Barclays chief reveals BoE involvement in Libor scandal
Barclays has disclosed details of a phone conversation which places the Bank of England at the centre of the Libor rate-setting scandal.
The bank revealed details of a phone call between its former chief executive Bob Diamond and deputy governor of the central bank Paul Tucker in 2008.
It revealed that Tucker told Diamond that Barclays’ Libor submission did not always need to be as high as it was at the time. The bank added that while Diamond did not view Tucker’s comment as an instruction, the bank’s chief financial officer Jerry del Missier did.
Both Diamond (pictured) and del Missier resigned from the bank in the wake of US and UK regulators slapping a fine totalling £290m onto Barclays’ in the wake of the rate-fixing.
An internal memo sent by Diamond to other Barclays executives relating to a call between himself and Tucker said: “Further to our last call, Mr Tucker reiterated that he had received calls from a number of senior figures within Whitehall to question why Barclays was always toward the top end of the Libor pricing.
“Mr Tucker stated the levels of calls he was receiving from Whitehall were senior and that, while he was certain that we did not need advice, that it did not always need to be the case that we appeared as high as we have recently.”
Barclays said in its evidence: “Jerry del Missier concluded that an instruction had been passed down from the Bank of England not to keep Libors so high and he therefore passed down a direction to that effect to the [traders].”
According to the BBC, former Labour minister Baroness Vadera released a statement last night reacting to the involvement of the government at the time.
She said she “has no recollection of speaking to Paul Tucker or anyone else at the Bank of England about the price setting of Libor”.
Diamond is due to appear before the Treasury Committee later today, where he is expected to add more details on the conversations with the Bank of England over the Libor issue.
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