Bob Diamond: key questions about the Barclays scandal
With former Barclays chief executive Bob Diamond appearing in front of MPs later, Channel 4 News looks at the questions he is likely to be asked.
Mr Diamond resigned on Tuesday as Barclays attempts to deal with the fallout from its admission that staff tried to manipulate the inter-bank lending rate, Libor, by submitting false figures on what it was costing Barclays to borrow from other banks.
These figures could have given the impression that Barclays’ finances were healthier than was really the case.
If they had any effect on Libor, which reflects the average borrowing costs of banks, individuals and businesses could have ended up paying more or less for loans.
Memo
On Tuesday, Barclays released a memo of a phone conversation between Mr Diamond and Bank of England Deputy Governor Paul Tucker.
The memo, written by Mr Diamond to Barclays’ then chief executive John Varley during the banking crisis in October 2008 , says Mr Tucker had said that Barclays’ inter-bank borrowing rates were higher than they needed to be.
The note also says that Mr Tucker had told Mr Diamond that “a number of senior figures within Whitehall” were worried about the rates at which Barclays was borrowing money from other banks.
Recent reports have suggested that Barclays believed it had received approval from Mr Tucker to talk down its borrowing costs.
‘Instruction’
But in a submission to the Treasury select committee, where Mr Diamond is appearing on Wednesday, Barclays says that while Mr Diamond had not believed he had received “an instruction” from Mr Tucker to alter the bank’s Libor declarations, his colleague Jerry del Missier had instead assumed this was the case.
The submission says: “However 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 submitters.”
These are the questions Mr Diamond may be asked:
* When were you first aware that Barclays staff were submitting false numbers?
* Did you take any action? If not, why not?
* What effect do you believe these false numbers had?
* Was your bonus boosted as a result?
* How were Barclays mortgage customers and other borrowers affected?
* Did these false numbers help you avoid a bailout from the government?
* Did you speak to Bank of England Governor, Sir Mervyn King, and Financial Services Authority Chairman, Lord Turner, the night before you resigned?
* Did they put pressure on you to resign?
* Did you believe they were reflecting the government’s wishes?
* What did Paul Tucker say to you during your phone conversation?
* Did you believe he was instructing you to alter Barclays’ Libor declarations?
* If not, why did your colleague Jerry del Missier form the opposite impression?
* When did you become aware that Mr del Missier had “passed down a direction to that effect to the submitters”?
* What did you make of Mr Tucker’s comment that “a number of senior figures within Whitehall” were worried about Barclays’ borrowing costs?
* Who do you think these figures were?
* Were they government ministers?