Bob Diamond, head of Barclays' investment banking business, was criticised by a Manhattan judge for an "evasive" performance on the witness stand yesterday as he defended the company's acquisition of Lehman Brothers.
In a bankruptcy court hearing last night, at which it was alleged Barclays misled the judge when it sought permission for the deal back in 2008, Mr Diamond was reprimanded for refusing to give straight answers and apparently contradicting testimony he had given under oath earlier in the case.
At one point, Judge Peck told the executive: "If [the attorney] asks for a yes or no answer, give him a yes or no answer. You are coming across as evasive." And later, overruling an objection from Barclays' lawyer, the judge added: "I think that this is a witness that needs to have the leash held tightly. We are dealing with a very sophisticated witness who has been examined at length in deposition and who seems not to be giving precisely the same answers now."
Mr Diamond spent four hours on the stand yesterday as the court heard an application to reopen the approval of the deal, in which Barclays acquired the bulk of Lehman's business in 2008, days after the firm collapsed at the height of the credit crisis. The bankruptcy trustee and the Lehman Brothers estate, representing creditors, is trying to wrest more money from Barclays.
At issue is whether the court was told all the details of the deal when it approved the transaction. Barclays booked a $2.3bn profit on the acquisition within months, and attorneys said it had only been possible because Barclays had insisted on a discount for certain assets or because it had inappropriately taken possession of cash that should have stayed with the Lehman estate.Reuse content