LIBOR: How both the BBA and the BIS publicly misled the World about the rate-fixing scam.

Angela Knight, Terry Smith, the BBC and the Guardian: why should we listen to any of them?

London is suddenly awash with people keen to give you their view on the LIBOR scandal, how it was always a truck out of control, how they always knew it was a cesspit, and how appalling it all is isn’t it? Large numbers of them are senior politicians (hypocrisy of the year frontrunner this one), some of them are media types who write on pink pages but didn’t bother until now to share with us their disgust…and some of them are those pundits pounced upon by the ignorant at the BBC and the Guardian once the news is in that strange distillery of information, the Public Domain.

There’s more than a little irony in this last area, because their normally self-publicising punditry has to somehow square the circle of being good at their jobs – that is, investment on behalf of clients – and being completely blind – that is, not noticing that Libor is variously a sham, a scam, a lie, and a tip-top hoodwinking practice fully approved by the British Bankers’ Association (BBA) to the point where the BBA serially lied about it in press releases stretching back five years.

One such pundit in recent days has been Terry Smith (above) of Fundsmith, a brand name suggesting Tel is not backward about coming forward. He’s a regular on Peston slots when Robert needs to suggest he’s up to speed – and was on Newsnight earlier this week as the Voice of Resistance to all those nasty bankers who’ve been manipulating Libor for years my goodness me what next.

Billing himself and his blog as ‘straight  talking’, shoot-from-the-hip Smith must therefore find his boardroom an interesting place at the moment, given his  most senior non-Exec figure of of respectability is none other than former BBA boss Angela Knight. (pictured)

Angela made a smart move two months ago, once the bubbling under Libor scandal was increasingly obviously not going to go away: she quit. Known as the Voice of the Banks, Knight is a vigorous defender of the City of London, a standpoint that is neither lofty nor safe at the minute. But to give her credit, Angie jumped ship just in time: otherwise she would today be trying to defend all those utterly mendacious press releases from the past.

In regularly explaining to us all why banker-bashing is a disgusting sport that should be banned immediately, Angela Knight was thus only conforming to type when she cancelled a banker bash last night….their Summer bash. She wrote everyone an email saying, ‘We believe that in the current circumstances it would be wrong to proceed with the reception on Wednesday evening. We regret the short notice but our industry needs to think long and hard about its collective behaviour and I am sure you understand this is not the time for such an event to take place. Regards, Angela Knight CBE, chief executive, British Bankers’ Association’.

Hat-tip to City AM for publishing the email. And yes, it is good to see Angela finally realising how she was duped over all those years when obviously she knew nothing at all about Libor cheating, her being a unimpeachable CBE. And former Conservative  MP.  Ooo-err. I do think more and more that this amusing Libor Party soubriquet may well catch on for the Tories.

But it does make you wonder why the BBC and Rolling Rusbridger are soaking up Terry Smith’s stuff, when the other side appears to be represented on Fundsmith’s board. Last March, for instance, the BBA, FSA, and Bank of England met to ‘discuss’ the Libor process. At the time, Angela Knight told the media that the review was part of “a normal reviewing process”. But that was probably a bit of a porkie, I think Ange – am I right?

Further back in time, asked by the Chairman of the House of Commons  Treasury Select Committee Chairman on 13th May 2008,  whether Libor “remains a relevant measurement”. (Hint-hint, nudge-wink etc), Angela Knight replied:

“LIBOR has stood the test of two decades….what Libor represents is the rate in the market, and that rate is fixed at 11 am every morning. The Libor rate has drifted up, but that does not mean that that is a problem with Libor. What it does is say this is what is happening in the market”.

But it wasn’t doing that was it, Angela? Did you mislead the Committee here? Or were you too incompetent as the head of the BBA to know it was already going on? Certainly, you sought to reassure and appease that committee, by adding:

“Libor is the rate at which a contributing bank would be prepared to borrow in the market [it wasn't]….we have a sticky market out there, so it is not surprising that the rates move in different ways to the way they did when conditions were more benign [and every bank is lying about their borrowing rate]….I can let you have all the graphs and the details with pleasure [because you won't understand which way to hold them up anyway]…..”

