John Mann, an opposition Labour Party member of the U.K. Parliament’s Treasury Committee, attacked the inquiry into the Libor-rigging scandal as a “whitewash” after he was left off the panel.
A motion submitted to the House of Commons today named Andrew Tyrie, the Conservative lawmaker who heads the Treasury Committee, to lead the probe. Fellow Tory Mark Garnier, Labour’s Andy Love and Pat McFadden and Liberal Democrat John Thurso are the other members from the lower house. Mann said he and Tory Andrea Leadsom, a former Barclays Plc banker, should have been included.
“Because we are too outspoken we have been blocked,” Mann said in an e-mailed statement. “This exposes the inquiry as a total whitewash with Andrew Tyrie reaching his conclusions in advance of the meetings. We need to get to the bottom of this scandal and I’m therefore setting up my own inquiry into this dreadful mess.”
Barclays, the second-biggest U.K. bank, agreed last month to pay 290 million pounds ($448 million) in regulatory fines for rigging the London interbank offered rate, spurring the resignations of Chairman Marcus Agius, Chief Executive Officer Robert Diamond and Chief Operating Officer Jerry Del Missier. The U.K. Serious Fraud Office opened a criminal probe into Libor-rigging last week.
Unusually for a parliamentary committee, the Libor panel will be able to appoint a lawyer to question witnesses on its behalf and to question those witnesses under oath. It’s the result of a compromise between Prime Minister David Cameron’s Tory-led government and the Labour Party, which had called for a full judicial inquiry along the lines of the one currently looking into media standards under Judge Brian Leveson. The government rejected that as too time-consuming.
The panel, to be known as the Parliamentary Commission on Banking Standards, will look at “professional standards and culture of the U.K. banking sector, taking account of regulatory and competition investigations into the LIBOR rate-setting process,” as well as “lessons to be learned about corporate governance, transparency and conflicts of interest, and their implications for regulation and for government policy,” according to the wording of a motion published on Parliament’s website.
“The recent scandals demonstrate the need for higher standards in banking,” Tyrie said in an e-mailed statement. “The perpetrators of wrongdoing should be held fully accountable for their actions. It is the fact that so many appear to have got off scot-free that really sticks in the gullet of the electorate.”
The motion requires the inquiry, which will also include members of the upper, unelected House of Lords, to recommend legislative action by Dec. 18.
When Diamond testified before the Treasury Committee last week on Libor, Mann told the former Barclays CEO that his voters viewed him as running a “rotten, thieving bank” and suggested he give his recent annual bonuses to a homeless charity. “Either you were complicit in what was going on, or you were grossly negligent, or you were incompetent,” he said.
“Do you live in a parallel universe to the rest of the U.K.?” Leadsom asked Diamond during that hearing. “You say it’s the culture that saved Barclays, but it’s the culture that’s the problem.”