Labour: Bank Libor claims need probe : MORNING STAR

Barclays chief’s admission suggests Bank of England involved


by Felicity Collier

LABOUR demanded a major investigation yesterday after it was reported that the Bank of England may have been involved in the Libor scandal.

Banks have paid out billions of pounds in fines for rate-rigging since an investigation into the Libor affair began in 2012.

The Libor rate is the international benchmark for interest charged by banks when lending to one another.

BBC’s Panorama programme reported last night that it had uncovered a recording from 2008 of a conversation between a senior Barclays manager and its Libor submitter, suggesting that the bank was putting pressure on lenders to “lowball” the rate.

Mark Dearlove, the senior Barclays manager, reportedly told the submitter: “The bottom line is you’re going to absolutely hate this … but we’ve had some very serious pressure from the UK government and the Bank of England about pushing our Libors lower.”

The BBC said it raised questions about evidence given to the Treasury select committee in 2012 by former Barclays boss Bob Diamond and former Bank of England deputy governor Paul Tucker about a phone conversation between the two men in 2008.

Mr Diamond claimed that an email — based on that conversation — about how Barclays had consistently been near the top end of Libor pricing was not an instruction to artificially lower Barclays’s rate. He quit Barclays shortly after the bank’s £290 million Libor-rigging settlement in the summer of 2012.

READ MORE : MORNING STAR

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