Recovery experts ready to lift lid on Northern Rock
R3 say the are willing to help uncover the practices that led to the fall of banking giant Northern Rock
Business recovery specialists are ready to help the new management of
Northern Rock shine a light on the practices that led to the fall of the banking
giant.
In the wake of chief executive Ron Sandler announcing that he is gearing up
to investigate the bank’s former management, The Association of Business
Recovery Professionals (R3) has told Accountancy Age that it holds key
information on procedures at the bank.
Nick O’Reilly, president of R3, said: ‘Way before the bank got into trouble
our members we’re saying, “What’s going on at Northern Rock?” because people
trying to get IVA’s were having problems.
‘They were turning away nine out of 10 individual voluntary arrangements even
when they would be getting back 100p in the pound,’ O’Reilly said.
The R3 president said that the association had information stretching back to
August 2006 and was ready to volunteer the data to Sandler and the rest of the
Northern Rock management.
The government bailed out Northern Rock with a £25bn loan last year and is
still trying to find a valuer to put a price on the bank with the government’s
help taken out of the equation.
O’Reilly’s main objective was to highlight the historic practices at the bank
which may have contributed to its downfall.
He added that the bank had gone to the lengths of openly shooting down R3
members’ efforts to set up IVA’s.
‘We were very upset about Northern Rock’s public statement that nine out of
10 IVA’s were inappropriate. They were accusing our members of doing
inappropriate voluntary arrangements, but they were turning down 90% of them.’