So just to sum up at 8 am GMT, 3rd July 2012: when it comes to bankers cheating (or helping the financial world out of a self-created mess), we cannot trust either of the last two Chancellors, the Bank of England, the CEO of Britain’s biggest bank, his Chairman, large donors to the Conservative Party, those who give evidence to select committees, or the British Bankers’ Association. And it may be a bit naive of the BBC and the Guardian to assume that straight-talking Terry Smith really does represent the put-upon ordinary investor. Or not. I couldn’t possible say for certain either way.

But surely we can trust the Bank for International Settlements? Er, not exactly, no:  In its March 2008 Quarterly Review, the Bank for International Settlements stated that “available data do not support the hypothesis that contributor banks manipulated their [LIBOR] quotes to profit from positions based on fixings.”

They knew nothing. They were duped. Others can’t remember, or say it was nothing to do with them. It’s rather like Hackgate II, really. Bit by bit, Britain’s traditional reputation for honesty, probity and a word given in public is being destroyed by politicians, bankers, the police, the judiciary, lawyers, Peers, nhs managers, pr consortia, professional bodies, accountants……the list drones on forever.

There is nobody the Citizens of this country can trust any more. Who will give that trust back to them?

Related: Why the Global political class lies in fear of the LIBOR scandal

45 thoughts on “LIBOR: How both the BBA and the BIS publicly misled the World about the rate-fixing scam.

  1. Bob’s quit – will he sing like a canary and tell everyone what we all suspect: manipulating it for Barclays profit is likely small beans vs manipulating it for bailouts and the “benefit” of the UK economy/BoE

  2. I was just wondering, is Fundsmith related in any way to Fundswell?
    http://www.google.co.uk/url?sa=t&rct=j&q=&esrc=s&frm=1&source=web&cd=1&ved=0CFMQFjAA&url=http%3A%2F%2Fwww.whatdotheyknow.com%2Frequest%2Fstaffordshire_child_abuse&ei=_5_yT7OBEoql0QXsse2vCQ&usg=AFQjCNH2FJFEmsk6SNZu-c-GHm1wL8Z7ug&sig2=By5eP7RG-2phE3VHsuofZg
    It’s a funny thing, but I cannot find any of the Hansard stuff on the Fundswell/Staffordshire Pindown institutional child abuse stuff online any more, it appears to have all been taken down.
    Anyway, I just wondered if it is related, because I do know that the secret family court cover up is linked in with the banking industry – the big law firms which are tied with the banking industry.

    • Barbara

      I usually start with Companies House (or the Dutch KvK) – and whilst you can find Fundsmith, there is no mention of any Fundswell. Usually a charity is registered as a business in some way. A bit like the South African parliament being registered as a company in Manhattan (!!)

      http://wck2.companieshouse.gov.uk/b963ed4dfe2997b927ab9e8250839faf/companysearch?disp=1&frfsh=1341312997&#result

      I will add that Google did come up with some search results for Pindown – but it was your blog that came up first. BTW did you check your security settings (where you can block search results for porn sites – I had that problem when researching how many men regularly use prostitues*, which turns out to be rather too many!). (*Even so, much more proper than abusing children in any manner).

  3. Does anybody else find it a touch ironic that for a while now people have been referring to Labour as Liebour, perhaps they didn’t know how close they were to the truth? Many a true word spoken in jest….
    All the honesty and integrity has long gone, it’s every scumbag for himself now.

      • Yes, but that is an American thing. I was referring to here in the UK where GB’s fingerprints are rumored to be all over this affair.

  4. So the boss has retired to his mansion in the country.
    How about reclaiming the millions he grabbed while he was running a Mafia-style enterprise?
    And all the other directors that voted each other huge salaries and bonuses?
    The whole rotten scam should be cleaned out and all bonuses reclaimed for those fraudulent years.

