&9632;&nbsp; FSA will demand to see the contracts of five traders<br />&9632;&nbsp; JP Morgan and Barclays Capital in row over poached staff<br />&9632;&nbsp; Think tank calls for Commission to report on high earners<br /><br />CITY watchdog the Financial Services Authority (FSA) last night said it will demand to see the contracts of five traders being hired by Barclays Capital, following claims they have been lured to the group with a bonus deal worth &pound;30m.<br /><br />The FSA warned it will be &ldquo;rigorously enforcing&rdquo; its new rules on bonuses, which hope to reduce unnecessary risk taking.<br /><br />The FSA intervention came after a row over the&nbsp; hiring of Todd Edgar, a&nbsp; superstar commodities trader at JP Morgan, and his team of four to BarCap. The five have been lured with the promise of a generous bonus package.<br /><br />As is common in cases where trading teams move from one house to another, BarCap has bought out some of the traders&rsquo; deferred bonuses which they might have earned had they stayed with JP Morgan.<br /><br />Regulators may be concerned, however, that the traders receive their bonuses from BarCap, even though JP Morgan could potentially end up nursing losses from some of their deals.<br /><br />BarCap now faces an on-site visit from the FSA, as the regulator insists it can enforce a change in the bonus culture following widespread criticism that it watered down its rules to appease the City.<br /><br />But BarCap has said it will continue with its increasingly aggressive hiring programme in a bid to build a world-class investment-banking business.<br />The firm insisted its bonus structures are based on performance and will comply with the FSA pay rules, adding its leader Bob Diamond has made it clear he supports the FSA plans.<br /><br />Senior executives at the firm were furious about a report suggesting that JP Morgan had contacted the FSA to alert it to the generous bonus pledges used to poach the Edgar team.<br /><br />Sources close to the situation said last night such infighting could damage the entire banking sector in the long-term, as the end-result might&nbsp; lead to concrete laws on pay that would damage the competitiveness&nbsp;&nbsp; of&nbsp; the entire City.<br /><br />Sources said the &pound;30m figure for the combined bonuses of the commodities team may be inflated, and that the final package could be lower.<br />Edgar and his team are believed to be on gardening leave from JP Morgan, ahead of their move to BarCap.<br /><br />The scrap came after centre-left think tank Compass yesterday urged the government to establish an official High Pay Commission to report to the government on high earners.<br /><br />Chancellor Alistair Darling dismissed the need for a Commission on high pay, although Liberal Democrat&nbsp; shadow chancellor Vince Cable&nbsp; backed the idea.