LIBOR (FSA Investigation)

Bob Blackman Excerpts

Thursday 28th June 2012 Commons Chamber

[Bob Blackman (Harrow East) (Con)]

It is clearly vital that we rebuild confidence in the banking system after this further scandal, but there are questions to ask about what compliance regime was going on in Barclays during the mid-2000s and in every other bank. Does my right hon. Friend agree that no matter what the regulations are, it is now vital that the banks come out with a clear, transparent and independent compliance regime to make sure that people who disobey the rules are caught very quickly?

[Mr Osborne]

My hon. Friend is right that the compliance regime is absolutely the first line of defence in the financial services industry. To be fair, Barclays did raise concerns about the LIBOR market operation in late 2007 and early 2008. I think that we can draw a distinction, as the FSA does, between what was going on in 2005-06 and early 2007 and what happened once the crisis hit. He is absolutely right that the compliance regime is vital, and if there are any banks listening to what has happened today that are not looking carefully at their compliance regimes and ensuring they are up to scratch, I think that they are being pretty foolish.