A report issued by Britain’s Parliamentary Treasury Select Committee had harsh words for just about everyone involved in the LIBOR-rigging scandal, chastising former Barclays CEO Bob Diamond on his testimony; the bank itself for a culture that allowed the rigging to go on; regulators for lack of decisive action; and the Bank of England (BoE) itself.
In its report, published Saturday, the committee provided plenty of criticism to go around. In a separate statement, Andrew Tyrie, who led the parliamentary hearings at which Diamond testified, criticized the latter for testimony that “fell well short” of the “candor and frankness” such committees expect. He also slammed Barclays itself for “disgraceful” actions and a culture “that had gone badly awry.”
He was no more merciful to the Financial Services Authority (FSA), for failing to “get away from box-ticking and endless data collection” in favor of action on real risk, and the BoE, which he said should have had a system for keeping a record of conversations such as that with Paul Tucker, during which Diamond claimed the BoE provided “approval” of its London interbank offered rate (LIBOR) manipulations.
Tyrie also said that the BoE should not have intervened in the manner it did in Diamond’s ouster; instead, he said a process must be put in place “to ensure accountability and transparency for the process of removing senior bank executives in whom the regulators have lost confidence.”
Diamond was assailed on a number of points in his testimony, one of which was his assertion that authorities at the FSA were pleased with Barclays. In their testimony, regulators had cited numerous occasions on which they had challenged the bank on its culture as early as 2010, and challenged its attitude regarding risk as well, even suggesting that Diamond should not be so close with executives in Barclays’ investment management division.