Chris Blackhurst: The Michael Spencer I know is utterly disgusted by what his traders got up to

His reaction to the Libor scandal was, in our conversation, one of fury and shock

Share

A confession: I’ve known Michael Spencer for years, and I like him a lot. I’ve dined with him at the offices of Icap, the broking firm he founded in the City, and at his club, George, in Mayfair. I’ve sampled wines from his splendid cellar. Only a few weeks ago, I was sailing with him and his partner, Sarah, the Marchioness of Milford Haven, family and friends, off the Isle of Wight.

On that trip, we discussed, among other things, politics – he’s a former Conservative treasurer and remains close to the party hierarchy; the economy and markets, naturally; his fitness and diet – subjects that all men of a certain age seem to ponder over these days; his love of Kenya, where he has a home. Did we talk about the Libor-rigging scandal and the case brought against Icap by UK and US regulators? Yes we did.

There will be readers of this who find all that nauseating. A journalist from The Independent hobnobbing with a super-rich Tory, wealthiest self-made man in the City! Oh my word.

The fact that Icap has been fined £55m by those regulators will only fuel their outrage. A journalist from The Independent fraternising with the boss of a company done for cheating! How utterly dreadful.

The impression I got that day from Spencer regarding Libor was one of shock. We did not talk about it in enormous detail but his anger at the way his company had been dragged into the global scam and its fallout was palpable.

Now, I’m also aware that Spencer is someone who has built his entire career and considerable fortune upon being spot-on, of immersing himself in the adrenalin and buzz of dealing. Even though he ascended to the gods at his organisation, and loved to entertain the great and good in his art-filled boardroom, he also liked nothing more than to wander the dealing floor, chatting to his traders. There was even a desk that was kept spare for him. Off would come the jacket, revealing his trademark red braces, and he would lean forward, intently scanning the flickering screens, listening to the numbers being shouted, the orders hurtling across.

In those moments, and I’ve been with Michael as he’s left the glasses of his favourite Pomerol behind and rolled up his sleeves, you see a different Spencer. The urbane, silky charm is replaced by a calculating machine, someone with a brain for numbers and a nose for a profitable opportunity.

So it’s hard for me to believe he did not know what his brokers were up to. But I also witnessed his fury at first-hand as we coursed along in the Solent. And I will say this: an upset Spencer is something to behold. He may be the son of a diplomat, and a brainbox of an astro-physicist from Oxford, but he can swear as colourfully as any man when it suits him. His face reddens, his eyes flash, his lips curl into a snarl and he lets rip. He certainly did that when I first mentioned the word Libor.

Of course, the cynics among you will immediately surmise he was displaying embarrassment at being caught, that the contrast between his staff fixing a figure that has profound influence across the world in the pricing of financial products and touches the lives of ordinary people, not just banks and institutions, and his position as a leading member of the City and political establishment was tough to bear.

That’s not how I read him. Spencer does not need to set his dealers loose on manipulating the sums in order to earn a bit of extra cash.

Icap may operate in the jungle of capital but it’s a respectable business, one that in recent years has grown extremely fond of its hegemony status – the most important day in Spencer’s year is his annual charity day when all Icap’s daily profits are donated to good causes. It’s become a fixture, with actors, sports stars, politicians from all persuasions and members of the Royal Family all manning the phones to clinch trades and make some money for the less fortunate.

He loves it, as he does, too, his membership of the Downing Street inner circle. There’s no way on earth he would risk those. Ah, I hear you say, we’ve been here before with the bankers who brought us down. I agree, hubris is never far away, especially where City greed and self-aggrandisement are concerned.

However, I’ve never sensed that with Spencer. What I have seen is that as he’s got older and grander, and more involved in politics, those visits to the trading floor have become less frequent. Some of his senior staff have changed; the eyes and ears monitoring the place might not be what they once were.

In his rage yesterday, Spencer said: “I deeply regret and condemn the actions of the three brokers [ex-Icap employees, now facing criminal charges]. It’s not a cultural problem. It’s a rotten apple situation here.”

I disagree. It is a cultural problem, but one that runs across the entire City and the world’s financial centres. The lack of morality that allows those rotten apples actually to flourish is the issue (and yes, regulators and management who fail to grasp what is going on, do not help). I may be wrong about Spencer. If so I apologise: he’s an even better actor than he is money-making genius.

The focus groups are happy – go ahead and screw the economy, Ed

If I was the Labour leadership I would keep my collective trap shut. No sooner does Ed Miliband announce a freeze in energy prices than the cat is out of the bag: apparently, explain the cognoscenti, it went down well in focus groups.

Blow me down. You sit around in a dusty hall somewhere; probably late at night with some people who will answer your questions in exchange for M&S sandwiches and a fiver, and they tell you they think not putting up the cost of gas and electricity is a good idea.

