[Debate] Diamond hits back: how dare you suggest I misled inquiry
Riaz K Tayob
riaz.tayob at gmail.com
Wed Jul 11 12:29:26 BST 2012
[So hard to find good help these days, tsk tsk...
Diamond hits back: how dare you suggest I misled inquiry
Anger £2m payoff as doubts about his evidence grow
James Moore <http://www.independent.co.uk/biography/james-moore> Author
Biography , Oliver Wright
Wednesday 11 July 2012
Bob Diamond, the former Barclays chief executive, set out to defend his
reputation yesterday after being castigated by MPs for misleading
Mr Diamond angrily rejected suggestions that he had been dishonest about
regulators' concerns over activities at Barclays, calling the claims
"totally unfair and unfounded". He had earlier been accused of giving
"deliberately misleading" testimony to the Treasury Select Committee
when it had questioned him over the Libor scandal last week.
The row came as it emerged that Barclays had been criticised by
watchdogs for playing fast and loose with the rules just months before
the scandal broke. Bob Diamond wrote: "Having watched the committee's
session today I was dismayed that you and some of your fellow committee
members appeared to suggest that I was less than candid with the
committee last week.
"Any such suggestion would be totally unfair and unfounded."
As pressure grew on the former boss, Mr Diamond gave up £20m in bonuses
he was due to receive, but will still receive £2m from Barclays.
An incendiary letter to Marcus Agius, chairman of Barclays, from Lord
Turner, chairman of the Financial Services Authority, was made public to
the committee with Mr Agius's appearance. In it Lord Turner accused the
* Seeking to gain advantage "through the use of complex structures ...
which are at the aggressive end of interpretation of the relevant rules".
* Seeking to "spin its messages in a confusing and unhelpful manner"
during financial stress tests last year.
* Using up "resources and goodwill" by continually arguing with
watchdogs when rulings went against it.
* Draining trust away by its approach to issues including tax,
regulation and accounting.
The letter came despite Mr Diamond's suggestion that relations with the
FSA were good at a hearing of the select committee last week.
During the hearing with Mr Agius yesterday, MPs expressed fury over Mr
Diamond's evidence last week. "It will look to us, and frankly it will
look to everybody listening, like another example of a complete lack of
candour to Parliament by the chief executive of Barclays," said the
committee's chairman Andrew Tyrie, who accused Mr Diamond of a "cavalier
attitude" towards Parliament.
However Mr Agius said he could not speak for Mr Diamond and repeated
that view during a terse exchange with Labour's John Mann, who claimed
Mr Diamond had "calculatedly and deliberately misled this parliamentary
committee". Mr Mann added: "Mr Diamond has been misleading this
committee, hasn't he?"
Speaking after the meeting, Mr Tyrie said Mr Agius's evidence had
revealed Mr Diamond's testimony to be "implausible".
"Many of us thought that his replies were implausible, but didn't have
evidence to support that hunch," he said. "We [have now] begun to
collect quite a bit of evidence to suggest that Bob Diamond's
presentation of what happened was quite a long way away from what really
Mr Tyrie said the Committee would now consider the areas in which it
believed it had been misled.
Mr Diamond, he said, would be given a chance to respond.
Mr Tyrie highlighted the letter, which he said did not tally with Mr
Diamond's testimony. "It's clear from that letter that Bob Diamond's
suggestion that the Financial Services Authority was broadly happy with
what was going on in Barclays in February of this year ... simply
doesn't tally with a reading of the letter."
John Mann, a Labour committee member went further and said Mr Diamond
would have to be recalled.
"There's a constitutional issue here of whether we allow them to get
away with it. I think we've got no choice [but to recall Mr Diamond].
Parliament's reputation is at stake."
The regulator's view of Barclays appeared to be endorsed by the
corruption watchdog Transparency International, which rated Barclays
among the least transparent companies in terms of their financial
reporting. It came 71st out of 105 of the world's biggest publicly
traded companies. That put it beneath PetroChina and level with Saudi
The bonuses given up by Mr Diamond were "deferred" payments of shares
for work he has already done. But he will still receive £2m, made up of
a year's salary plus a payment in lieu of pension despite his
contractual notice period being only six months.
Mr Agius said this was because Mr Agius had agreed to be "at the end of
the phone" when required by Barclays bosses over the next year.
But critics argued that it was still too high. David Hillman, spokesman
for the Robin Hood Tax campaign, said: "It exposes the financial
sector's warped sense of entitlement that a seven-digit payoff for Bob
Diamond's failure is seen as acceptable."
The Independent's reporting of the Barclays affair was referred to
yesterday when the MP Mark Garnier asked Marcus Agius to respond to a
whistleblower who told this newspaper that employees at the bank worked
in a 'culture of fear'.
*Cameron's view: No apology required*
David Cameron does not believe George Osborne needs to apologise for
suggesting that former Labour ministers were involved in the Barclays
rate-fixing scandal, his aides said yesterday.
Labour is demanding the apology after the Bank of England's Deputy
Governor, Paul Tucker, denied in evidence to Parliament that any
minister or Whitehall official encouraged him to "lean on" Barclays to
lower its submissions to the crucial Libor index.
Following his comments, Andrea Leadsom, a Conservative member of the
Commons Treasury Committee which heard Mr Tucker's denial, said Mr
Osborne had clearly made a mistake and should now apologise.
She said: "It was a very valid discussion at the time about who knew
what and it has now been completely squashed by Paul Tucker."
But asked whether the Prime Minister agreed it was time for the
Chancellor to say sorry, Mr Cameron's official spokesman said: "The
Treasury has been making the position clear that he won't. He [Mr
Cameron] agrees with the Treasury."
The Foreign Secretary, William Hague, also dismissed the demand, telling
the BBC: "Parliament is a lively place and it should be, it's a free
Parliament. The Chancellor said there are questions to answer, there
remain questions to answer and I see no reason why he should apologise
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