Today’s Guardian reports that Sir Phillip Hampton believed directors breached their fiduciary duties.
The news comes barely a week after the Financial Services Authority cleared RBS of all wrongdoing during the financial crisis.
Sir Phillip told a visiting delegation of politicians that one of the biggest mistakes made by the bank was its takeover of Dutch bank ABN Amro just as the credit crunch began in the autumn of 2007.
On 2 December the FSA said it could not find any director who had behaved with “a lack of integrity”, nor had it found “a failure of governance on the part of the board.”
The cable reports Hampton as acknowledging that RBS had made “several enormous mistakes”.
The cable states: “Top among them was its heavy exposure in the US subprime market and the bank’s purchase of ABN Amro, which occurred at the height of the market and without RBS doing proper due diligence prior to the purchase.
“The board of directors never questioned this purchase, which Hampton termed a failure of their fiduciary responsibilities.”
The conversation, recorded in a cable sent on September 11 2009, followed a meeting between the RBS chairman, who was nine months into his new role, and Democrats Paul Kanjorski and Luis Gutierrez, and Republican Scott Garrett.