Ian Fraser's scoop last week in The Herald about City lawyers Herbert Smith's defence of Fred Goodwin, Sir Tom McKillop and Johnny Cameron, and RBS v the RBoS Shareholders Action Group, has whetted appetites for what might – if it goes to court – be the cathartic investigation that politicians and regulators have avoided so far.
Herbert Smith will attempt to show that there is no proof that Fred & Co knew how bad things were with ABN Amro when they solicited shareholders' cash in April 2008 for the UK's largest rights issue (£12 billion). The shareholders, represented by Bird & Bird, are expected to call high-level former RBS executives as witnesses who will claim to have discovered the extent of the financial carnage wrought by synthetic credit derivatives and other toxic treasures in ABN's Amsterdam and New York vaults after the fateful deal, but before the rights issue. The group intends to "issue proceedings against RBS by its half year results on August 3".
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