You see, I’ve done that trip. Many times, I’ve sat on the other side of the glass as folk have been led through their likes and dislikes. We’ve watched (and also munched crisps, sausage rolls and BLTs) as they’ve opened up.

Would the facilitator have gone on to ask them how Labour’s perceived anti-big-business stance would help the party in its fund-raising or make overseas companies want to come and set up shop here?

Were they quizzed on the fact that energy infrastructure projects will grind to a halt because energy firms can’t guarantee future profits and how did they feel about that? And, without those new power sources we could face blackouts and did that bother them? Or, if they had pensions, those retirement pots were almost certainly invested in the energy sector and were they happy to see those holdings suffer? And what signal did they suppose such a move would send to companies in the global, fiercely competitive world in which Britain is obliged to operate? Would they worry, for example if businesses thought Labour might freeze other prices as well?

Probably not. Possibly, that was because the questioner was anxious to move on and ask if they would vote for a government that gave away free chocolate and beer. How they answered was highly complex and sophisticated, and remains a closely guarded Labour secret. Don’t be surprised, though, if it’s in next year’s, pre-election conference tub-thumper from Milband.

React Now

Latest stories from i100
Have you tried new the Independent Digital Edition apps?
iJobs Job Widget
iJobs General

Selby Jennings: VP/SVP Credit Quant- NY- Investment Bank

Not specified: Selby Jennings: VP/SVP Credit Quant Top tier investment bank i...

Ashdown Group: Senior Marketing Executive- City of London, Old Street

£40000 - £43000 per annum + benefits: Ashdown Group: Senior Marketing Executiv...

Ashdown Group: Marketing Manager

£40000 - £43000 per annum + benefits: Ashdown Group: An international organisa...

Ashdown Group: Internal Recruiter -Rugby, Warwickshire

£25000 - £30000 per annum: Ashdown Group: Internal Recruiter -Rugby, Warwicksh...

Day In a Page

Read Next
 

Errors & Omissions: pours or pores, pulverised, ‘in preference for’ and lists

Guy Keleny
Ed Miliband created a crisis of confidence about himself within Labour when he forgot to mention the deficit in his party conference speech  

The political parties aren't all the same – which means 2015 will be a 'big-choice' election

Andrew Grice
Aren’t you glad you didn’t say that? The worst wince-and-look-away quotes of the year

Aren’t you glad you didn’t say that?

The worst wince-and-look-away quotes of the year
Hollande's vanity project is on a high-speed track to the middle of nowhere

Vanity project on a high-speed track to nowhere

France’s TGV network has become mired in controversy
Sports Quiz of the Year

Sports Quiz of the Year

So, how closely were you paying attention during 2014?
Alexander Armstrong on insulting Mary Berry, his love of 'Bargain Hunt', and life as a llama farmer

Alexander Armstrong on insulting Mary Berry and his love of 'Bargain Hunt'

From Armstrong and Miller to Pointless
Sanchez helps Gunners hold on after Giroud's moment of madness

Sanchez helps Gunners hold on

Olivier Giroud's moment of madness nearly costs them
A Christmas without hope: Fears grow in Gaza that the conflict with Israel will soon reignite

Christmas without hope

Gaza fears grow that conflict with Israel will soon reignite
After 150 years, you can finally visit the grisliest museum in the country

The 'Black Museum'

After 150 years, you can finally visit Britain's grisliest museum
No ho-ho-hos with Nick Frost's badass Santa

No ho-ho-hos with Nick Frost's badass Santa

Doctor Who Christmas Special TV review
Chilly Christmas: Swimmers take festive dip for charity

Chilly Christmas

Swimmers dive into freezing British waters for charity
Veterans' hostel 'overwhelmed by kindness' for festive dinner

Homeless Veterans appeal

In 2010, Sgt Gary Jamieson stepped on an IED in Afghanistan and lost his legs and an arm. He reveals what, and who, helped him to make a remarkable recovery
Isis in Iraq: Yazidi girls killing themselves to escape rape and imprisonment by militants

'Jilan killed herself in the bathroom. She cut her wrists and hanged herself'

Yazidi girls killing themselves to escape rape and imprisonment
Ed Balls interview: 'If I think about the deficit when I'm playing the piano, it all goes wrong'

Ed Balls interview

'If I think about the deficit when I'm playing the piano, it all goes wrong'
He's behind you, dude!

US stars in UK panto

From David Hasselhoff to Jerry Hall
Grace Dent's Christmas Quiz: What are you – a festive curmudgeon or top of the tree?

Grace Dent's Christmas Quiz

What are you – a festive curmudgeon or top of the tree?
Nasa planning to build cloud cities in airships above Venus

Nasa planning to build cloud cities in airships above Venus

Planet’s surface is inhospitable to humans but 30 miles above it is almost perfect