Barclays director who led Libor fixing to face MPs
JERRY del Missier, the Barclays executive who instructed traders to reduce the bank’s Libor rate submissions, will today attempt to explain his actions to MPs.
He will be joined in front of the House of Commons Treasury select committee by three leading officials at the Financial Services Authority (FSA), including Lord Turner, who raised concerns about Barclays’ “aggressive” interpretation of regulations in April this year.
It will be del Missier’s first public appearance since he resigned as chief operating officer on 3 July, taking responsibility for his role in a scandal that has cost Barclays £290m in fines and caused its share price to plummet.
He had only been in the job for 11 days.
A close associate of former chief executive Bob Diamond, del Missier was previously co-head of Barclays’ investment banking arm.
Lord Turner will be asked why his organisation only began investigating abuse of the Libor rate in 2009, despite the New York Federal Reserve learning in 2007 that Barclays underreported its submissions.
He will be joined in front of MPs by Andrew Bailey, the FSA’s head of banking supervision, and Tracey McDermott, the FSA’s acting director of enforcement.
The hearings were arranged in a hurry, with MPs on the committee keen to hear as much evidence as possible before parliament rises for the summer recess tomorrow.
But on Friday it was announced that the new parliamentary inquiry into Libor-fixing would not include several of the Treasury select committee’s more outspoken members such as Conservative Andrea Leadsom and Labour’s John Mann, who had been fiercely critical of Bob Diamond.
Q and A: What MPs will be asking today
Q Why did Jerry del Missier instruct Barclays employees to fix Libor?
A Barclays has said that del Missier “misinterpreted” an account of a 2008 phone call between his fellow executive Bob Diamond and a Bank of England official. MPs will want to know how he came to the wrong conclusion.
Q Did del Missier discuss Libor-rigging with any other executives?
A Regulators in the US and UK say Diamond did not think Barclays had been told to fix Libor. So why did del Missier not double-check before telling traders to lower their submissions – and did he discuss his actions with others at any point?
Q How soon did the FSA know about Libor-rigging and how did it respond?
A US regulators had concerns about the interest rate in 2007 – so why did the FSA not intervene earlier? And if the organisation knew about del Missier’s involvement, why did it allow him to be promoted to chief operating officer in June?