Bloomberg reports that Barclays’s interactions with the FSA were 'strained', Chairman Marcus Agius told a hearing of Parliament’s Treasury Committee today. As part of his evidence, Agius also released an April 10 letter from FSA Chairman Adair Turner in which the regulator expressed his concerns about 'pattern of behaviour' that questioned whether the bank could be trusted.
Diamond, who resigned last week after the lender was fined a record $450m for attempting to rig interest rates, told the committee July 4th that the FSA was 'specifically pleased' with the 'tone at the top'. Under repeated questioning, Diamond failed to mention the FSA’s criticisms about a series of transactions aimed to show the bank’s accounts in a more positive light.
'Barclays has a tendency continually to seek advantage from complex structures or favorable regulatory interpretations', Turner said in the letter, a copy of which Agius said he showed to Diamond. 'The net impact has clearly been unfavourable to the degree of external trust in Barclays’s approach to issues such as tax, regulation and accounting'.
Diamond, 60, said the FSA felt there were some 'cultural issues' that needed to be resolved at Barclays and didn’t mention the letter even when prompted by Andrew Tyrie, chairman of the committee.
'Diamond lied to the committee', David Ruffley, a committee member from the U.K.’s ruling Conservative Party, said at today’s hearing.
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image: © Lisamarie Babik