Trust? It Has Gone

One of the incredible aspects of the LIBOR fixing scandal is that relatively junior members of bank staff were left to "fix"(?!) interest rates.

It would be really "nice" if we could trust people in life in general. However, let's face it, more often than not we can't.

Banking is of course even more important than "normal" life (that is easy to confirm: look how many normal lives have been ruined in the banking crisis that has now lasted for four years). Bankers therefore need to be less trusted than those in other walks of life. Banking is too important to rely on trust as a control mechanism.

There are tens of thousands of decent honest people working in banking BUT that is not the point. The UK Public - that's you and me, by the way - needs to see evidence of strict controls and rigorous independent audits where banking decisions are involved.

Of course, the issues in banking are wider than the fixing of LIBOR. There are other areas where "self reporting" by banks has in the past been thought to be acceptable. NOT ANY MORE. All figures submitted by banks for any purpose need to be independently reviewed and audited before acceptance.

The time for trust has gone. The time for proper controls and audit has arrived. No "ifs" or "buts" - the outcome of betrayed trust is too serious to contemplate.