  5. Remember Pastor Gordon opening the Lehman building with the crook Fuld of Lehman’s at his side. Blair and Brown were in full knowledge of manipulation of a multitude of financial instruments since they cosied up to the “industry” after the death of Labour Leader John Smith in 1993/4

  6. I’d just like one of theses ‘Bankers’ to resign in disgust at the moral bankruptcy of their company and colleagues rather than ‘for the benefit of the industry and to draw a line under the issue’. Did I say ‘Bankers’?

  7. The whole system is corrupt and is rapidly spinning out of control (and unless something is doen and soon then there is going to be a revolution).

    While not condoning what happened last year in the riots we are jailing people for stealing bottles of water or cigarettes (quite rightly) then something must be done with these guys. We cannot rely on the US exercising its extradition treaty to get this sorted, problem is the rot goes all the way to the top.

    • God help us all if ever ther was a revolution in this country! That would give the Nato mercinaries exactly the excuse they are waiting for to step in and start shooting civilians, as they have done in other revolution put downs.

      • I agree. Our (and others’) arms manufacturers love a good war or insurrection. Sales improve when the hardware can be labelled “theatre proven”.

      • They don’t need bullets they are killing them off by more sinister means. Driving people to suicide. OR being complicit. NO stats sorry, not important enough to collate. But if you want to know how many people got fined for parking illegally just ask your local friendly council.

        The wankers – oops, sorry! – typo- Bankers used to be revered just like all professionals. Now the trash who ‘run’ these corporate organisations are high on sex, drugs, or/and drink, they need an income to facilitate their lifestyles, and they care not how they aquire it. If they were caught claiming £200.00 income support while not entitled, they would face 6 months in prison- depending on your status of course. AND to think damedcam called Jimmy Carr names for NOT doing anything illegal…

    • I wonder if any of you saw this rather disturbing comment in the DT yesterday or can shed any light on it :-

      “At 0930 this morning, in scenes reminiscent of Stasi East Germany, 2
      police cars and 4 policemen from Merseyside Police arrested British
      Constitution Group Chairman Roger Hayes at his Wirral home and drove
      away.
      The first his family heard of him was at 18:30 this evening via a
      telephone call from a Warder in Liverpool prison, to say that Roger had
      been tried and sentenced to prison.
      At no time were the family or any other members of the public informed of his arrest, and it is understood that he was tried in a secret court without a Jury.
      Denied the right to argue his case, denied the right to a Jury, denied the right for the public to see justice being done, Roger was imprisoned in the secretive gulag system that Britain has become in 2012. Roger’s “crime” is that he has been refusing to pay his Council tax, because along with other state taxes, a proportion of the tax revenue gathered is being sent to the European Union

      Contact the authorities on the numbers below to let them know others know what they’ve done , it could be any of us its only going to get worse if we don’t stop it.
      Merseyside Police Tel: 101 local or +44 (0)151 709 6010 in UK.
      Liverpool Prison Tel: +44 (0)151 530 4000
      Crimestoppers (UK only) Tel: 0800 555 111 “

    • the emperor asked the pirate how dare you rob my subjects, the pirate replied to the emperor , “i have one ship and I am called a pirate, you have 100 and they call you an Emperor”

      thievery and plunder is a monopoly of the rich and they do not want the common man from challenging it.

  8. “Britain’s traditional reputation for honesty”?
    Do come off it JW! That was always just a load of bollocks put out by the ruling classes to con the British people and foreigners. Britain has always been known by other countries as “Perfidious Albion”-and with good reason.
    But, of course, Britain obtained its Empire (for the benefit of the ruling class and big money-not the people) by bluff and “wordcraft”. We’re good at it-thats why we have such thriving creative industries. What most didn’t realise until recently was that finance was one of them!

