LIBOR RIGGING: The Slog reveals why the enquiry must be judicial -

DOMINANT LIBOR DEALERS TOO CLOSE TO DOWNING STREET

TULLET PREBON’S URGENT NEED FOR LIBOR SCANDAL TO DISAPPEAR

Libor rate fixing leaves PM in a fix

‘A Molotov Cocktail Party’ of conflicted interests

As David Cameron might say, let’s be clear about this: Tory Party supporting inter-dealer brokers like Tullet Prebon and ICAP provide liquidity and anonymity to buyers and sellers. These clients are frequently banks of one form or another. Michael Fallon insists that Tullet’s “helped to nail the banks” – but given the confidentiality of the firm’s role and the BBA CEO on board as a Senion Non-Exec, this is quickly revealed to be nonsense: for them to have done this would’ve required both a betrayal of client trust, and massive business losses.

In fact, even the suspicion that they might have turned Queen’s Evidence with the FSA has helped lead to a fall-off in business at both ICAP and Tullet’s. At the latter, ‘Banks that use the services of brokers like Tullett’s are scared so they’re doing less business’ wrote The Times last September; and they weren’t wrong. Tullet Prebon income dropped 3% in both November and December of last year, and the firm’s year was flat at £910m of income. In January of this year, Tullet’s cut 80 jobs, and then a further 80 in March.

In short, the continuing mistrust, suspicions and controversy surrounding the Libor rate are ruining Tullet’s business. The firm therefore has an enormous conflict of interest via Michael Fallon’s membership of the Treasury Select Committee – and a life-or-death desire to see the scandal go away.

Taken together and with new information added by The Slog’s research, the Libor Party is revealed as being a seamless relationship between the Conservatives and the Libor broking sector – or as one senior investment bank staffer put it yesterday afternoon, “The Libor Party is amusing as a monniker at one level, but the inbred nature of it means it is really a highly inflammable Molotov Cocktail Party about the blow up in the Tory Party’s face”.

Read on now and see why this source’s view is easily vindicated.

Key players in the Libor Party:

Angela Knight, Michael Fallon, Terry Smith, Michael Spencer.

What they all have in common:

They all support or work for the Conservative Party

They’ve all been involved in the Libor sector for years

They all have obvious conflicts of interest

The five organisations involved in this cosy crony-club are the British Bankers’ Association (BBA), ICAP, Tullet Prebon, The Treasury Select Committee (TSC), and the Conservative Party.

Michael Fallon is Deputy Chairman of the Tory Party, a senior member of the TSC, and a senior Board member at Tullet Prebon – a company described to me last night by a City insider as “dominating the Libor sector”. At least three of the major institutions reporting on Libor rates are known to be Tullet clients. Fallon may thus have been questioning one of his clients when he interrogated Bob Diamond of Barclays last Wednesday.

Angela Knight was until recently the CEO of the BBA, an organisation on behalf of which she gave misleading Libor evidence on at least one occasion. She is a non-Exec director of Tullet Prebon, and she used to be a Conservative MP.

Michael Spencer  is the founder and CEO of ICAP, the largest Libor-sector money brokerage in Europe, he used to be the Tory Party’s Treasurer, and he (and his company) last year donated £1.3m to the Conservative Party. In 2010, Spencer was censured by the City for selling £45m of ICAP shares three weeks before issuing a profit warning.

Terry Smith is the CEO of Tullet Prebon. Derek Tullett, founder of inter-dealer broker Tullett Prebon, was listed as ‘a major contributor’ to Tory Party election funding during 2010. On his Board he has collected both Fallon and Knight, and although Fallon says Tullet’s “helped to nail the banks” that must in turn have put Angela Knight into an awkward position, she being the UK’s greatest defender of both the Banks and Libor. Smith spent the first five years of his life working on the investment side at Barclays, and is an Associate at the Chartered Institute of Bankers.

Is Britain still a country where the chosen few look after each other and ignore the law? If the conflicts outlined above do not lead to a judicial enquiry at least, then the answer must be a resounding “Yes”.

Related: Why the role of The Enquiry in contemporary Britain has been perverted

50 thoughts on “LIBOR RIGGING: The Slog reveals why the enquiry must be judicial -

  1. An infinity of enquiries? Better collectives in this case might be:
    An inquietude .(or)
    An iniquity of enquiries

  2. In the distant past Tullet Prebon was Tullet and Tokyo. And their logo was a castle, as in chess piece. Or possibly a turret. The Tokyo bit was Derek Tullet getting the Tokyo Forex Company on board and I assume that the logo was their pronunciation of his name.

