January 7th, 2014

SKETCH: Head of the Parcel-Passers Gets a Pounding at TSC

Did he regret it? Andrew Tyrie had the regulator in of one of the bodies that is supposed to oversee the banking industry. This one is called the Financial Conduct Authority and seems to have been as useless if not more useless than any of the others. Its boss is called something or other, it doesn’t matter what, but he was the one who approved the appointment of the Rev Mr Flowers to the chair of the Co-op bank.

“I don’t think it was a mistake,” Reggie the Regulator said and kept saying, only adding, “given the information I had at the time.”

But why didn’t he have better information? Ah – well, no one had come forward with it. That had been “disappointing”, in his regulatory opinion. How about the conviction for “gross indecency”? That was not relevant. It was a spent conviction. Or then, his other criminal conviction for drink driving? Both involved, shall we say, risk-taking behaviour (John Mann). Gross indecency, drink driving, no experience of banking, no knowledge of financial services, interviewed for an hour and a half, no references taken up, no check as to whether the Co-op had taken up references, interviewed by two relatively junior officials of the Financial Services Authority . . .

“Didn’t that make any bells ring?” Pat Mcfadden asked

Not with the information the regulator had. And not for the work he was to do. You see, Flowers wasn’t to run the bank he was to run the board.

So, Tyrie rephrased the proposition, marvelling at its oddness, there was a large unruly board with two merged companies represented on it, and faced with a momentous decision that could (and would) wreck the bank and need a billion-pound-plus bail-out . . . the regulator’s solution was “to put a financial illiterate in charge of it?”

Reggie made a reply of some sort. Tyrie asked: “Do you now think that was regrettable?”

“At the time we did our job effectively.”

“How can you possibly say it was correct at the time?”

It was rubbish in/ rubbish out. It was box ticking. It was an elementary mistake. It was a negligent decision.

He certainly took a pounding. What will come of it – we will have to wait and see.

As Andrea Leadsome said “We’ve had witness after witness coming in here saying it wasn’t their fault, and you’re another one.”

The regulator said that the decision wasn’t flawed. The problem was that “the stress analysis crystallised”.

That defence deserves jail-time.

There is only one way that bankers are made to avoid unquantifiable risk: by making them bet with their own money. When they lose, their house goes, they move out beyond the ring road and their children are taken out of school. Maybe we can start including the regulators in this nice paradigm.


135 Comments

  1. 1
    Reggie the Regulator says:

    Fame at last

    Like

    • 6
      Morgan's Organ says:

      And who interviewed Reggie the Regulator?

      Like

      • 14
        Mr Potato Head says:

        And with one bound he was free. The state knows how to deal with their own. They do nothing. And so we all know it will all happen again and again. And next time it could be far worse.

        Like

        • 23
          Barclays Bank used to be run by Quakers says:

          “There is only one way that bankers are made to avoid unquantifiable risk: by making them bet with their own money. When they lose, their house goes, they move out beyond the ring road and their children are taken out of school. Maybe we can start including the regulators in this nice paradigm.”

          Very wise words in deed.

          Separate the casino merchant banks from the plain vanilla retail banks, otherwise it will all end in tears.

          Like

          • Mustafa Bung says:

            “they move out beyond the ring road”

            No, they are moved into an inner-city mozzed-up shiite hole.

            Like

          • Not My Job says:

            This is a story about four people named Everybody, Somebody, Anybody and Nobody. There was an important job to be done and Everybody was sure that Somebody would do it. Anybody could have done it, but Nobody did it. Somebody got upset about that, because it was Everybody’s job. Everybody thought Anybody could do it, but Nobody realized that Everybody wouldn’t do it. It ended up that Everybody blamed Somebody when Nobody did what Anybody could have.

            Like

          • FFS says:

            Won’t work. The vanilla banks will simply lend their deposits to the merchant banks. That was what led to Glass Steagal being repealed in the first place. It didn’t actually make any real sense. You can’t really say to a bank “You mustn’t make risky investments” in any sensible measurable way.

            Like

          • O blownTooth says:

            buy the TOWN and the C T is yours.

            Like

          • Richard Chimney says:

            It’s interesting – in some financial businesses – and I’m thinking of fund management here – investors are very keen to see principals with substantial amounts in the game (6 or 7 figure sums).

            Where you detach risk from potential reward then the problems start. Traders at banks are almost always playing with shareholder, bondholder and depositor cash not their own. Similarly all those sub-prime mortgage brokers in the US were motivated to write as many mortgages as possible as they took no risk that the mortgage was bad. Even the bank nominally providing the mortgage has little or no risk as the whole lot was securitised and sold on to third parties.

