Legal experts probe Goodwin's RBS leadership

A detailed probe is being drawn up into Fred Goodwin’s 10-year stint in charge of bailed-out Royal Bank of Scotland.

In a move which could put more pressure on the disgraced former boss’s £703,000 (€784,000)-a-year pension, the bank has lined up a top City law firm to look into his and other board members’ conduct.

It is also expected to examine whether there are grounds for legal action against senior RBS employees for their role in the group’s problems, and the group’s multi-million pound sport

sponsorship spending.

Last week the bank posted pre-tax losses of £24.bn (€26.9bn) for 2008 – a new UK record.

According to the Daily Telegraph, RBS chairmanPhilip Hampton has accepted a request from UK Financial Investments (UKFI), the bank’s majority shareholder, for the investigation.

Officials from the two parties are expected to meet shortly to discuss the framework of the inquiry – which is also set to apply to bailed-out banks Lloyds and HBOS.

A UKFI spokesman said: “UKFI is taking legal advice on a range of issues connected to Sir Fred Goodwin’s pension and his employment at RBS.

“UKFI has also asked the boards of RBS and Lloyds Banking Group to undertake major reviews of everything that went wrong at RBS and HBOS to establish whether there are any opportunities for taking legal recourse in those banks.”