Mansion House speech: Chancellor George Osborne to announce jail terms for rate fixing
Andrew Grice has been Political Editor of The Independent since 1998. He was previously Political Editor of The Sunday Times, where he worked for 10 years, and he has been a Westminster-based journalist since 1982. His column, Inside Politics, appears in The Independent each Saturday.
Wednesday 11 June 2014
Tougher penalties, including jail sentences of up to seven years, will be extended to other parts of the financial services sector in an attempt to prevent more scandals.
George Osborne will announce that legislation brought in after the Libor inter-bank lending rate-rigging affair will also apply to the foreign exchange, commodities and fixed-income markets.
The Chancellor is worried about serious allegations of misconduct in these markets and wants to be “ahead of the curve” rather than react to events.
In his annual Mansion House speech to the City of London, Mr Osborne will say: “The integrity of the City matters to the economy of Britain. Markets here set the interest rates for people’s mortgages, the exchange rates for our exports and holidays, and the commodity prices for the goods we buy. I am going to deal with abuses, tackle the unacceptable behaviour of the few and ensure that markets are fair for the many who depend on them.”
After the Libor scandal, the Government brought in a new criminal offence of reckless misconduct for senior managers whose actions lead to bank failure with a maximum penalty of seven years jail and/or an unlimited fine.
Legislation will be finalised after a “fair and effective markets review” by the Treasury, Bank of England and Financial Conduct Authority, Mr Osborne will announce.
The Chancellor is expected to be upbeat about the economy while avoiding triumphalism.
David Cameron has told Conservative MPs that the economy and immigration hold the key to winning back the voters who defected to Ukip. He said the economy was a more important issue for these voters than Europe, and that the Tories had the policies to answer their concerns.
In a rebuke to Theresa May and Michael Gove, who have clashed over extremism in schools, the Prime Minister said the Tories did well when they avoided “distractions”, and stuck to the key issues.
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