            Risk and reward need to be tied very closely together indeed in financial markets.

            Like

      • 127
        BRODERICK CRAWFIRD says:

        reggie s mum

        Like

    • 8
      Ariel Sharon says:

      Much appreciated – all the prayers and luv from Guido’s bum boys

      Like

    • 27
      King Jong-King-Kong says:

      Hitler and the socialist dream

      “He declared that ‘national socialism was based on Marx’ Socialists have always disowned him. But a new book insists that he was, at heart, a left-winger

      It is now clear beyond all reasonable doubt that Hitler and his associates believed they were socialists.”

      http://www.independent.co.uk/arts-entertainment/hitler-and-the-socialist-dream-1186455.html

      The Lost Literature of Socialism by George Watson is published by Lutterworth

      Like

      • 37
        Stupified says:

        No shit sherlock!

        The give-a-way was in their name NSDPA.

        Now go away and look up what the differenceis between socialists of the national and internation variety.

        Hint: One of them is kosher and the other isn’t. The non kosher variety is considered verboten by the west.

        Like

      • 130
        Never believe anything you find on Google (or anywhere else on-line) says:

        Just read this. A real eye-opener. I suggest also reading the Wikipaedia entry on Fischer – who postulated a continuity of German policy (Leibensraum and a combination of nationalism, racism and socialism) from Bismarck to Hitler. No wonder the left does not like the Gove attack on the Blackadder school of history.

        Like

      • 133
        the volunteer says:

        so ? are people saying that Hitler was a bad person ?

        Like

    • 116
      The Labour Party says:

      Shouldn’t he just be killed, like the producers at Channel 4?

      Like

  2. 2
    Jimmy says:

    “Or then, his other criminal conviction for drink driving? Both involved, shall we say, risk-taking behaviour”

    Good to see someone taking a stand on this.

    Like

    • 3
      Dutch Courage says:

      Nah. When he was pissed he didn’t know he was taking a risk.

      Like

      • 42
        LeftLoather says:

        Besides, the ketamine and cocaine made him feel fine.

        Like

      • 52
        (Not so)Dangerous Brian says:

        Or when he was high on crack, speed, blow, puff or paid for bum s*x.
        I still think poor old Rev Flowers got a raw deal, I mean he might even get thrown out of the church.

        Like

    • 68
      Keep Calm, Vote UKIP says:

      They are doing an excellent job with the smoke and mirrors around what was very clearly a very politically sensitive decision made on the part of Labour in the lead up to the 2010 election.

      The fly in the ointment, other than the drugged up loony that is Rev Flowers, was the record seat loss and overall loss at the General Election.

      Still makes you wonder what Flowers was getting up to with the Tory in the hotel room later that year at conference, other than some b/s about a Northern !rish bank.

      Anyhow, the mind boggles at how UKIP could do any worst if given a chance.

      In fact, it is not clear they could.

      Vote UKIP

      Like

      • 73
        Gooey Blob says:

        Ukip cannot win any seats. You might as well spoil your ballot paper.

        Like

        • 84
          Mr Potato Head says:

          The Greens couldn’t win any seats but they did.
          The SNP couldn’t win any seats but they ended up running Scotland.

          You might as well vote for what you believe in, unless of course you believe in allowing 75 million Islamic Turks entry into the UK – as Dave does.

          Like

          • Gooey Blob says:

            …or millions of Syrians as Nige does.

            Ukip’s votes aren’t concentrated in the way they are for the Greens, Lib Dems and others. They need about 30% to win a single seat. They’ll do well this year because the Euros are not a FPTP system and people understand that, but as always their support will melt away come the general election.

            Look at the history of the Ukip vote in Euro elections and the following GEs.

            Like

          • Universal Hiss says:

            The Whigs & the SDP are rubbish too.

            Don’t vote for them or else you’ll let the Liberals in.

            Like

        • 110
          Tory voter says:

          I didn’t spil my ballot papper, but Cameron shat all over it.

          Like

  3. 4
    Paul T Horgan says:

    I wait for the transcript.

    The Verde move was opposed by the two professional deputy chairmen who quit when they were overruled.

    This did not raise any red flags.

    The FSA were criminally negligent during their run.

    Like

    • 118
      Robert Owen says:

      +1000000 . Co-op investors might like to take learned counsellors opinion with a view to suing this regulator (sic) and others for failure to carry out their statutory obligations.

