The Royal Bank of Scotland (RBS) could face a deeper exposure to the Libor scandal than Barclays, according to a Labour MP who is a member of the Treasury Select Committee (TSC).
John Mann MP has claimed that RBS could face a higher find than the record £290m fine imposed on Barclays by US and UK regulators after it was found to have manipulated the interbank lending rate.
More than a dozen other leading banks are being investigated over their alleged involvement in the rate-rigging of the rate that is used to price trillions of financial transactions.
Mr Mann wants to know the level of George Osborne’s knowledge of the Libor investigation into RBS, bearing in mind its status as a bank that is 81 per cent owned by the UK taxpayer.
Mr Mann said: “The suggestions being made are that RBS was more chaotic than Barclays, the whole way they were operating and, therefore, whatever was being done, RBS was doing it more crudely.”
"It's not credible that UKFI, who represents the main shareholder ie, the taxpayer, was not kept informed of the investigation and it's seriousness. Either George Osborne is failing to run the Treasury properly or he is failing to tell parliament what he knows."
A spokesperson for the Treasury said it would not comment on a current investigation.
Meanwhile, a former trader has revealed that RBS’s internal checks were so lax that almost anyone could manipulate the rates.
RBS chief executive, Stephen Hester has already said that he expects the bank to receive fines. Commenting on the wider issues surrounding Libor and banking standards, last month he said: “An element of banks became detached from society around it, an element was for traders making money for themselves or the banks, and customers were the means of making money. We have to be sure that banks do it the other way around."
Announcing RBS’s interim results earlier this month, Mr Hester said: "We will stand up and take any punishment that comes our way.”
Reports suggest that RBS will agree a settlement with US and UK regulators in the next two months with the UK government keen to end the saga as it tries to protect its investment and position the bank towards being able to provide the UK taxpayer with its money back.