Barclays resignations send the right message
Bob Diamond, chief executive of British bank Barclays, resigned on Tuesday July 3, 2012, caving in to political pressure over a rate rigging scandal which may trigger criminal charges. (June 8, 2011) Credit: AFP/Getty Images
The satisfying thuds you keep hearing from the British bank Barclays are the sounds of heads rolling. You may not have recognized this noise right away because it is so very rare in banks on this side of the pond.
Barclays appears to have manipulated the crucial London Interbank Offered Rate, which may sound obscure but is used to set all kinds of other rates, including for consumer lending, on both sides of the Atlantic.
The bank agreed to pay $450 million to settle the LIBOR allegations with British and American regulators, but that hasn't quelled the scandal. So on Monday Marcus Agius, the bank's chairman, turned in his resignation. And this morning Barclays controversial chief executive, Robert E. Diamond Jr., resigned as well. Hard on his heels came the resignation of Jerry del Missier, the chief operating officer.
To an American, these resignations are shocking. The leading executives of our giant banks, after all, not only drove them into insolvency through reckless mortgage lending, but when the housing bubble they pumped up finally exploded, it nearly immolated the global economy. U.S. taxpayers had to bail out the lot of them. But I am not aware of any resignations on a par with those we've just seen from Barclays, whose foul misdeeds pale by comparison.
On the contrary, the leaders of top American banks lived to lobby another day, battling measures in Washington that might rein in their risk-taking--which of course is our risk-taking, since they are still too big to let fail.
Pictured Above: Barclays controversial chief executive Robert E. Diamond Jr.