      • Brilliant!
        I understand that another epithet was “Treasure Island”-used by the big retail chains (presumably of overseas origin) because of the huge margins which could be made.
        Under Blair/Brown naturally it became “Fantasy Island”. Still, the party was great, it’s just that the hangover is bloody awful and is going to last a long time!

    • Exactly so.
      Scratch off the veneer and underneath you will find
      a pirate.The word of of honour was only among gentlemen
      thieves.No even that’s gone.

  9. I would cut Terry Smith more slack than you give him. He is a maverick, definitely not part of the club (his accent excludes him) and knows the game of overcharging the client for rubbish is over. His product Fundsmith is simple, transparent, low charging, focused and better than average performance.

    As for Black Bob, good riddance. Let him go and enjoy his money in the US until called to account there. Maybe Bubba awaits! Are there any countries left where there is no extradition to the US? China, Russia maybe.

    Tucker has been favourite to succeed Merv. A bit alarming if the Draper is protecting him. We need new blood and a clean sheet at the Bank.

    Angie was a hopeless little airhead, out of her depth as you might expect from an MP who lost her seat. perhaps she can join her predecessor as head of the BBA who in lives Thailand most of the year. It’s a forgiving place. A nice little bar in Phuket for bankers on the run would suit her just fine. Angie could be the mama-san and as is common in such places there would be bar fines for the patrons. Think about it Angie, it’s a nice little earner and I have a friend who works as a consultant setting up these places in new territories. He was recently in Rangoon.

    • Angela was often interviewed on the Beeb, an empty suit if ever there was. The platitudes she came out with (presumably rehearsed in front of her City mentors) were so obviously vapid that even the ‘innocent’ Beeb occasionally challenged them, rattling her. Now of course we can all see what was going on. Another front person bites the dust… and not before time. PR as an activity should be treated with the utmost scepticism. The Beeb needs to be a bit more careful when swallowing.

    • I agree about Terry Smith, in fact he seems to be the finance equivalent of the Slog.
      With regard to Angela Knight, the attacks are rather like attacking a defending barrister. The views she puts forward are those of a trade organisation, of course they support the members, what else? Generally she put the points across well. Whether the points should have been accepted is for the regulator/politicians to answer!

      • I would draw a distinction between legal representation and the head of a trade association dedicated to spin.

    • Hi oldasiahand,

      I thend to agree with your assessment of Terry Smith. I fyou look at his history and the research published by his company, you’ll see he’s been in the bollocks deconstruction business longer than anybody, and was famously fired by UBS for his pains back in the day.

      Follow the ling & read the research. I offer one extract to whet your apetite.

      Capitalism needs to be reformed in ways which will:
       align rewards with success and not with failure;
       strengthen the role of shareholders; and, above all,
       provide a fairer deal for individuals, be they citizens,
      customers or employees.
       The new ‘killer app’ for the centre-right needs to be a
      determination to champion the individual over the collective
      and the corporate. This requires promoting freedom, and
      empowering the individual in relation both to the state and to
      corporate interests.
       Without such a programme, Britain will remain on course for
      economic and social decline.

      http://www.tullettprebon.com/strategyinsights/index.aspx

  10. The lid has been partly lifted on the cesspit that is British finance. Dodgy people have been skimming the wealth from UK and foreign unfortunates for decades and doing very, very well out of it for very marginal added value – except to themselves. ‘The customer comes last.’ The old canard about how they would leave to our enormous detriment if we tried to interfere with their ever greater percentages is now turned on its head. How can we get them to leave? What would we have to pay them to move to (ideally) Frankfurt or perhaps Singapore? The sooner we have the cesspit emptied and a complete new set of rules enforced on these chancers the better. Of course that will be difficult as they are hand in hand with the key politicians of both parties, but it has to be done. That does not mean that we can’t earn money from finance, but it does mean that we can’t earn money from crooked finance. That includes you, Sir Merv, with your stealth wealth redistribution and eerie silence in the face of an utterly incompetent FSA. And now another bout of currency debasement. The whole world of British financial institutions needs major reform, and I would start with PFI and the BoE.

