Bosses at Royal Bank of Scotland should be summoned to parliament to explain revelations the bank crushed thousands of businesses for profit during the financial crisis, MPs have said.
A joint investigation by BuzzFeed News and BBC Newsnight revealed on Monday that RBS's business-restructuring unit, Global Restructuring Group (GRG), drained businesses of cash and stripped their assets to boost revenues during the recession.
RBS has repeatedly denied allegations that it destroyed healthy businesses for profit.
Politicians from across the UK political spectrum have reacted with fury to the leaked documents, with one Labour MP condemning the actions of RBS as "the single biggest scandal since the 2008 crisis".
It will add further pressure on the Financial Conduct Authority (FCA) to conclude its long-delayed inquiry into the bank's treatment of its small-business customers.
The Liberal Democrats have called on RBS chiefs to be "hauled over the coals" at parliament to explain why they denied the allegations in front of a Westminster committee in 2014, and to begin the process of compensating those whose livelihoods were destroyed.
The Lib Dem's economic spokesperson, Susan Kramer, said: “These damning revelations confirm what we already suspected; that RBS intentionally drove small businesses into bankruptcy."
Kramer continued: “This type of greedy, destructive behaviour has no place in a modern economy. The Financial Conduct Authority must act now to ensure those whose livelihoods were ruined are given the compensation they deserve.
"RBS bosses must come clean about what happened under their watch, including why these allegations were denied before parliament in 2014. The banks will never regain public trust unless they own up to bad conduct rather than waiting to be found out.”
Labour MP Jonathon Reynolds, the shadow city minister, said the "shocking" revelations" were a "damning indictment" of RBS's behaviour during the financial crisis.
“RBS managers are alleged to have created misery for thousands of small business owners and staff, then repeatedly misled the public and the Treasury select committee about their actions, even as they were driving small businesses into the wall," said Reynolds.
“The Financial Conduct Authority’s investigation should be published as soon as possible and, if laws have been broken, individuals must be held responsible. Britain’s small businesses should never again be treated as cash cows by a bank."
Labour MP John Mann added: "This is the biggest single scandal since the 2008 crisis. RBS executives will have to be called back to the committee to account for themselves and heads will have to roll.”
A Downing Street spokesperson told BuzzFeed News: "Given the very serious allegations that have been made against RBS, it is right that the Financial Conduct Authority investigates these claims thoroughly, which it's in the process of doing.
"While that investigation is ongoing into the serious allegations it wouldn't be appropriate for the government to comment on the substance of the allegations while investigatory work is being carried out."
An MP for the Scottish National Party, George Kerevan, called on RBS bosses to volunteer to appear before the Treasury select committee, saying the revelations have raised too many questions to ignore.
"I, as a Treasury select committee member, will be speaking to the chairman and I assume that we will have RBS back before us at some point," said Kerevan. "I think it would be advisable for RBS to volunteer to come back towards the committee rather than be called before us. There are now enough questions that RBS should appear before the committee."
In Edinburgh, where RBS is headquartered, the Scottish Liberal Democrats have called on the bank's chiefs to be grilled in front of a Scottish parliament committee.
“RBS is a Scottish bank, headquartered in Edinburgh, and doubtless there are businesses here that have been affected by the shameful tactics that the company seems to have employed," said Scottish Lib Dem leader Willie Rennie.
"Bank bosses need to come to Holyrood and explain themselves.”
In a statement, RBS said: “Despite a number of investigations that involved a detailed review of all the evidence, including reviewing millions of pages of documents, we have seen nothing to support the allegations that the bank artificially distressed otherwise viable SME businesses or deliberately caused them to fail.
"In regard to the wider allegations raised, we have found no evidence that the bank either inappropriately targeted such businesses to transfer them to GRG or drove them to insolvency. Nor did it buy their assets at a lower than market price."
Jamie Ross is a Scotland reporter for BuzzFeed News and is based in Edinburgh.
Contact Jamie Ross at email@example.com.
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