      Like

  4. 5
    altruism in industry says:

    the regulator’s solution was “to put a financial illiterate in charge of it?”

    big LOL there

    Like

  5. 7
    Savage Cuts says:

    Like

  6. 11
    Dirty ole Bugger says:

    That’s what I love about Guido’s blog. It is comedy first and foremost with politics second.

    You wouldn’t get that on some earnest lefty blog. Oh no, everything is so fucking serious to them.

    Like

    • 16
      Kipper Off says:

      He gave his hairdresser an OBE.
      He gave his hairdresser an OBE.
      He gave his hairdresser an OBE.
      He gave his hairdresser an OBE.

      Like

    • 18
      The Labour Party says:

      Hard working one nation families are struggling to pay their heating bills. The cost of living crisis created by Ed Miliband’s green taxes are no laughing matter.

      Like

      • 22
        Tim Yeo says:

        I’m laughing all the way to my offshore bank…

        Like

      • 74
        Dirty ole Bugger says:

        Yes, the level of taxation of the middle classes has made heating my home quite expensive. But I’m not sure voting for you is in my best interests given that you and your mates are the people that put me in this position.

        Like

  7. 13
    Holly says:

    Maybe if this had been heard in a court of law, instead of politicians the public would not feel so up against a system we can never beat.

    The bods asking the questions will of course pat each other on the back for asking such ‘relevant’ questions, publish their findings to the grateful voters, and we will be told to await some other enquiry, that will be published at some date in the distant future.

    A complete crock.

    Strange as this may sound what we need now are a few far right, anti Labour funding hedge-funder’s to REALLY put the wind up some folks….THEY know who they are.

    I but live in hope.

    Like

  8. 15
    South7eventh says:

    Andrew Tyrie also asked Reggie whether he would have appointed a person with no scientific knowledge and zero experience to oversee the nuclear power industry.

    Not quick on the uptake, Reggie said that he saw no problem in such an appointment. Tyrie was withering in his reply.

    ‘ I think we can draw our conclusions from that!’

    Like

    • 32
      Prince Rupert says:

      Nothing happens in these situations, but some body sat down with a shortlist and decided that Rev Flowers was the best man for the job. How did these people reach this decision, was it because he was happy with the bank throwing money at the labour Party, was it because he was so inept at this role that he would never know what was going on, or was it because the people making the decision were as useless as he was. Given the bank made a series of disasterous decisions they clearly were not up to the job. But then this appears to happen in all walks of life especially in the Public sector, and notably in anything connected to the Labour Party, such as Northern Rock, HBOS, RBS etc, all making decisons based on politics – Scottish Independence, or sitting in Labour heartlands. Its pathetic really, Reggie the Regulator should be sacked and give up his pension, but he wont. Remember the HMRC wonk who lost all our records to a scam, he retired and was then re-employed as a consultant, and kept his pension etc. He should have been sacked in disgrace, but the NEVER are, which is why we, the public, have NO faith or respect for the morons that manage this realm

      Like

  9. 28
    altruism in industry says:

    it’s a dilemma isn’t it ?
    we like to think we are in a democracy but we know it is the secret squirrels who are keeping us safe, thankfully they appear to be on our side.

    Like

  10. 33
    Madasafish says:

    Any competent person would have resigned in shame..

    Like

  11. 34
    Sir Humphrey says:

    “the stress analysis crystallised”. Totally meaningless, I love it.

    Like

  12. 36
    King Jong-King-Kong says:

    Gordon Brown had no experience of banking and no knowledge of financial services

    Like

    • 43
      A fuckety, fucked, fucked up economy says:

      Did it show?

      Like

    • 55
      FFS says:

      He did have a knowledge of the Great Depression. Thus he would know that a credit boom always leads to a serious recession.

      Like

    • 113
      John Bellingham says:

      That RBS bloke was a chartered accountant, not a banker and the CEO of HBOS learned his trade as a marketing man in the supermarket business.

      Like

  13. 39

    Bobs for the joys, innit?

    Like

  14. 44
    • 50
      • 57
        Dirty ole Bugger says:

        Ah bless. Give the girl a break.

        We will remind the fucked up little bitch of her mistake when she’s in the same position that Harriet Harman is now.

        Like

        • 71
          Fair Game principal... says:

          Nope – she deserves no break.

          She plays with fire, actually breaks the law, and worst, shills for the likes of Balls and Miliband, she should take her licks like a real woman and perhaps lock down her social media stuff and stay off the net for a few days.

