* Review follows evidence raised in $303 mln fraud case
* Bank under pressure from MPs to repay victims
* Six people convicted and given combined 47 years in jail
By Andrew MacAskill
LONDON, Feb 7 Lloyds Banking Group is
to review the cases of British businesses which lost out in a
245 million pound ($303 million) fraud for which six people were
jailed last week.
The fraud involved two former bankers of HBOS, once
Britain's biggest mortgage lender, which was rescued in a
state-engineered takeover by Lloyds in 2008. They helped siphon
off money from struggling businesses which were HBOS clients.
Lloyds, which says it too was a victim of the fraud, will
appoint a third-party to carry out the review and customer cases
will be looked at afresh after considering relevant evidence and
new details that emerged during the trial.
Six people, including the former HBOS bankers, were found
guilty of a scam involving fraudulent loans and sent to prison
for a total of 47-and-a-half years.
The sentences are among the toughest handed out for a
high-profile, white collar fraud in Britain in recent years.
"The group deeply regrets that the criminal actions have
caused such distress for a number of HBOS business customers,"
Lloyds said in a statement on Tuesday.
Lloyds has been under pressure to compensate victims of the
fraud, who allege it reacted too slowly to their complaints.
Members of Britain's parliament wrote to Lloyds on Monday
calling for them to properly redress hundreds of businesses who
were duped by the former HBOS managers.
George Kerevan, chair of the All-Party Parliamentary
Committee on Fair Business Banking, wrote in the letter that the
complaints were raised with HBOS management in 2007, and then
with Lloyds after it bought HBOS in 2008.
"In both instances, there was an internal failure to
adequately investigate these complaints," the letter said.
The corrupt bankers asked struggling business owners to
employ a turnaround consultancy as a condition for getting a
loan and they were obliged to pay the consultancy high fees for
services and, in some cases, hand over ownership.
Many of the businesses involved went into liquidation,
resulting in job losses and financial hardship.
($1 = 0.8088 pounds)
(Editing by Lawrence White and Alexander Smith)