Former Barclays boss Bob Diamond told MPs he felt "physically ill" when he discovered traders at his bank were manipulating the inter-bank interest rates.
During a feisty session before the Treasury select committee on Wednesday, Diamond said he was "disappointed" and "so angry" over the scandal, but denied having any knowledge of the affair at the time.
The banker stood by his former bank, telling MPs he "loved" Barclays and that the scandal was the fault of just 14 people and did not reflect a wider cultural problem in the bank.
Diamond is estimated to have received £120m since joining Barclays' board in 2005. He took home nearly £18m in pay rewards last year.
But he was forced out of the bank on Tuesday after Barclays was fined for fixing the Libor lending rate against the rules.
MPs on the committee were left unimpressed by Diamond's admission that he only learned of what his traders were doing last month.
Tory David Ruffley said it was "quite difficult to believe" that Diamond was "completely oblivious to illegality" at the bank he ran.
Asked by Labour MP Andrew Love if he should give up share awards to reflect what had happen at the bank, Diamond replied: "That is a question for the board."
"I don't feel personally culpable but what I do feel is a strong sense of responsibility, a very strong sense that when we find mistakes, we recognise them, we are open about them," Diamond said.
Love said: "There has to be recognition in that final pay off of what went wrong."
Diamond also insisted on referring to the MPs by their first names and interrupting them, much to the irritation of Labour committee member Theresa Pearce who tweeted from the session: "Really annoying that Mr Diamond is using our first names. So rude".
The former Barclays man was also subject to intense questioning from Labour MP John Mann, who offered to tattoo Barclays' founding principles of 'honesty, integrity and plain dealing’ on Diamond's knuckles.
"You personally are involved, either by being complicit or by being incompetent," he said.
Mann suggested Diamond give up some of his millions to help fund charities to demonstrate he was truly sorry. An offer Diamond declined to take up.
Diamond also told the committee that Barclays feared it would be nationalised at the hight of the financial crisis and that his chief operating officer, Jerry del Missier, mistakenly assumed the Bank of England had instructed him to lower the bank's Libor rate.
Diamond said Bank of England deputy governor Paul Tucker relayed concerns from officials within government that Barclays' Libor rate was too high - which could be a sign of financial weakness at the bank.
He said: "Whitehall was told Barclays had the highest Libor. They would think we couldn't fund and must nationalise the bank."
But he insisted he did not feel any action had been requested. "I didn't feel it was an instruction," he said.
MPs are due to vote tomorrow on whether to hold a parliamentary inquiry, as proposed by David Cameron, or a judge-led inquiry as called for by Ed Miliband, in to what happend at Barclays and across the banking sector.
04/07/2012 17:11 BST
Diamond: "I know Barclays would still act the same way... to come out and be the first to correct it. But I worry that the impact of being first and the recation to the one firm that's out first outside of the industry contact doesn't create great incentive for others to come forward."
04/07/2012 17:08 BST
The hearing finishes
Bob Diamond concludes his testimony after an afternoon of tough if varied questioning.
04/07/2012 17:06 BST
Diamond "thankful" to be given opportunity to speak at hearing
Diamond: "When there are mistakes we admit them, we act on them and we show that actions have consequences."
04/07/2012 16:54 BST
Stewart Hosie - Why did Barclays not know it was fixing Libor?
Stewart Hosie says it's "difficult to believe" that Barclays staff knew that other banks were trying to fix Libor, but somehow they didn't have internal processes to spot that they themselves were doing it.
Bob Diamond once again tries to say it was a limited number of people. Andrew Tyrie butts in and says, "Yes, we know this."
Diamond eventually says "it's a completely different issue," Hosie says it's not a different issue at all.
Diamond looks pensive again - he's been fairly relaxed so far, even when John Mann grilled him.
"There were discussions between compliance and the FSA," Diamond says, insisting that this happened before the FSA probe began.
Hosie says that's tantamount to saying the FSA gave a "nod and wink", Diamond says what must have happened is that the FSA had a different interpretation of those meetings than they'd previously thought.
It gets messier and messier - pardon the pun.
04/07/2012 16:45 BST
MPs on the commitee are tweeting from the room...
@ tpearce003 :
Really annoying that Mr Diamond is using our first names. so rude
04/07/2012 16:35 BST
Jon Thurso MP - We haven't really made much progress here
The MP says if Diamond were a cricketer he'd be Geoffrey Boycott. "You've been at the crease for two and a half hours and I'm not sure we're any further forward."
04/07/2012 16:31 BST
Best gag of the afternoon on Twitter so far...
@ DCAJason :
BREAKING: CERN to smash Bob Diamond into Paul Tucker at incredible speed in hunt for elusive 'Truth' particle #diamond #Barclays
04/07/2012 16:30 BST
John Mann: "You must have been grossly incompetent, if not complicit in this"
The Labour MP asks Diamond: "Either you were implicit in what was going on, or you were negligent, or you were incompetent."
Bob Diamond says once they became aware they launched the investigation, there's no other way than answering the same question.
Mann is clearly finding it difficult to believe that a man paid so much could not have known. "You must have been grossly incompetent, if not complicit in this."
04/07/2012 16:27 BST
John Mann goes on the warpath
John Mann is incredulous - saying "it does appear strange to the outside world" that even those rate-setters who did not fix Libor did not report that they had been asked to.
You seem to have "seen nothing, known nothing, heard nothing, in that three-year period," says Mann.
Earlier John Mann offered to tattoo the original founding values of Barclays - Honesty, integrity, and plain dealing - onto Diamond's knuckles. It is a rare highlight in a session which lost its fizz about 20 mins ago.
04/07/2012 15:58 BST
Our Libor-setters "some of our most senior staff"
Diamond is trying to refute the assertion that some of those who did the rigging attempts were "hot-headed 20 to 30 year-olds"
He says those who set the rates were "some of our most senior staff" who had been with Barclays for more than 20 years.
What does this say about Barclays? Nothing good, really.