James Moore: Bob got the job, no matter what could have been

  • @TheIndyBusiness

Outlook The controversy over Bob Diamond's appointment as the chief executive of Barclays is increasingly resembling a pantomime, with the Financial Services Authority and Barclays' outgoing chairman Marcus Agius cast in the role of an argumentative pair of ugly sisters.

Yesterday the Treasury Select Committee published another set of correspondence between its chairman, Andrew Tyrie, and Hector Sants, the chief executive of the FSA. Yes, it's time for another bout of "he said, she said, oh no he didn't, oh yes she did".

The letter wanted to make it clear that the regulator had raised concerns about Mr Diamond's appointment when it was being considered and had specifically mentioned the Libor interest-rate fixing investigation that ultimately resulted in £290m of fines for Barclays.

At a hearing of the committee Mr Agius said: "These matters... were not raised by the FSA at that time as casting doubt on his suitability as chief executive officer."

Mr Sants, however, stressed that he told Mr Agius at the time that the regulator's views could change.

Ah, but hang on a second. They "could" change, not "would" change. The FSA didn't want to "pre-judge" its own investigation. Or maybe it simply didn't want to "pre-judge" the reaction.

It is quite true that Mr Agius could have given a fuller explanation to the committee of what the correspondence had said, and what he had been told by Mr Sants. The decision of Mr Agius and his colleagues to appoint Mr Diamond is also something that looks increasingly questionable, based on all the evidence they had in front of them.

But – and this is the key point – the FSA could have formally objected to Mr Diamond's appointment. It didn't do so. None of this changes that fact.