The news The Herald reveals today that 19 former directors of the Royal Bank of Scotland are to receive notification of a damages claim of up to £3 billion will bring a grim satisfaction to far more people than the 7400 individuals and 80 institutional investors behind the letter of claim.

The claim alleges that both RBS and the directors at the time of its near-collapse in 2008 are liable for the massive losses suffered by shareholders, as a result of misleading statements and critical omissions that put a positive gloss on the bank's financial health. If it is successful, individual directors, including the former chief executive Fred Goodwin, former chairman Sir Tom McKillop and former head of investment banking Johnny Cameron could all suffer financially.

This is because when the former board announced a £12bn rights issue in April 2008, they claimed this would provide enough working capital to survive unaided for the next 12 months. While we now know this to have been, at best, irresponsibly optimistic, far more damaging are the allegations by the shareholders' action group that the bank failed to disclose it was reliant on billions of dollars of emergency loans from the US Federal Reserve and continued to present the acquisition of ABN Amro in glowing terms after the scale of the toxic debt became apparent.

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Ordinary bank customers, let alone shareholders, whether they are institutional investors or individuals whose holding is the result of decades of saving from a hard-earned salary, rely on banks to be run within both the spirit and the letter of the law. At a basic level we expect and require bank managers to hold businesses and individuals to account if they borrow over the agreed limit or renege on payments. The same must apply to the banks whose business is dependent on trust. That is bolstered by law and strict regulations and it is the job of the Financial Services Authority (FSA) to ensure compliance. When the FSA published its report into RBS in December last year, however, it firmly laid the blame on past RBS managers, most notably Mr Goodwin, but specifically drew back from finding either RBS or any individual guilty of any regulatory breach and concluded there were no grounds for prosecution. The shareholders' action group is about to put that to the test with its claim that the former directors were in breach of the Financial Services And Markets Act 2002 and other regulations.

However, the FSA has acknowledged the need for personal accountability by bringing in a new measure requiring directors to hold more of their pay in a separate account which could be returned if the bank gets into difficulties. The RBS shareholders are right to pursue their case. It is not vindictive to argue that, given the scale of risk many were willing to take in pursuit of significant personal gain, it is reasonable that individual bank directors should face financial consequences in the case of a failure.