Misinterpretation or conspiracy?...Barclays COO faces inquiry

Two weeks after he quit as the chief operating officer (COO) of Barclays after having misinterpreted chief executive Bob Diamond’s message regarding the Libor rate sanctioning, Jerry del Missier, will face an inquiry by the House of Commons Treasury Select Committee.

Del Missier is alleged to have told Barclays’ staff that the Bank of England (BoE) had sanctioned them submitting lower rates to bring down Libor, the rate that determines global transaction worth trillions of dollars.

The ex-COO has not yet issued a public statement in lieu of the matter and his evidence could be vital to explain who knew what at Barclays after testimony from Diamond which some committee members have characterised as misleading, a charge which Diamond has denied.

Adair Turner, chairman of the Financial Services Authority (FSA), and Deputy Governor of BoE Paul Tucker will also be questioned after del Missier. He will be interrogated on the regulator’s involvement and whether it was stringent enough when rate rigging occurred between 2005 and 2009.

Investigations also reveal that Barclays’ warning to the US regulators back in 2007 that banks had been rigging lending rates fell on deaf ears. A conversation in October 2008 between Diamond and Tucker is at the centre of confusion about whether Barclays was told by the central bank it could submit lower Libor rates.

In an internal memo written after that conversation, Diamond said Tucker told him “it did not always need to be the case that we appeared as high as we have recently.” Diamond has since said he did not take that as an instruction to submit lower rates, but said del Missier mistakenly understood the memo as a go-ahead to do so.

Related:
Barclays chairman Marcus Agius to resign today
Bob Diamond quits as Barclay’s chief executive