Bingham Report on BCCI: Labour calls on Governor to resign

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The Independent Online
LABOUR leaders last night accused the Prime Minister and the Governor of the Bank of England of refusing to accept responsibility for the failure to protect depositors against BCCI's 'gigantic fraud'.

Gordon Brown, the Shadow Chancellor, called for the resignation of Robin Leigh-Pemberton and said the Prime Minister must accept his share of the blame.

'The Prime Minister and the Treasury say they relied on the Bank,' he said. 'The Bank relied on Price Waterhouse. Price Waterhouse say they relied on BCCI.

'Therefore no one is accepting responsibility for the mistakes. Everyone - as usually happens in this Government - blames someone else.'

But, with John Major sitting by his side, Norman Lamont, the Chancellor, said the Prime Minister and other ministers had been cleared of all blame in Lord Bingham's report and he demanded an apology by Labour for the 'slurs' on Mr Major, who was Chancellor at the time. Lord Bingham had concluded: 'The conduct of Treasury officials and ministers is not in my view open to criticism in any respect.'

In a statement to the Commons the Chancellor said he accepted all the recommendations made by Lord Bingham, including legislation to give the Bank of England explicit powers to refuse or revoke authorisation of banks whose supervision is obstructed by a complex structure or by undue secrecy.

The Chancellor also rejected Labour demands for the Government to pay compensation to the thousands of depositors, including many Asian businessmen in Britain, as it had over the collapse of Barlow Clowes.

Keith Vaz, Labour MP for Leicester East, who has led the campaign for the victims, reminded the Chancellor he had said last July that if blame were attached to the Bank of England he would reconsider compensation.

Mr Lamont said: 'I think there is a very significant difference with Barlow Clowes. In that case there was not a compensation scheme in existence, whereas there is a scheme to protect the depositors in BCCI.'

Referring to Mr Leigh- Pemberton, he added: 'I do not believe it would be right to call for the resignation of the Governor of the Bank of England . . . I have every confidence in him.'