20 Aug 2012

Parliamentary investigation critical of Barclays

6:51 am on 20 August 2012

A parliamentary investigation in Britain into the rigging of rates at which banks lent money to each other has strongly criticised Barclays Bank for a lack of internal controls over several years.

The scandal emerged in June when British and US authorities fined Barclays £290 million for fixing a key inter-bank interest rate.

The Treasury Select Committee blames bank bosses for "disgraceful" behaviour which damaged the UK's reputation - the bank says it knows changes are needed.

The MPs criticise the FSA and Bank of England's regulatory supervision and accuse ex-Barclays chief executive Bob Diamond of giving them "highly selective" evidence.

The MPs said that the rate-rigging had done "great damage" to Britain's reputation.

They firmly blamed the bosses of Barclays bank for the way their staff tried to manipulate the Libor rate-setting process at various times between 2005 and 2009.

"(The actions) were made possible by a prolonged period of extremely weak internal compliance and board governance at Barclays, as well as a failure of regulatory supervision," Mr Tyrie said.

Mr Diamond resigned as Barclay's chief executive the day before he gave evidence to MPs.

In a statement, Mr Diamond said he answered every question of the parliamentary committee truthfully.