Coutts standards investigation allowed bankers accused of inappropriate conduct to escape punishment

Coutts bankers accused of  inappropriate conduct escaped punishment, The Telegraph understands.

On Thursday the Wall Street Journal reported that the bank had investigated sexual harassment by star banker Harry Keogh. 

Mr Keogh, 57, who still works at the bank, was accused of inappropriate behaviour including sexually harassing a graduate trainee at a company dinner and touching her groin in front of colleagues at a meeting, the newspaper reported. 

But an investigation by the bank found that while standards in his whole team had dropped below par, he was the only one to be disciplined. 

Sources suggested to this newspaper that the "sexually charged" culture extended beyond Mr Keogh.

Speaking to The Telegraph a former Coutts employee, who wanted to remain anonymous, said she and her colleagues would regularly go on nights out with the men at private members clubs. 

"It was so sexually charged," she said. "It was obvious that the men wanted to sleep with the women."

On one occasion the woman, who left the company in 2014, claimed she witnessed another banker in the team who has now left the company, outside the Charing Cross Hotel "begging" another female colleague to stay with him that night. She turned him down. 

"You shouldn't have a man who you work with begging you to go back to a hotel with him," she added.

She said that where Mr Keogh was concerned, the alleged involvement of a graduate trainee led to a power imbalance. 

"The moment you're in a situation where you've come out of university, it's your first proper job, you've got a senior man acting in that way who may very well be deciding your end-of-year rating, and your own bonus, or promotion prospects - that's when it's wrong. That power imbalance is the thing that makes it awful."

Mr Keogh "shouldn't have carried on being employed", she said. "The only way that I think he kept that job is that he brought in enough business that he was protected. That's not the way it should be."

Another former employee said she left nights out because she felt uncomfortable about sexually charged conversations, and said Mr Keogh promoted a culture of "wining and dining, heavy drinking, staying in private members clubs" among his team.

It is understood that, since the investigation, Mr Keogh's role has changed significantly and he now has less responsibility.  

A spokesman for Coutts said the investigation covered all of Mr Keogh's team and found that "standards had fallen below what we regarded as acceptable" and said "decisive disciplinary action was taken as a result".

This disciplinary action involved withholding Mr Keogh's bonus, giving him a written warning and assigning him a coach, and did not affect any other members of staff, the Daily Telegraph understands.  

“The final recommendation in relation to this matter, followed an investigation involving HR, which ultimately led to the disciplinary outcome that the bank took," the spokesman said. 

Alison Rose, CEO commercial and private bank RBS, said: "Over the last few years I have appointed a new management team at Coutts and we have focused on improving the culture and [levels of] inclusion across the business. 

"This matter in question was properly investigated in line with our established policies and procedures and based on the findings of this process, appropriate action was taken at the highest level within Coutts.”

The WSJ reported that Mr Keogh accepted the disciplinary action without admitting to allegations and denied inappropriate behaviour.