Lloyds Banking Group (LON:LLOY has reached a settlement with a whistleblower who accused former bosses of concealing a fraud at the HBOS Reading unit, Reuters has revealed. Six people were jailed last year for their role in the scheme which saw corrupt employees at the division impose a firm of turnaround consultants on their small business customers in exchange for bribes.
Lloyds’ share price has been steady in today’s session, having added 0.39 percent to 59.01p as of 13:35 GMT. The advance is largely in line with gains in the broader UK market, with the benchmark FTSE 100 index currently standing 0.33 percent higher at 7,077.25 points.
Bank reaches deal with Sally Masterton
Reuters revealed today that Lloyds had settled with Sally Masterton, a former serious risk officer at the group, over her treatment by the lender. In 2013 she compiled a document, known as the Project Lord Turnbull report, which alleged that HBOS executives knew of the fraud years before the takeover by the FTSE 100 group and failed to properly disclose it, with implications for the HBOS deal.
The newswire reported today that Lloyds had said that Masterton had acted with integrity and good faith at all times, and that she documented her concerns in a report following a request from the bank – a point it had previously disputed. The bank has further agreed to pay her financial compensation.
“I am pleased that Lloyds Banking Group has listened to me […] and has recognised the distress and inconvenience this has caused me,” she said in a statement, as quoted by Reuters.
The news comes after it emerged last month that the Serious Fraud Office was considering a fresh investigation into the HBOS fraud.
Analysts on bailed-out lender
Credit Suisse, which rates Lloyds as a ‘buy,’ set a price target of 7,077.25p on the shares last week. According to MarketBeat, the bailed-out lender currently has a consensus ‘buy’ rating and an average price target of 76.28p.