Investors brand Barclays crisis triumph of 'mob rule'

 

Barclays last night expressed its deep frustration that it has been vilified over its role in the Libor-fixing scandal despite having spent almost £100m investigating its staff and co-operating fully with the authorities.

Scores of lawyers and specialist investigators have been poring over documents and phone calls during the three-year investigation, the company said ahead of the former chief executive Bob Diamond's testimony to MPs today.

The huge investigation was part of the reason why Barclays was praised by the authorities for its co-operation, it said.

"That co-operation has led to Barclays being the first to reach resolution of these issues," the bank said. "It is ironic that there has been such an intense focus on Barclays alone, caused by our being first to settle in the midst of an industry-wide global investigation."

That sense of frustration was mirrored elsewhere in the City, where many investors feel aggrieved that Mr Diamond has been hounded out of his position by what one described as a "witch hunt".

Ian Gordon, banking analyst at Investec, described Mr Diamond's departure as "mob rule", saying that he had been scapegoated despite the fact that many banks were involved in the scandal. He added: "Barclays has not been well-served for its co-operation with the regulators. The mob got its man."

The huge cost comes on top of the expected legal claims from investors and customers who believe they have been left out of pocket as a result of the scandal.

"In total, the bank has invested nearly £100m to ensure that no stone has been left unturned," the company said in its statement.

Barclays published the explosive fact that it had maintained extremely close contact with regulators regarding its Libor submissions. These included 13 with the FSA, 12 with the New York Federal Reserve and two with the Bank of England.

Barclays claims that while its investigations found serious shortcomings, its investigations prove it took pains to raise its concerns about Libor rates with regulators.

Barclays says that internal investigators have reviewed 22 million documents, one million audio files and conducted more than 75 interviews with staff.

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