Barclays fights to rebuild reputation with call to strike off rogue bankers
Bank calls for body to promote professional standards and a register of practitioners
Saturday 08 September 2012
Rogue bankers should face potential lifetime bans from the industry following mis-selling and the Libor rate-fixing scandal, according to Barclays Bank.
In its submission to the Parliamentary Commission on Banking Standards, which was leaked to Sky News, the bank's board called for a new body to oversee British banking which would "promote and develop professional standards across the industry, and to administer a new professional register which all staff who work within certain functions are required to sign".
Bankers who fail to adhere to the standards set should be struck off in the same way as failing doctors, potentially barring them from working in banking again. Such a tough stance would, according to Barclays' submission, bring "certainty and confidence to customers that they are being served by qualified and trustworthy professionals who are bound by a code of conduct".
This, the bank adds, would "strengthen and broaden" the existing system in which the Financial Services Authority, the City watchdog, licenses bank executives.
The FSA has the power to fine and ban senior executives but rarely does so. Crucially, the current regime does not apply further down the corporate ladder. Under Barclays' proposals, by contrast, rogue bankers in senior, middle and even lower-tier management could be liable.
The new body would be independent of the banking industry but would be funded by the major banks. The body could dovetail with the Financial Conduct Authority which will supersede the FSA next year. In addition, Barclays proposed an overhaul of the industry's professional qualifications better to promote "ethics, behaviour and leadership".
Barclays has been beset by scandal in recent months. The bank has appointed Antony Jenkins as its new chief executive after Bob Diamond was forced to step down following the Libor-fixing scandal.
In June, the bank was fined £290m for its part in the scandal. Separately, Barclays also faces a potential £450m bill for mis-selling complex financial products to small businesses and, like most of its high-street rivals, it is still picking up a huge bill for mis-selling payment protection insurance.
The Parliamentary Commission on Banking, chaired by Andrew Tyrie, was set up following the revelation that a host of banks had been manipulating the Libor rate, which is key to the cost of consumers' mortgages and loans. It is widely expected to report its findings by the end of the year.
Barclays told The Independent that it would not comment on the leak as this would be "disrespectful" to the parliamentary commission.
However, the contents of the submission tie in with a recent mood of self-flagellation amongst some of Britain's banks. On Thursday, the boss of Lloyds, Antonia Horta-Osorio, said the industry had been "complacent, non-customer-focused and inefficient" in recent years.
Lloyds, though, is itself under heavy scrutiny. It emerged last week that it had been referred to the FSA's enforcement and financial crime division over incentive schemes paid to sales staff.
A wider examination of such staff commission schemes released by the FSA on Wednesday found that 20 out of 22 financial firms had "features in their incentive schemes that increased the risk of mis-selling".
The FSA has promised to introduce tougher regulation to force banks to scrap such incentive schemes.
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