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Royal Bank of Scotland fined £28.6 million in competition law breach

Royal Bank of Scotland (RBS) has been fined £28.6 million by the Office of Fair Trading (OFT) after it was revealed the company shared confidential details about the pricing of its loan service with staff at Barclays bank. Quite why staff from Royal Bank of Scotland would want to share confidential information with competitor Barclays bank is a mystery but the issue came to light after Barclays bank blew the whistle and informed the OFT.

It has been confirmed that between October 2007 and February/March 2008 RBS staff passed over generic and specific details about their banking facilities to Barclays bank counterparts during social events, industry events and over the telephone. Originally the company was set to be hit with a £33.6 million fine but this was cut to £28.6 million after RBS agreed to cooperate in full and the situation was resolved in fairly quick time.

Ironically, despite Barclays bank being heavily involved in the saga the company managed to escape a fine by whistleblowing to the OFT. The subject of competition in the UK banking sector is one which regulators are very sensitive about because by RBS passing information to Barclays, through unofficial channels, it was able to price its loan services at a similar level to RBS hence potentially leading to less competition for customers to benefit from.

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