    • lol
      I had a summer job at Tullet & Riley in the 70s before they became Tullet and Tokyo. Only on reception though before anyone asks me if I fiddled any rates that were around then…

    • Well kfc, the EUR/USD is at 1.2288, the lowest it’s been in years, so the forex folk aren’t too impressed with the recent saving of the euro. Brussels will have to be up to something quickly.

  3. Pingback: John Ward – LIBOR RIGGING: The Slog Reveals Why The Enquiry Must Be Judicial – 6 July 2012 | Lucas 2012 Infos

  4. This is a job for the police. The problem is, the police are too busy right now, after all, it takes 25 police cars and a small batallion of marksmen to chastise a man for using aid to give up smoking, so its not surprising none of these bank robbers has had their collar felt so far.

    • @BR; There was an accident (RTA) just around the corner from where I live. They closed the road. That took 1 police car, 2 ‘Accident’ signs, and TWO police officers, obviously to control the hoardes of people that were going to ignore the sign and drive straight thought the road block!

  5. This seems much in line with Blair’s profiteering from his premiership by property speculating and his connection with JP Morgan. Unfortunately there are no laws to prevent this sort of thing, and it is difficult to see how such laws could be constructed to make prevention of profiteering from being and MP a watertight offence. I am in favour of devolving government expenditure to the lowest level to make influencing of politicians with “bribes” less valuable and also believe that government should be continuously monitored by random juries of ordinary citizens. However, if this is what MPs in the public eye get up to, can you imagine how corrupt the unchanging upper echelons of the civil service must be?

    • “However, if this is what MPs in the public eye get up to, can you imagine how corrupt the unchanging upper echelons of the civil service must be?”

      Er nonsense….

      Firstly where is your evidence for this?

      Secondly, as it’s open season on here (and in the Daily Mail) on civil servants, who would be stupid enough to risk their career by being corrupt?

      The civil service is an easy target, damned if it does, and damned if it does’nt…

      But of course there’s never any corruption in the saintly private sector, honest guv….

      Yours an (un) civil servant…

      • Actually, I would ask which civil servant wouldn’t be stupid enough not to be corrupt – in order to maintain his employment and prospects. 
         We will see on Monday when the bank oficial gives his interpretation of the truth – I wish him luck at the kangaroo court and wonder which chinless wonder plays Rumpole.   

      • Sorry Stuart, you are understandably sensitive about a generalisation. That said I have dealt with thousands of civil servants over too many years and corruption is there. As far as the ” saintly private sector” don’t make me laugh, every bit as corrupt as the civil service I’m afraid. The common factor, ie humans, means it cannot be otherwise.

    • Actually there are two very good laws to curb this sort of behaviour, one is called Sedition and the other is called Malfeasance. The problem is, as far as I can see, is that the UK police have allowed themselved to become so politicised that they are no longer willing to do their duty.

  6. Is Britain still a country where the chosen few look after each other and ignore the law?

    LOL as far as I know yes. Any inquiry will be a waste of time and kicked into the long grass. How many more inquiries do we need for everyone to get that. Honestly, it is the height of madness. The judiciary is compromised and finding an independent judge who will not cave to a few quiet taps on his shoulders I think is bloody unlikely.

    Maybe it would work if the inquiry was chaired by member of the public. but of course we are all too stupid to be able to do such a role. I think F all comes of this. It will soon disappear from the headlines like so many stories before.

    BTW i was reading that story about brown and gold on toryblog and a poster posted a link to this. has anyone heard about this. Did blair really issue a gag order? is this one of those some of it it is true but also lots of it just speculation and mis-info

    http://www.thetruthseeker.co.uk/oldsite/article.asp?ID=12246

  7. Did anyone else see John Francis McFall, Baron McFall of Alcluith,MP doing the rounds of the tv studios demanding a proper inquiry to get to the bottom of what went on and to find out who is responsible. With suitable compensation etc ?
    Surely not the same chap who won the ‘kick it into the long grass’ competition when he chaired the inquiry into Equitable Life.
    The longest inquiry in the history of inquiries.
    Err how’s that inquiry going ? Heard it had been passed to the Tories who promised a ‘speedy resolution’ .

  8. Off with their heads! Tories of Liebor be not too bold, for Dave thy master is bought & sold.
    With apologies to Master Shakespeare.
    Excuse me, if I seem facetious, but being without an army, or even a gun, what else is there but humour?