          In the mean time, this episode could be a very valuable lesson for her, if she actually gives a damn.

          Like

          • Dirty ole Bugger says:

            Take her licks like a real woman?

            She’s only 17. Too young even for me. I’ll wait till she’s 21.

            Like

          • Fair Game principal... says:

            This is amusing.

            http://uk.linkedin.com/pub/jasmin-beckett/55/4a1/607

            She seems to have had work experience at Merseyside Police for a month back in 2010.

            And has worked for Virgin media for 2 months as an IT analyst last year.

            So, do Labour, Merseyside Police and Virgin all support incitement to harm C4 producers on Twitter ?

            If the police do not follow up any complaints, we now know why.

            Like

    • 60
      (Not so)Dangerous Brian says:

      Should have kept your dopey uninformed gob shut until the brain cell became engaged then!
      Dimwit.

      Like

    • 86
      JH34989342529345 says:

      I don’t really give a shit what some little lefty dimwit says on Twitter. It’s the hypocrisy infused histrionics when the boot is on the other foot that pisses me off.

      Have they decided which safe seat they are going to parachute her in to yet?

      Like

  15. 45
    Bonar Law says:

    Oops, Simon. Politically correct language again! You mean – the CHAIRMANSHIP of the Co-op Bank, not the “chair” of the bank.

    Like

    • 93
      Le Chaise or La Chaise? says:

      +1000

      I fall off mine in shudders every time somebody is referred to as a piece of furniture, antique or otherwise.

      Like

    • 96
      The MAN is GENETIC says:

      magnate hacks.
      positive or nagative.
      ski or skooze me.
      plus or minus. blood is in the air.
      KERl Gene Hacman lCHING

      Like

      • 119
        Jethro says:

        96
        rhubarb grows
        vertically.
        green or pink.
        never BLUE.
        rubbish spouted.
        endlessly.
        blush for minors. pus is in the air.
        itching for jean harlow.

        Like

  16. 46
    A Maimed Badger says:

    Which ever way you go with this one, an MBE for one’s own Barber… is politically stupid and will always be used to justify any future Cronyism.

    Like

  17. 53
    A Maimed Badger says:

    In short this Government has reduced Politics to the level of any Third World Country

    Like

  18. 54
    How ironic! Leftie says there's no law against being offended! says:

    Like

  19. 58
    Coco The Clown is hired to oversee the Co op Banks! Hoot! Hoot! says:

    Clive Adamson is the clown who hired Rev Flowers!

    http://www.telegraph.co.uk/finance/newsbysector/banksandfinance/10426206/Co-op-Bank-unlikely-to-make-a-profit-for-five-years.html

    But Coco the Clown hopes to bring this circus to profit in weeks!

    Like

    • 75
      Ed Balls, on future Co-Op profitability says:

      Too far, too fast !

      Like

    • 132
      Pdubya says:

      “Who hired Adamson?” seems to me as important as why Adamson hired Flowers.
      At the end of he day you need to know just how far up the food chain total fxxxing incompetence is still alive and kicking before you do anything about putting it right.

      Like

  20. 65
    Dirty ole Bugger says:

    Pre-tax income £60,000 per year

    Take home pay: £40,000 per year

    Benefits cap £26,000 per year

    So, basically what we are saying here is that if you spend 6 extra years in edcuation not being paid but running up uni debts of £40K you will in fact be £14,000 a year better off than someone not working at all.

    If I were you Jasmin love, I’d drop this uni & politics lark and get yourself up the duff. It’s a much better deal.

    Like

  21. 67
    altruism in industry says:

    I haven’t said yet how much I appreciate Simon’s informative posts, possibly due to shyness on my part but I would like to say ” well done and carry on”

    Like

  22. 88
    Banka says:

    It is not the Methodist Minister we are interested in – it is all the carpetbaggers who joined and left in between and what they were up to

    We are not so stupid as to be distracted by the “flowers” non-story –

    Did the carpetbaggers deliberately mis manage to allow the hedge funds to take over

    After all it was not so long ago carpetbaggers tried to privatise the co-op bank – and were stopped in court

    This is just the new method used – and I suspect Flowers was not involved – but close scrutiny of the actions of all those who came before – and conveniently left again very quickly will give us better answers as to who the real villians of the piece are

    And – why not – sieze their “fortunes” – and force the hedge funds back out and fill the big hole they left behind – time to transfer the money back from the carpet baggers into the co-op’s coffers

    Like

  23. 92
    Which one of you is this charming racist? says:

    Like

    • 128
      BRODERICK CRAWFORD says:

      IS THIS ANDROID FROM BENEFITS STREET ??

