Activists file a lawsuit against Royal Bank of Scotland
It has been revealed that the RBS Shareholders Action Group has appointed a prominent UK law firm to stake a claim for damages in the region £9 billion against the Royal Bank of Scotland. The allegations centre round a £12 billion rights issue announced in May 2008, just prior to the collapse of the company and the government injecting taxpayer funds to bail out the operation. A number of shareholders believe that there may have been discrepancies in the rights issue prospectus although this is a matter for the courts to consider in due course.
Whether or not this particular claim is successful, and there are rumours of institutional shareholders becoming involved, is open to debate but it will potentially ask a number of very embarrassing questions for the Royal Bank of Scotland management. If the company is in anyway seem to have misled shareholders there could be substantial losses incurred which would no doubt be covered by the UK taxpayer yet again!
This is not the first time we have seen shareholder activists attacking the Royal Bank of Scotland although it has to be said that previous attempts have in the main fallen flat. Whether this one is different remains to be seen.
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