U.K.-based bank Coutts & Co., which caters to the British royal family, allowed banker Harry Keogh to stay on despite an internal inquiry confirming allegations of inappropriate behavior, The Wall Street Journal reported, citing written accounts of the investigative conversations and people familiar with the investigation.
Senior banker Gayle Schumacher, tasked with investigating the complaints against Keogh, interviewed 20 Coutts bankers who told her about alleged inappropriate behavior by Keogh and other bankers, including lewd comments, heavy drinking and unwanted physical contact, according to the documents.
On learning of the allegations from Schumacher, Michael Morley, Coutts' then-CEO, told colleagues and the bank's parent Royal Bank of Scotland Group Plc that Keogh should step down, the people reportedly said. However, discussions featuring RBS' head of commercial and private banking Alison Rose, Morley and others, concluded in mid-2015 with the decision to let Keogh stay, though he was denied a bonus, issued a written warning and assigned a coach, they added, according to the report.
Keogh oversees fewer bankers now but was entrusted with Coutts' "most influential clients" in 2017, according to a press release cited in the report.
The banker denied the allegations, according to one of the people, and accepted disciplinary action without admitting guilt, another person reportedly said.
Terming the allegations "very serious," which "no one should ever have to experience," Rose added that "appropriate action was taken" in the matter in line with RBS' established policies and procedures.
The news of disciplinary action against Keogh was known to few at the bank and "nothing happened' after the investigation, said a person who cited Coutts' "treatment of women" as a reason for leaving the job.