      Like

      • 129
        BRODERICK CRAWFORD says:

        IF HE S NOT THEN HE S WITHOOUT DOUBT FROM BREWERY STREET .

        PARACHUTE REGIMENT ?? YEAH RIGHT … LOOKS LIKE HE S JUST BEEN PARACHUTED IN FROM THE PLANET ZOG ON A 1950 S TIME WARP .

        WONDER HOW LONG PLOD WILL TAKE TO FABRICATE AN EXCUSE THAT HE IS IMPOSSIBLE TO PURSUE AS NO ONE HAS MADE A FORMAL
        COMPLAINT ?? …. AND THAT BRUSSELS WOULD NOT SANCTION AN ARRREST AS IT CONTRAVENES HIS EEEEEWMAN RIGHTS .. INNIT ?

        Like

  24. 94
    Steve In Fazakerly says:

    Ha ha ha ha ha…Just shows what a load of complete nonsense the FCA is.
    If they are meant to regulate conduct then they comprehensively failed in their primary task
    The whole bloody lot should resign now. In any other sphere of work they would be gone already with no golden handshake or pay off or pension. Fucking outrageous

    Like

  25. 97
    Fishy says:

    So what about the rest of the fraudulent banksters, LIBOR criminals, banker drug & terrorism money laundering and all their friendly financial deregulation mates.

    When FCA are they, the f–kers, going to jail !!

    Like

  26. 98
    Hopeless Ed Miliband says:

    Has anyone seen the price of vibrating bum-faced goats these days? It’s an insult to hard-working families everywhere!

    Like

    • 105
      Darth Vader says:

      Does anyone here have ANY idea how much a Death Star costs to build? Luke Skywalker blew up my Death Star not once, but TWICE! I can’t afford to build another one.

      Unless..

      I appeal to Ed Miliband to resolve the Empire’s cost of interplanetary extermination crisis by capping the price of Death Stars at no more than £200 (including VAT) for the first two years of his government.

      Like

  27. 100
    Finance guru says:

    Being in the industry, I know that the FCA requires us to see the unforseeable, know the unknowable and make enquiries we have no power to enquire about – one rule for them, one rule for us

    Like

  28. 106
    Sunderland is a Labour ghetto thats why its shyte says:

    This country is going to hell in a handcart and none of the Establishment give a fuck,the political class only see the scum that infest Benefit Street once in 5 years they dont live amongst them and dont understand the outrage by the white working class who play the game and do their best.If the Tories have any sense they will use this prgramme th highlight the need for RADICAL change now.

    Like

    • 112
      FFS says:

      Hmm white working class.

      Claiming benefits up to £26,000 plus minimum wage of £13,000, tax of £1000.

      Total income after tax: £38,000p.a. (equivalent to £57,000 before tax)

      I think I know who they are voting for. I also know who’s paying for those votes :-(

      Like

      • 125
        Universal Hiss says:

        Working Tax Benefit & Housing Benefit must be costing a fortune.

        Both distort the housing market & the labour market. Tax payers pay a huge subsidy to large employers & then to banks to prop up low wages & high housing costs.

        Utter madness.The market is not free but rigged to the largest benefit scroungers who were not seen on Benefits Street.

        & no I’m not a leftie.

        Like

  29. 111
    FFS says:

    I see Blowing Whistles has made so many anti-semitic comments on this blog I’m now being tempted with holidays to Israel.

    Like

  30. 126
    Clive Eveson says:

    Out of curiosity, how many MPs have any real experience of running a country ?
    The evidence strongly suggests that the answer is : none of them.

    Like

  31. 131
    An Actuary says:

    ‘There is only one way that bankers are made to avoid unquantifiable risk: by making them bet with their own money. When they lose, their house goes, they move out beyond the ring road and their children are taken out of school.’

    And if you believe that is ever going to happen…

    Like

  32. 134
    Displaced Brummie says:

    Crystallised? Quite!

    Like

  33. 135
    olden1936 says:

    Mr Flower’s currently media heralded unsuitability and lack of expert banking know-how is in part being held against his occupying the role of Coop bank chairman. Surely similar total lack of expertise applies to many top men and women (CEOs, and rapidly shuffled government cabinet ministers etc) Most of whom, to seem to appear to function in their appointed roles, must continuously rely on underlings’ guidance and knowledge.

    Like


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