Two local authority pension funds are taking legal action against the Royal Bank of Scotland Group (RBS) to seek compensation for losses on investments they made with the bank.
The Merseyside and North Yorkshire pension funds are accusing RBS of not being upfront about the severity of its difficulties before the government stepped in to bail out the bank. The legal action has been launched in the US and Cherie Booth QC, wife of former prime minister Tony Blair, has been hired to fight the class action against RBS.
Patrick Daniels, a founding partner of the Coughlin Firm, and one of the lead attorneys on the case, said: “The filing of the applications for the appointment of lead plaintiffs is the first step towards achieving justice for those hundreds of thousands of investors who have suffered huge financial losses as a result of this bank’s massive failure of risk management at every level. We are proud to have formed a team comprising the best legal minds to represent our clients and we will be pursuing this claim relentlessly in order to bring the executives, especially Sir Fred Goodwin, and this bank to book.”
Peter Murphy, a partner from Sackers and Partners, said: "Although the public details of the claim are limited at this stage, the historic caution of UK pension funds to become lead plaintiffs in the US securities litigation suggests that those involved here are confident of the merits of the claim and have a significant amount at stake.
"The US legal system is an ideal forum for these types of claims. US lawyers act on a no-win no-fee basis and plaintiffs do not have to pay for the other side's legal costs even if they lose."
The pension funds are part of a group made up of other UK and Dutch investors, which are also taking legal action. RBS declined to comment.