  11. Ah, falling for the trap there, John. ““…. available data do not support the hypothesis that contributor banks manipulated their [LIBOR] quotes to profit from positions based on fixings.”

    They knew nothing. They were duped. Others can’t remember, or say it was nothing to do with them.”

    The statement, while it might have been mendacious, as that is the current assumption, did not say there had been no manipulation, they knew nothing or were duped. If you parse the sentence correctly all it says is that there is no evidence to show that if in fact any manipulation took place with the intention of profiting from fixings based positions. Should such have occurred it was pure happen-stance, or serendipity if you happened to be Barclays et al.

    Slime is so accurate a description of these people.

  12. Amusingly, even Eddie Mair lost his temper with the banking industry shill he was interviewing on Radio-4 PM last night. After a series of weasel word evasions from Mr. Banking-Apologist, culminating in some vague statement that the enquiry would bring changes (I guess he meant you to read that as ‘changes to the culture of banking’ but the tone of voice and general level of obfuscation throughout said he fervently hopes it’ll be otherwise), Eddie eventually snapped and sarcastically bit back, “What, like telling the truth?” – from the tone of voice, it was obvious that he was wishing that a suitable expletive could have been inserted before the word ‘truth’. At that point the interview was abruptly terminated!

    Seems even certain members of the BBC are getting tired of covering up for this pack of thieving, power-hungry ar*eholes! Waiting for the moment when some commentator does a quick mental comparison between the possible consequences of continued participation in the lies, how far he/she is willing to compromise their own morals to keep a set of sociopathic bas*ards in clover, and his / her current pay-grade. Ought to be interesting.

  13. Pingback: John Ward – LIBOR : How Both The BBA And The BIS Publicly Misled The World About The Rate-Fixing Scam – 3 July 2012 | Lucas 2012 Infos

  14. O/T but have you heard that Airbus Industries are re-locating part of their production to Mobile Alabama to take advantage of lower costs & no stroppy unions. They have obviously done their sums regarding the Euro/Eurozone, & find that the figures don’t add up.

  15. This a Gem…..according to the DT bob stated….
    “I am deeply disappointed that the impression created by the events announced last week about what Barclays and its people stand for could not be further from the truth.
    Is it a misquote or did he mean to say “I am deeply disappointed because…..” !!

  16. Pingback: BARCLAYS & The BoE: Del Missier resigns as web of deceit unravels | A diary of deception and distortion

  17. Pingback: John Ward – Barclays & THe BoE : Del Missier Resigns As Web Of Deceit Unravels Lie Upon Lie, Until Nobody Knows The Truth – 3 July 2012 | Lucas 2012 Infos

  18. Pingback: LIBOR: How both the BBA and the BIS publicly misled the World about the rate-fixing scam. [The Slog] « Mktgeist blog

  19. Nothing but greed,I think that everyone who has there grubbie little mites in the till of life should Go straight to gaol, blood sucking scum who like to think they are helping us poor working class nobodies by screwing us for all are worth,sack the lot,see how the dole works for them,will they be able to live on £119 aweek [ in my case 7 weeks] shame on everyone of them.

  20. Pingback: LIBOR SCAM: BBA head Knight is on the board of one of the biggest money brokers in the sector. | A diary of deception and distortion

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

  22. Pingback: John Ward – Libor Analysis : The Hints Of Global Fireworks In The FSA’s Barclays Rationale. Who Will Light The Bluetouch Paper? – 8 July 2012 | Lucas 2012 Infos

  23. Great article on the deception of all the top players in the banking scandal that is yet to release the stench. One of the big players was the previous CEO of the British Banker’s Association Angela Knight, CBE…. who now has surfaced as the CEO of Energy UK implementing her transferable skills of obfuscation on the public!
    Talk of revolving doors …. she should be fired from her current position and also be called to account publicly for her time at the BBA.

  24. Pingback: Merv’s Bank of Ingot-sales sings “No don’t stop the Carneyval” | A diary of deception and distortion

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