Watchdog told: ‘force RBS to compensate firms that went bust’

The Global Restructuring Group, RBS’s business recovery arm, has long stood accused of mistreating small firms in difficulty, and even driving some firms into insolvency.

The bank has denied the allegations, but announced last month it had set aside £400million to compensate small firms for failings in the way it handled them.

City law firm Berg said that the Financial Conduct Authority must examine the detail of the scheme, which has yet to be announced.