Time for Tough Questions on Rates-Rigging and Banking Reform

Four years on from the financial crisis and a year since the Vickers Commission reported and there's no evidence that the worst culture and practices in banking have changed.

Four years on from the financial crisis and a year since the Vickers Commission reported and there's no evidence that the worst culture and practices in banking have changed.

Consumers have clearly had enough. Four in five (83%) of people we asked said they haven't seen any improvement in UK banks over the last year and two-thirds (66%) aren't confident that the government will act in consumers' best interests when implementing banking reform.

It's no wonder that consumer trust has been badly shaken when banks and bankers continue to be untouchable and fines only represent a tiny proportion of their revenue. It will take more than the resignation of Bob Diamond at Barclays to restore consumer trust in the banking industry.

Now is the time for tough questions. The public rightly deserve an answer as soon as possible as to whether retail banking customers lost money because of the LIBOR rates-rigging. The parliamentary inquiry must provide full disclosure including how widespread it was, who was involved, and importantly how consumers have been affected. However, we don't want the inquiry to hold up reform - there must be no excuses, no further delay in taking action to fix our broken banking system.

The banks have proven they can not manage change themselves. We want urgent and immediate action to put trust and ethics back into the banking system. For a start, we're calling for the banking sector to be referred to the Competition Commission to address the stranglehold this small number of powerful players has on our current accounts, loans, savings and mortgages. This is key if we are going to see any meaningful change in the culture of British banking and make customers the number one priority again.

The government should also start implementing the ring-fence between retail and investment banking as soon as practicable, and not wait until the banks' preferred date of 2019. And we'd like to see a new professional standards body imposed on the banking industry, with individuals required to comply with a code of conduct like the medical profession, and individuals struck off for malpractice.

But enforcement and reform alone are not enough. The fines handed down to banks are not a deterrent. Last week Barclays was fined less than £60 million in the UK, compared to £231 million in the US, and has paid out £2 billion in compensation and settlements in the last three years, but that seems to have little effect. The majority of people we polled think that if banks have broken the law the individuals involved should be prosecuted. So we're please that the Serious Fraud Office is looking at this.

It's also vital that the regulator is a tougher watchdog. The new Financial Conduct Authority (FCA) must be given the power to stand up to the banks and promote greater competition in a market that is dominated by a handful of big players.

This week we will be putting more pressure on the government and the Financial Services Authority to tell consumers whether they have suffered financially from the Libor interest rates-fixing scandal. If people have lost out, the government must make sure the banks put this right.

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