Whatever Diamond says this afternoon, all The Slog’s suspicions about Libor manipulation have proved entirely justified
Note these past Slogsposts:
‘Bob Diamond’s accession to the post of blue touch-paper igniter [CEO of Barclays Group] is a done deal. And another nail in the Coalition’s coffin….As long as they continue to be appeased, bankers will never learn to sniff the public mood…’
‘A total of sixteen banks are being investigated, and sources in the US last night confirmed to The Slog, “What started as something half-hearted is now much more focused. I guess you could say the rumour here is that they [the regulators] are onto something pretty big”…..the authorities suspect that key traders [at Barcap] used Treasury information via the main branch dealing with the UK Treasury. At the time, the Barcap investment division was headed by the Barclays CEO today, Bob Diamond….the BBA said it observes “rigorous standards in our scrutiny and governance of the Libor mechanism, and work with the industry to ensure their continued full confidence in one of its most accurate and reliable benchmarks.” Many observers have grown wary, over the years, of strenuous denials using the words ‘rigorous standards’.’
‘The Libor panel is barely regulated and completely unelected. The panellists have come under increasing scrutiny from the victims of rigging scams, those who accuse them of leaking, and the legal/watchdog authorities. A plethora of lawsuits filed this year show investors accusing a number of banks represented on the Libor panel of distorting market prices by hiding the banks’ true borrowing costs since as early as 2007. (Bob Diamond’s Barclays is allegedly implicated in this).’
‘What started out eleven months ago as a commercial lawsuit against various European banks regarding alleged LIBOR rate manipulation has now turned into a criminal investigation by the US Justice Department. Banks thought to include Barclays Citigroup, HSBC , Royal Bank of Scotland and UBS are undergoing investigation at present.
The criminal aspect of the case was only revealed by Justice late yesterday GMT. It is part of a global investigation across the US, Japan, Canada and the UK….It was alleged by insiders at one institution this morning that Barclays “of all of them has been the least helpful to date”….The suspicion has always been that traders at the banks manipulated the Libor rate to create a windfall of tens of millions of dollars each when they faced very serious liquidity problems during the 2008 credit crunch. During the 2008 financial crisis, overnight Libor spiked – a sure sign banks were having trouble borrowing money. Markets drew confidence later on, when Libor rates began to drop. The Wall Street Journal had doubts about the veracity of that drop at the time….’
‘It could well be that the time has come for some noisy skeletons to walk out of the Westminster cupboard. An international investigation into the alleged 2008 Libor manipulation scandal has been necessary pretty much right from the start. Without wishing to seem too obvious here, that’s because what happened was internationallyarranged…However, much as I would love to lump every last kilo of smelly silage on the Diamond Geezer for this, it looks like even he was, on this occasion, merely a cog in a much bigger wheel….Following this morning’s Slogpost, this email content from an as yet uncorroborated but well-connected source: ‘During 2008/9 I worked at a major investment bank which was advising the office of the PM [Gordon Brown] with regard to the developing banking crisis. I was told that No.10 had been calling the UK banks and demanding that they manipulate LIBOR down, as his economics department had determined that if it rose too much it would trigger a recession and he was looking at re-election”…..for me, the case raises two massive questions:
1. Where did the LIBOR manipulation scam start?
2. Is this why Bob Diamond feels able to tell David Cameron and George Osborne to f**k off with such impunity?
Stay tuned: this is a developing story.’
This from today’s Daily Telegraph on the subject of Diamond Bob’s likely testimony:
‘The Deputy Governor of the Bank of England encouraged Barclays to try to lower interest rates after coming under pressure from senior members of the last Labour government, documents have disclosed.’
‘The Bank of England was not to blame for the rate-rigging scandal in the banking industry but those around Gordon Brown were “clearly involved”, George Osborne has said.’
The record shows that, from the start of the Libor Party, The Slog has been ahead of the game. The future’s in The Slog.