Tuesday, 3 July 2012

The heads begin to roll ~ Barclays ~ Libor aftermath

Following on from the Financial Services Authority report into fixing of Libor and Euribor rates - (discussed in an earlier post - here) - Mr Bob Diamond has resigned as Chief Executive of Barclays - Telegraph 3rd July.  The Statement by the Chancellor of the Exchequer 28th June contained no support for Mr Diamond and, in reality, he had must have had little option but to depart irrespective of his precise role in the Libor/Euribor matter.  He will be giving evidence to Parliament and is perhaps unlikely to pull his punches.  It is reported that he might receive as much as £17m in severance pay.

On 2nd July, the Prime Minister announced a Parliamentary Committee of Inquiry and it seems that this will report by the end of 2012 with a view to any findings informing the content of planned banking legislation in 2013.  (The planned legislation is to implement the report of the Independent Commission on Banking ).  Inevitably, there are mixed feelings as to the desirability of politicians conducting this inquiry - (e.g. The Guardian 3rd July) - but it seems that judicial inquiries (such as Leveson), for all their independence from the executive, may be proving to be too lengthy and costly for the government's taste and, of course, they may also prove to be very uncomfortable for politicians. 

See the statement in Parliament  (2nd July) of the Chancellor (George Osborne MP) which contains information about steps being taken and refers to the Terms of Reference of the Parliamentary Inquiry.

Amidst this financial maelstrom, a little light relief is thankfully available - see Charon QC - Advanced fraud for the modern banker.  

Addendum 4th July:  It seems that the plans for a Parliamentary Inquiry are already in turmoil - Daily Mail - "Cameron's bank probe in chaos: Inquiry Chairman threatens to quit before it starts and Labour warns of cover up." 

Addendum 5th July:  The law catches up with Libor - Alex Bailin QC 

and Telegraph "Government wins vote on Barclays inquiry and agrees to compromise on format" - the House of Commons rejected a judicial inquiry though the Attorney General intervened in the debate to warn against a speedy inquiry.

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