Thames Valley police arrest two men and a woman one of who is a senior HBOS banker as part of investigation of ‘large-scale fraud’ allegations
Two men and a woman were arrested in dawn raids in Berkshire, Warwickshire and Cheshire today as part of a police investigation into allegations of “corruption and large-scale fraud” at an HBOS branch in Reading.
The three were arrested on suspicion of corruption, conspiracy to defraud and money laundering by the economic crime unit of Thames Valley police. They have not been charged and remain in police custody.
The police said the case had been referred to them by the Financial Services Authority, which began investigating loans granted by the Reading branch after three years of campaigning by businesses that claimed they had been badly treated.
The police did not reveal the identities of those involved but they are believed to have been arrested as part of Operation Hornet, a four-month investigation involving 28 officers from the Thames Valley force.
Thames Valley police said: “The Thames Valley police economic crime unit can confirm they are investigating a corruption and large-scale fraud in connection with HBOS. The case was referred to Thames Valley Police by the Financial Services Authority. A number of warrants were carried out addresses in Berkshire, Warwickshire and Cheshire today.
“Three people – two men, aged 48 and 65, and a woman aged 48 – have been arrested on suspicion of corruption and conspiracy to defraud and money laundering. They remain in police custody. The investigation is still in its early stages and Thames Valley police will not be releasing or confirming any further information for operational reasons at this time.”
The FSA referred the case to Thames Valley police because the alleged offences took place at an HBOS branch in Reading. The FSA began its investigation after businesses claimed that they were forced to employ a consultancy firm as a condition for the granting of a loan.
A spokesman for Lloyds Banking Group, which owns HBOS, said: “We cannot comment on the detail of this investigation by Thames Valley police. Bank of Scotland itself is not the subject of the investigation. We have been assisting the police with their investigation.”
This article about alleged criminal activity inside HBOS / Lloyds Banking Group, was published in the Guardian on 29 September 2010. To read the article on the Guardian website, click here.
Ahead of other media on this one Ian, no surprise there then!! Was it on any of the news channels last night or this morning? Is the power of the banking sector a factor in that I wonder?
When you are able to write your ‘more complete’ version will you be expanding it to include the possible precedent outlined in your Qfinance blog on auditor liability that likely future liability of Ernst & Young/KPMG when variously auditors of BOS/HBOS dating back to around 1989?
Surely it can’t be long before they have to stand behind their audits and explain why they had a CONFLICT OF INTEREST with each other, and BOS/HBOS, in the period 1989/2003, at least?
Come on Lloyds Banking Group shareholders: Why aren’t you demanding restitution for your losses from E&Y/KPMG for the mess that Gordon Brown and ‘his man Blank’ got you into….and get regulators and courts in the US working alongside those in London to establish this precedent that auditors must bear proportionate responsibility when such claims are adjudged!-
Incidentally, one wonders if PWC went through the previous decade’s worth of audits as part of the due diligence before Lloyds said yes to the acquisition of HBOS? If not, why not? Just as relevant, if they were not allowed the time to do that, then have they done it since? If so, what are their conclusions?
Maybe now the truth will come out about the similar conduct pre the alleged HBOS Reading frauds! (such as “The Baker’s Dozen“) and persuade Lloyds to admit that it’s not just one “rogue banker” who’s enriched himself by asset stripping the wealth of customers – but rather a pattern of the conduct defined above that was known in the former BoS Governor’s office in the 1990s….and in that of LBG on this very day?? Their stance of ‘in denial’ in:
“We cannot comment on the detail of this investigation by Thames Valley police. Bank of Scotland itself is not the subject of the investigation. We have been assisting the police with their investigation.” – is being made to look increasingly hollow isn’t it?
Alan Edwards
alanedwards4@hotmail.com