Bob Diamond suffers moral defeat in New York.

Bankruptcy Court decides Barclays stole $4.5bn off Lehman

Who, me?

 

Barclays CEO Bob Diamond may be relieved that he didn’t wind up with a charge of misleading the regulatory authorities as the Lehman v Barcap trial wound up in New York today, but his victory is pyrrhic: the moral high ground (all things being relative) lies with the Lehman estate.

Judge James Peck had previously referred to Diamond’s evidence as ‘devious’, and while he ruled that the eventual deal was fair, Peck did agree with the Lehman trustee, James Giddens of Hughes Hubbard & Reed, that Barclays took some cash assets that were not part of the deal. They included $4bn in cash margin held by clearing houses for exchange-traded derivatives, plus $769m in cash held in “15c3-3”, or protected customer, accounts. That’s a lot of money.

“This was enormously important to us. If we hadn’t won this, it would have frustrated the trustee’s ability to pay customers,” said William Maguire, the trustee’s chief trial counsel.

Well, fair enough. You can see these as the finer points of corporate law. Or you can see the result as a foiled attempt to steal the NASA budget for the next four years off Lehman customers.

Either way, we on this eastern side of the Atlantic continue to wonder whether the Diamond Geezer is to be trusted: we harken not unto what he says, but rather watch what he does. And it isn’t encouraging.

 

 

 

 

6 thoughts on “Bob Diamond suffers moral defeat in New York.

  1. Therein lies the rub John, the diamond geezer must by default be trusted otherwise he can’t be one, and yet he is?

    It’s very Lewis Carrollish isn’t it?

    But curiouser and curiouser is you thinking $5B is a lot of money these days!

  2. Can I just point out that the man is not a “banker” he’s a “dealer”, which is not the same thing at all. Mind you, it’s closer to the business that Sir Fred of RBS fame who was something else entirely.

  3. The Banksters are out of control. No Govt ir regulatory authority will bring these international crooks to book. As this case proves it is investors and abused depositors through legal action doing all the donkey work to bring these frauds to justice.
    We live in a rotten world where Big Govt colludes in criminal activity with Big Biz by not applying the Law

  4. Pingback: BREAKING….Libor manipulation scandal goes to Court | The Slog

  5. Pingback: SCANDAL AT BARCLAYS: WHY AVENDIS LOSERS WILL SUE THE BANK | The Slog

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