - From Mugs To Muggers

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RBS taking their money back at short notice meaning cos. can't pay tax bills so go under. I've seen some very sharp business practice in my time so can well believe that they know exactly what they're doing.

RBS employed a 'hit squad' that diverted tax payments from small businesses into the bank's own coffers, it has been claimed.

In a setup that deprived the Exchequer of millions of pounds of revenues, struggling firms saw their loans called in by the group's problem lending division.

In one instance, the bank - which is 82per cent owned by the taxpayer - told business owners it was 'not interested in what is owed to HMRC', and demanded repayment.

In some cases, this pushed otherwise solvent companies into administration.

Cambridgeshire hotel owners Paul and Lucy Smith said they were not allowed to pay tax on the sale of one of their hotels.

They now face a huge tax bill after the bank, which told them it was 'not interested' in their bill to HMRC, took all of their funds for the repayment of a loan, according to the couple.

Another couple, Mike and Diane Hockin, said funds earmarked for VAT payments from their profitable property business were taken by RBS, plunging their business into administration and leaving them facing a fight with the taxman.

Oh no, not us say RBS:

A spokesman for RBS said: 'When companies reach a very high level of distress, with insufficient funds to cover all their payments, we will help them manage their difficult cash flow problems.

'We try to ensure that essential costs, such as wages and fuel bills are met which enables the company to continue operating, and slowly bring down the level of debt with their creditors.

'It is the customer's role to direct us over which payments they would like to make.'

http://www.dailymail.co.uk/news/article-2516607/Bank-took-cash-meant-taxman-RBS-accused-using-hit-squad-funnel-payments-small-firms-coffers.html

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if you owe money to the banksters or the government and can't pay it how can that make you an " otherwise solvent companies into administration." ?

Edited by TheCountOfNowhere

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I don't understand the article. They wanted the bank to pay their tax?

They want the tax man to be paid first then the banks are owed the money ( and indirectly the government ! ) and somehow they are saying that if the companies owe the banks the money they would be solvent. If the banks call in a debt and you can't pay, then you are insolvent.

If the banks can't call in a debt and can't pay their creditors then they are insolvent.

It makes no sense.

You can't have your cake and eat it as they used to say before Gordon brown become chancellor.

Edited by TheCountOfNowhere

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The reason in many cases that the businesses were insolvent - unable to pay their debts as they fell due - was that RBS had already taken an outrageous chunk through non-symmetrical interest rate swaps.

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They want the tax man to be paid first then the banks are owed the money ( and indirectly the government ! ) and somehow they are saying that if the companies owe the banks the money they would be solvent. If the banks call in a debt and you can't pay, then you are insolvent.

If the banks can't call in a debt and can't pay their creditors then they are insolvent.

It makes no sense.

You can't have your cake and eat it as they used to say before Gordon brown become chancellor.

Yes but insolvent banks can have their cake and eat it. They get given free money by the taxpayer so heads they win, tails you lose. Insolvency is only for the little people, doncha know!

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The reason in many cases that the businesses were insolvent - unable to pay their debts as they fell due - was that RBS had already taken an outrageous chunk through non-symmetrical interest rate swaps.

....or the companies borrowed too much and couldn't pay their debts.

The UK is a mess because everyone wants something for nothing and no one wants to take responsibility for their own actions.

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....or the companies borrowed too much and couldn't pay their debts.

The UK is a mess because everyone wants something for nothing and no one wants to take responsibility for their own actions.

Indeed. It seems to me that actually the RBS is doing it's job and due-diligence to close the crap business, which will hit the wall sooner or later anyway.

It seems that all UK banks now believe that there will be stagnation or drop in the property prices and they are trying to eliminate the weak businesses with too much leverage in the property. Looks like lessons learned from 2007 to me ...

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....or the companies borrowed too much and couldn't pay their debts.

Arguably not where an interest rate swap was involved. Without the swap the business would have remained profitable even, although highly leveraged.

RBS have already raised their hands on lots of these deals by formally classifying the relevant businesses as unsophisticated. It's an admission of predatory lending and the consequences are going to be very expensive.

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Arguably not where an interest rate swap was involved. Without the swap the business would have remained profitable even, although highly leveraged.

You are contradicting yourself there, or perhaps you are Gordon Brown....the leverage is the problem, not the solution, the more levered the more risk. Some companies gambled and lost and are now, as is the current fashion, look to me now like they are screaming like a piggies and demanding a bailout.

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