Fred Goodwin: A very British humiliation

Fred Goodwin

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He was known as Fred the Shred, and now there's nothing much left to asset strip from the banker who flew too high.

Three years and four months after the Royal Bank of Scotland was saved from catastrophic collapse, the former chief executive is too much of a pariah to get much work in the UK, his bad reputation is global, he certainly can't work in finance ever again, his family life has gone awry, and now he's lost his title too.

What difference does it make? Well, to Mr Goodwin, he'll have to get his cheque books re-printed. That makes you wonder if he's still an RBS customer.

It may provide some satisfaction to those still angered by Mr Goodwin's behaviour at the bank, and his refusal to give any ground on that super-gold-plated pension - until it was too late and the reputational damage had been done.

But it raises questions for others who have honours and whose business or political careers go into a tailspin, bringing dishonour on the honour system.

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Taking away an honour does nothing to improve the safety of the banks or enhance the reputation of bankers. ”

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Two members of the House of Lords have been jailed; Lord Archer for perjury, Lord Watson for fire-raising. They sit in the upper house of the nation's legislature, but they haven't had their titles removed for serious breach of the law.

Mr Goodwin, by contrast, has not broken any law, other than that of good judgement. The Financial Services Authority went into his role in some depth, and did not censure him.

On the contrary, it found the system's checks and balances had failed where the RBS board of directors did not rein him in, and indeed the regulator itself had failed.

The man we used to call Sir Fred played the high-octane game of low interest rates and aggressive acquisition, which many others were playing.

He happened to play it extremely well, but vastly over-reached himself, particularly with the ABN Amro acquisition, and was most exposed when the music stopped.

Others who worked hard to get their gongs may be wondering just how secure they are now.

The award of honours is strangely, mysteriously British, and the withdrawal of honours is at least as strange. So this is a very British humiliation, coming inexplicably late after the events that brought RBS low.

Taking away an honour does nothing to improve the safety of the banks or enhance the reputation of bankers. It may be the closest we can collectively come to punishment, where the criminal law and contractual pension rights don't offer means of revenge.

Or could this be a decision that's been made to save the reputation of the honours system itself?

Douglas Fraser Article written by Douglas Fraser Douglas Fraser Business/economy editor, Scotland

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  • rate this

    Comment number 121.

    Brian Taylor has a new blog on today's First Ministers Questions on which no comment is allowed yet this over hyped media story is still open for comment. Is there any rational reason why we cannot comment on Brian's blog other than that the BBC may not like the comments. Is the BBC not meant to be impartial?

  • rate this

    Comment number 120.

    What about Gorbals Mick. The speaker of the house when all the expenses scandals took place. His 'punishment' was to become a Lord.

    What a Parcel o' rogues

  • rate this

    Comment number 119.

    What an inconvenience for Fred. All that specially ordered stationery will have to be pulped and new headed notepaper will have to be ordered. As the title brought no benefits, then he loses nothing having it taken away, Unlike his former customers at RBS. No wonder the Clydesdale Bank staff held a humongous party when he moved to RBS.

  • rate this

    Comment number 118.

    Many were pleased to ride along with Fred Goodwin when he raised the RBS from a small provincial bank to a world leader and this with the approval of the FSA.
    He committed no crime unlike Lord Archer, Lord Taylor or Baroness Uddin and others who retain their titles. It's a disgusting witch hunt and I feel some shame that it's the Tory party who have initiated this.

  • rate this

    Comment number 117.

    lol. cheeky.

    Just testing the BBCs link system

    Have a look at what our democracy is doing now, no taxes for certain government advisers.
    This is what they do in third world countries.
    Government ministers ignore those rules that are laid down as the basis for a civilised society.

    Ed Lester pays Zero Tax


Comments 5 of 121


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