    • And 160 German economists have written a strong protest letter concerning the craziness of bailing out Spanish banks when everyone and his dad knows that the proposed checks and balances and deficit limits will never work because the southern countries will simply ignore them. I guess that is part of the reason for the rising risk premium. What is the Frau Doktor up to? Is she taking U-turn lessons from the Tories? Are the Germans about to receive the biggest ongoing subsidy bill of the Bundesrepublik’s existence? It certainly looks like that. Germans are right to question this nonsense. If the Spanish get away with having the Germans pay off their bad debts, others will join the queue.

  9. Pingback: BRITAIN’S EU MEMBERSHIP: Cameron faces new EU Treaties and a referendum whether he likes it or not | A diary of deception and distortion

  10. Late last year the Armaggedon report from Tullet Prebon was released.
    This less than professional piece of work, would not pass academic scrutiny.
    However, it is worth reading, but is strongly biased against the last UK government, without really exposing the facts that the city of London and others have created vast debt mountains which have been going on for decades.

    Many benefit from this but not the vast majority of the population.

    • If you can point to anything of substance in their Armageddon report which is not professional, please let us know. Much of the content was based on officially released numbers.

      • The report typically compares, apples, oranges, pears and cherries. An example of this is the rolling in of unfunded pension liabilities into total debt, when this is not done in all countries to whom comaprisons are made.
        Whilst the figures are taken from available statistics they are interpreted loosely, the report is to wide and covers too many variables.

      • @Prof: Rolling unfunded liabilities into total national debt is a very common practice among serious analysts but not as you say by government, for very obvious reasons. Personally, I have always believed they should be shown, but quoted separately. The rest can be easily explained by the fact that Tullet Prebon is a right of centre org which was astonished at the gross mismanagement under Brown. If we saw a left wing report, it would have shown everything was rosy in the garden! In the words of Healey: “crises, what crises?”

    • Whilst not an academic view, personally I thought the Armageddon Report was rather good, if very depressing. It is surely incontestable that debt grew hugely during the last governments stewardship of the economy. The report also points out that this governments assumptions on growth are bollocks and that private debt was fuelled by reckless lenders-so hardly a cheerleader for the Coalition.
      With regard to Terry Smith, it must be pointed out that he is actually pressing for the separation of retail and casino banking. And it is not Tullet Prebon which has the conflict of interest in respect of Michael Fallon-it is Michael Fallon because he is the one with the quasi-judicial role.
      Of course, the UK’s problems began when our rulers decided that we could become “a service economy” and we didn’t need to make things, or grow things, so instead of sorting out the union and other problems of industry, they were solved by simply destroying it, the US approach in Vietnam. Absolutely effing brilliant-not!

      • correction: we can still make a bloody good mess of things.

  11. John, you should have been born a bloodhound ;-) Given that The Slog has now completed its wide ranging & forensic investigations, we can safely say that it wasn’t the last Brown govt and his cohorts who conspired with the BoE and others to rig Libor. Nope, it was the Tory Party – who weren’t even in office. Of course that was always a forgone conclusion. Labour were just innocent bystanders and victims of circumstance …

    More seriously, what is actually needed is not a Parliamentary inquiry nor even a judicial led inquiry (which Milipede wants to kick the issue into the long grass). We already know that Libor was being rigged and nobody denies it, so what we need is a criminal investigation. Why are the Met Police not already onto this?

    • @BT; ‘Why are the Met Police not already onto this?’
      I would imagine that it’s because the bankers might go to prison if they did, can’t have that, can we? Mustn’t kill the goose that lays the golden egg must we? And now Hollande is going to wring dry the owners of holiday homes in France, they could probably do with a little extra cash now.

      • @kfc: you’re absolutely right of course. It is surely a powerful sign of Britain’s slide into banana republicanism when the one organisation which has the power to uphold the law is itself in the pocket of the criminal elites and immersed in corruption at all levels. There is little hope coming out of this.

  12. The raison d’etre of the City of London is its authorities’ blind eye to white collar fraud. It is the only major city in the Western world with business connections and personal lifestyle where financiers can do more or less as they please without impunity. And they know it. All this nonsense about banking is one of Britain’s greatest industries is guff. It’s easy to make money (for yourself) if you’re woefully unregulated, but it’s not helping the society it’s enmeshed in.

