Paul Tucker could be called before MPs over Libor scandal

Tim Wallace
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TOP Bank of England policymaker Paul Tucker could face a grilling from MPs over his relationship with embattled Barclays chief executive Bob Diamond, if members of the influential Treasury Select Committee (TSC) get their way.

“It is highly likely we will want to cross-examine top officials from the Bank of England, as well as the Financial Services Authority,” TSC member David Ruffley told City A.M.

Tucker met with Diamond and other senior Barclays staff at the time when the bank was manipulating Libor – and the Bank of England has been forced to deny he told them to submit the false interest rate readings.

“It is nonsense to suggest that the Bank of England was aware of any impropriety in the setting of Libor,” said a spokesman.

TSC member John Mann believes Barclays implicated the Bank of England in the scandal purely “in order to create a distraction” to take some pressure off Bob Diamond ahead of tomorrow’s TSC hearing.

But Mann is seeking evidence – he has asked the Bank for transcripts of the conversations and copies of emails. “If it turns out they did collude with this, the entire senior level of the Bank of England would need to resign and some should face prosecution,” he told City A.M.

However, the TSC must act fast – it has two weeks before parliament’s summer holiday puts its investigations on hold.

Ruffley and Mann also believe there is a clear case for Diamond to give back his bonuses from the years of manipulation.

“I would be very surprised if shareholders don’t want to revisit bonuses when the bank has admitted wrongdoing and been fined,” said Ruffley.