THE alleged involvement of the Royal Bank of Scotland in the manipulation of Libor, a key bank interest rate affecting loans and mortgages, could be worse than that of Barclays, an MP claimed last night.
In June, Barclays was fined £290 million by UK and US regulators with chief executive Bob Diamond resigning the following month. Investigations are continuing.
Labour's John Mann, who sits on the Commons Treasury Committee, said City insiders had told him "RBS involvement in Libor manipulation may be noticeably worse than that of Barclays", and that Stephen Hester, RBS chief executive, had been "preparing the ground for bad news on Libor with a series of soft messages to the outside world".
Mr Mann's comments came as Tan Chi Min, a former RBS dealer, provided details on how traders at the Edinburgh-based institution tried to influence Libor.
According to court documents filed in Singapore, Mr Tan, who is suing RBS for wrongful dismissal, alleges minutes of his disciplinary meeting omitted details of conversations about how traders tried to influence RBS's interbank lending rate submissions. He sug-gested the bank's internal procedure in London appeared to mean that "any-one can change Libor".
RBS is disputing the allegations, saying Mr Tan was dismissed for gross mis-conduct and it followed its disciplinary policy in deciding to terminate his contract. It has already announced the dismissal of several employees in relation to its inquiries into its interbank rate setting.
At Westminster, Mr Mann, who represents Bassetlaw in Nottinghamshire, called on Chancellor George Osborne to confirm whether or not he had received any formal or informal briefings on the Libor issue. He said: "Either George Osborne is failing to run the Treasury properly or he is failing to tell Parliament what he knows."
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