It’s becoming difficult to predict just when the period of remorse and apology for bankers really will be over. Bob Diamond claimed that it had finished in January 2011, and found to his cost this summer that this was not true.
The Libor scandal that cost the Barclays boss his job wasn’t the only unpleasant thing to crawl out of what Vince Cable described as the ‘cesspit’ in the City of London, though. Today Standard Chartered’s shares fell by 16 per cent following allegations from US regulators that the bank had covered up £160bn worth of transactions with the Iranian government. And at Southwark Crown Court this morning, Jessica Harper, head of fraud and security for digital banking at Lloyds bank admitted a £2.4 million fraud.
In his City AM column this morning, Allister Heath points to fears that the ‘US has it in for the UK and that it is now trying to put the City back in its place’. The problem with these endless revelations of wrongdoing from London’s banks (and don’t forget, we haven’t heard the last of the Libor scandal, either) is that it leaves the door open for an attack on the City itself by international rivals: Paris, New York and Frankfurt would all love a piece of the City’s success and its appeal to professionals at the top of their game.
Fraser argued last month that we need a minister to defend the City and point out that it houses more than just bankers and rotten practices. As we discover more and more about what lurked in the ‘cesspit’, the case for someone to protect our financial centre from international power grabs grows.