    All the Daily Telegraph spin about banking being a major industry just means: our blue blood chums love the kerching, but only so we can get it offshore away from the proletariat.

    Why did MF Global do what it did here and not in America? Why did it set up shop here in the first place?

    Britain is at the heart of this cancer. Much of AIG’s shenanigans were set up in a British jurisdiction.

    It’s all fantastic, according to Tories, and makes Britain lots of money.

    No.

    It makes a lot of people with close connections to the Tory party money.

    The rest of us end up picking up the bailout tab.

  13. It was fascinating watching Fallon going ‘nuclear’ when he came to question Diamond at the Commons committee meeting. It was obvious all he was interested in was nailing Labour Ministers past and present for instructing Barclays to fiddle the Libor rate.

    For transcript see: http://www.parliament.uk/documents/commons-committees/treasury/Treasury_Committee_04_July_12_Bob_Diamond.pdf with Fallon wading in at: Q73. One of the few clear answers from Diamond was: Q83 Michael Fallon: I understand all that, but the effect of what you have written down here ( The note of the telephone call jotted down by Diamond) is that Ministers or officials were in effect asking you to fiddle your submission.
    Bob Diamond: I didn’t believe that, no.

    On a broader issue the transcript is proof positive of the inability of a Commons Committee to run an investigation into this matter. Even ignoring the total inability of the bulk of the committee members to pin Diamond down there was a general culture – if I dare use the word – of not actually finishing questions and not allowing Diamond to finish his answers which in reality makes the whole exercise useless as just turns into a spaghetti tangle. There was also the endemic problem which you see in just about every Select Committee proceedings – the pressing lack of time to carry out detailed questioning with some kind of structure to it.

    • I agree but the Select Committees are at least a means whereby the Commons actually can hold the Executive and others to account. The members need to be more independent though, and some coaching on effective questioning would be helpful. The tendency to be aggressive in the hope that the person being questioned will just break down is rather pathetic-and probably a measure of the MP’s exaggerated sense of their own abilities.

    • Actors sit near their phone awaiting there agents call. 
        The MP,s arrive at the audition /kangaroo court. Many have invested in new suits, hair do,s (even pieces), after all, this is their big day, The TV will ensure that their question is viewed by many. 
         The event is all about just how clever our politico,s are. Can they catch the diamond geezer out!!
       

  14. the news today is full of stories about big boris’s ‘shardon’, the illuminati’s subliminally supreme symbol of dominance over the city of london, which apparently somehow failed to err…illuminate…during its lazer-guided inauguration extravanganza last night, on the south bank. perhaps this is a subtle sign from almighty god that the pernicious power of the new-weird-odour is at last beginning to wane…?

  15. Excellent research. I also do a Blog and made tne connection of Knight & Tullet s but not all the rest

    You missed another highly amusing element that is Mr Agius is Chairman of the BBA and mysteriously resigned just a couple of days ago.

    He is also married to the daughter of Edmond de Rothschild

    What an incestuous infinitely corrupt bunch

  16. There is nothing in here which makes a convincing case that either ICAP or Tullets were involved in LIBOR manipulation, just general accusations.

    Also remember LIBOR stands for London InterBANK Offered Rate. ICAP and Tullets are Inter-Dealer Brokers not banks. There is the accusation that they exist to provide anonymity, this is not the primary purpose. They engage in two types of broking name give-up and matched principle. Name give up is not anonymous at all. Matched principal provides anonymity to the counterparties from each other, not from the regulators. Counterparties understand this.

    This article lacks accuracy it states that Terry Smith “… support or work for the Conservative Party” but provides no evidence. The author then refers to Derek Tullett and claiming that this is a connection, a ridiculous stretch. I think Terry Smith stood for the Referendum party in 1997, but not the Tories.

    Terry Smith often seems a bit nuts but he does occasionally talk sense like his calls for criminal prosecutions of those involved in the LIBOR manipulation.

  17. Pingback: LIBOR ANALYSIS: The hints of global fireworks in the FSA’s Barclays rationale | A diary of deception and distortion

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  19. Pingback: RATE-RIGGING: New toxic Tory links to Iswap – the Libor of derivatives trading | A diary of deception and distortion

  20. Pingback: John Ward – Rate-Rigging : New Toxic Tory Link To ISWAP – The Libor Of Derivatives Trading – Revealed : The Secrets Of Michael Spencer’s ISWAP, Michael Fallon, Page 19901,And Controversy About Derivative Rates – 10 July 2012

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