RBOS Shareholders Action Group

SandLake

Just received a letter from the RBOS Shareholders Action Group wanting money. I was initially reasonably happy with these people but now can't find any mention of them in the last few years and think that they are now taking the michael.

Does anyone know anything good or bad about them?

barak

They have been sending periodic updates for several years and now seem ready for legal action. Their website is http://www.rbosaction.org/

The sins of RBS are well-known, but goodness knows whether any action will succeed. Shareholders who subscribed to the infamous Rights Issue will feel the most hard done by.

It is alleged that some of the RBS directors were aware that the acquisition of ABN Amro had seriously damaged RBS, but that the situation did not get a mention in the Rights Prospectus, which anyone who has ever read one will know normally contains a long list of risk factors.

Financial Services and Markets Act 2000 - Section 90
[F1Compensation for statements in listing particulars or prospectus]
(1) Any person responsible for listing particulars is liable to pay compensation to a person who has—
(a) acquired securities to which the particulars apply; and
(b) suffered loss in respect of them as a result of—
(i) any untrue or misleading statement in the particulars; or
(ii) the omission from the particulars of any matter required to be included by section 80 or 81.

[Incidentally - this action group shouldn't be confused with "RBS Action Group" at http://www.rbsactiongroup.co.uk/]

sabretoothtigger

They are effectively trying to sue the government. Also wasnt the size of the rights document like 50 pages, shares are expert investments so its a bit flawed to argue when it doesnt work out.

Would be more likely trying to garnish Goodwins pension as derived from criminal negligence or something

barak

sabretoothtigger wrote: »

They are effectively trying to sue the government. Also wasnt the size of the rights document like 50 pages, shares are expert investments so its a bit flawed to argue when it doesnt work out.

Would be more likely trying to garnish Goodwins pension as derived from criminal negligence or something

They are apparently planning proceedings against Goodwin, [Johnny] Cameron, McKillop and others as well as the bank itself. I do wonder where any substantial compensation would come from. I've no idea what the extent of any liability insurance might be. :undecided.

There is always some risk in investment but in this case I don't think it's a question of it 'not working out'. That might be true of flotations like Fidelity China Special Situations and Glencore where the risks were stated, apparent and well-known - but with RBS the allegation is of misleading investors by withholding potentially disastrous financial information.

For anyone who is interested :question: the prospectus had 148 pages.
http://www.rns-pdf.londonstockexchange.com/rns/9677E_8-2008-10-2.pdf

opinions4u

RBOS Shareholders Action Group

The big worry is how to abbreviate Shareholders Action Group without sniggering.

sabretoothtigger

Kinda appropriate since it was screwed up

That might be true of flotations like Fidelity China Special Situations and Glencore where the risks were stated, apparent and well-known

There is zero case there, the market price went down and.. Just bringing that up seems to highlight why the case is most likely to fail, you cant sue for losing money maybe if this was USA.
RBS is listed there, has any case suceeded?

They have to prove some kind of criminal deception when we are already talking investment banking which is voodoo at the best of times.

I heard of one company, its main asset was some prize diamond worth 8 million. It was clear when examined to never have been worth more then 20k. The share price fell apart and it was deception, I imagine a case might have won though nobody had money to pay out

Are they trying to argue the same thing about Housing debt securities, sorry aint working. The price fell and its tough luck, RBS had a stupidly risky policy but Caveat emptor

Any lawyers involved know this but this is just business to them, they'll try the case and charge their fees hence they will be needing it all up front

barak

sabretoothtigger wrote: »

.....you cant sue for losing money.....They have to prove some kind of criminal deception.

Presumably that's exactly what they'll try to do. It's not just about investors losing money - it's about whether there were untrue or misleading statements or omissions in the prospectus.

The RBoS Rights Issue was enormous - the largest ever - and raised 95% of the £12bn [Twelve billion!] on offer. It's not about what happened subsequently - it's about what had gone on before and 'may not have been' revealed at the time.

I'm not saying that any action will succeed. You may well be right in thinking it will fail. As I said before "... goodness knows whether any action will succeed". I was just responding to SandLake's original post and have quoted the relevant section 90 of the FSAM Act 2000.

eildon

Sorry posted this on the ISA Board last night, should have posted it here. Apologies for re-posting Thanks to Vortigern for telling me

Have had letters asking me to join action group before but just binned them. However, now seen on press that action is going ahead and don't know if I should put in the £350 asked for to be part of the action.

Don't know if there is much chance of a settlement and it says if there is one if you are not in the action group you would be unlikely to get anything.

Can't afford to get involved if there are likely to be more calls for money for the court action.

Any advice would be appreciated as don't know anyone else that bought the rights.

Does anyone else have any new thoughts on whether to join in the action group or not?

Many thanks