Thousands of investors in Lloyds bank are being called to join a legal action against the group’s former chairman and CEO over the “disastrous” HBOS merger.
Campaign group Lloyds Action Now (Lan) said the banking group has a “duty of care” to contact thousands of investors so they can join a legal action against former chairman Sir Victor Blank and CEO Eric Daniels over the “disastrous” HBOS merger.
Lan wrote to Lloyds Nominees, which holds millions of shares in trust on behalf of individuals and institutions whose names do not appear on its share register, demanding it tells them about the case.
In addition, Lan has written to a further 3,000 nominees who represent 23,000 investors making the same demand. Lan chairman Nicholas Shaw said: “As professional trustees they have a clear duty to inform their clients about this action.
“First we had the fact that the Bank of England secretly lent HBOS £25.4bn. Then we find out the Federal Reserve of America secretly lent it $11bn. Now there are reports auditors only signed off its books because the Government gave a secret guarantee it would not go under. And we are still waiting for Lloyds to deny another report that it lent HBOS another £10bn to keep it afloat.”
Lawyers for Lan say shareholders were “misled over the merger because the full facts of HBOS were not declared to them in documents on which they were asked to vote and that government gave state aid unlawfully to HBOS contravening European legislation”.
Meanwhile, Lloyds was given another pummelling by the UK Banking Commission, which called for the group to sell off more of its branches.
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