Osborne accused of linking innocent banks to scandal

 

George Osborne last night stood accused of being reckless when he wrongly named two major banks as being under investigation for the Libor rate-fixing scandal.

As Barclays' share price plunged more than 20 per cent after revelations of its involvement in the scandal, the Chancellor stood up in parliament and, in what appeared to be a scripted answer to a question from a Conservative MP, named four other banks being investigated in the UK.

The statement was made on Thursday, 24 hours after the Barclays fines were announced, giving the Chancellor plenty of time to get his facts right.

The Independent reported yesterday how HSBC was furious to have been named when it, in fact, was not being investigated by the UK authorities. Now it has emerged that one of the other banks Mr Osborne cited, Citigroup, is also not under investigation here.

The banks are particularly angry because the Treasury refuses to issue any sort of retraction. Instead, concerned investors and media have been told to contact the Financial Services Authority for "guidance" about the true state of affairs – that the pair are not subject to any investigation.

One banker told The Independent: "It is completely reckless in these febrile times that the Chancellor should completely wrongly name banks as being investigated for what could be criminal activity. Look at what happened to Barclays shares. The Chancellor should be completely upfront and admit he has made a mistake and clarify it."

The Treasury has refused requests from the banks to clarify the error, claiming the Chancellor did not specifically state that the banks were being investigated by the FSA.

But a Hansard transcript shows his statement was unambiguous: "HSBC and RBS are two of the banks under investigation, but international banks such as UBS and Citigroup are under investigation too, partly for activities conducted in this country," he said.

HSBC says it is not being investigated anywhere in the world, although it has, along with all other banks providing quotes for the Libor setters, been asked to supply certain documents. Citigroup declined to comment on investigations in other jurisdictions but is definitely not being probed in the UK.

The Treasury's refusal to clarify the situation puts the FSA in a difficult position: under its rules it is not allowed to publicly state whether firms are being investigated or not.

The fiasco has one silver lining: HSBC and the US-based Citi, can now boast of being the only two Libor panel members to have been cleared of wrongdoing by the regulator.

HSBC shares fell 15p to 558p on the day of the Chancellor's statement. It has since recovered to open this morning at 570.3p.

Suggested Topics
VIDEO
Have you tried new the Independent Digital Edition iPad app?
News
Plans to decriminalise non-payment of television licence fees would cost the BBC £500m according to estimates drawn up within the Corporation
people
News
people
Life & Style
The new low cost smartphone of Motorola, 'Motorola Moto G', is displayed in Sao Paulo, Brazil on November 13, 2013. The smartphone, with dimensions 65.9mm W x 129.9mm H x 6.0 - 11.6mm D is equipped with a Qualcomm Snapdragon 400 with quad-core 1,2 GHz CPU, a 4.5-inch display and Android Operating System 4.3 and a suggested price of $ 179 USD.
techData assessing smartphones has revealed tens of millions of phones are at risk of being harvested
Arts & Entertainment
Jessica Pare as Megan Draper and Jon Hamm as the troubled, melancholy Don Draper
tvAnd six other questions we hope Mad Men series seven will answer
Arts & Entertainment
Cody and Paul Walker pictured in 2003.
film
Independent
Travel Shop
the manor
Up to 70% off luxury travel
on city breaks Find out more
santorini
Up to 70% off luxury travel
on chic beach resorts Find out more
sardina foodie
Up to 70% off luxury travel
on country retreats Find out more
Have you tried new the Independent Digital Edition iPad app?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Online Advertising Account Executive , St Pauls , London

£26K-30k + Bonus, Private Medical Insurance, Company Pension: Charter Selectio...

Advertising Account Executive - Online, Central London

£25K-28k + Bonus, Private Medical Insurance, Company Pension: Charter Selectio...

Senior Infrastructure Consultant

£50000 - £65000 Per Annum potentially flexible for the right candidate: Clearw...

Public Sector Audit - Bristol

£38000 per annum + Benefits: Pro-Recruitment Group: Do you have experience of ...

Day In a Page

Homelessness: Why is the supported lodgings lifeline under threat?

Why is the supported lodgings lifeline under threat?

Zubairi Sentongo swapped poverty in Uganda for homelessness in Britain. But a YMCA scheme connected him with a couple offering warmth and shelter
A History of the First World War in 100 Moments: When the world’s biggest shed took over Regent’s Park

A History of the First World War in 100 Moments

When the world’s biggest shed took over Regent’s Park
The pain of IVF

The pain of IVF

As an Italian woman vows to keep the babies from someone else’s eggs, Julian Baggini ponders how the reality of childbirth is often messier than the natural ideal
Supersize art

Is big better? Britain's latest super-sized art

The Kelpies are the latest addition to a growing army of giant sculptures. But naysayers are asking what a pair of gigantic horse heads tells us about Falkirk?
James Dean: Back on the big screen

James Dean: Back on the big screen

As 'Rebel without a Cause' is re-released, Geoffrey Macnab reveals how its star perfected his moody act
Catch-22: How the cult classic was adapted for the stage

How a cult classic was adapted for the stage

More than half a century after it was published 'Catch-22' will make its British stage debut next week
10 best activity books for children

10 best activity books for children

Keep little ones busy this bank holiday with one of these creative, educational and fun books
Arsenal 3 West Ham United 1: Five things we learnt from the battle between the London sides

Five things we learnt from Arsenal's win over West Ham

Arsenal still in driving seat for Champions League spot and Carroll can make late charge into England’s World Cup squad
Copa del Rey final: Barcelona are paying for their complacency and not even victory over Real Madrid will put things right

Pete Jenson on the Copa del Rey final

Barcelona are paying for their complacency and not even victory over Real Madrid will put things right
Rafa to reign? Ten issues clay courts will serve up this season

Rafa to reign? Ten issues clay courts will serve up this season

With the tennis circus now rolling on to the slowest surface, Paul Newman highlights who'll be making the headlines – and why
Exclusive: NHS faces financial disaster in 2015 as politicians urged to find radical solution

NHS faces financial disaster in 2015

Politicians urged to find radical solution
Ukraine crisis: How spontaneous are the pro-Russian protests breaking out in Ukraine’s east?

Ukraine crisis

How spontaneous are the pro-Russian protests breaking out in Ukraine’s east?
A History of the First World War in 100 moments: The first execution at the Tower of London for 167 years

The first execution at the Tower of London for 167 years

A history of the First World War in 100 moments
Fires could turn Amazon rainforest into a desert as human activity and climate change threaten ‘lungs of the world’, says study

New threat to the Amazon rainforest:

Fires that scorch the ‘lungs of the Earth’
Liverpool, Chelsea and Manchester City: And the winner of this season’s Premier League title will be...

Who’s in box seat now? The winner of the title will be ...

Who is in best shape to take the Premier League prize?