Bank and FCA end probe into HBOS bankers with no action
Officials said that they had decided not to take any enforcement action against senior managers.
Your support helps us to tell the story
From reproductive rights to climate change to Big Tech, The Independent is on the ground when the story is developing. Whether it's investigating the financials of Elon Musk's pro-Trump PAC or producing our latest documentary, 'The A Word', which shines a light on the American women fighting for reproductive rights, we know how important it is to parse out the facts from the messaging.
At such a critical moment in US history, we need reporters on the ground. Your donation allows us to keep sending journalists to speak to both sides of the story.
The Independent is trusted by Americans across the entire political spectrum. And unlike many other quality news outlets, we choose not to lock Americans out of our reporting and analysis with paywalls. We believe quality journalism should be available to everyone, paid for by those who can afford it.
Your support makes all the difference.The regulators that were criticised for taking seven years to start investigating former bosses at failed bank HBOS have decided to do nothing after investigating those bosses for another seven years.
Officials said that they had decided not to take any enforcement action against senior managers who were criticised for the bank’s failure in a 2015 report.
The Bank of England would not reveal if it had concluded that there was no wrongdoing, or simply lacked the evidence to prove anything wrong.
The Bank’s Prudential Regulation Authority (PRA) and the Financial Conduct Authority (FCA) said they had combed through evidence since launching the probe in January 2016.
“The authorities conducted rigorous and forensic investigations.
“Evidence was gathered in order to assess whether or not each individual may lack fitness and propriety to hold certain senior roles within the financial services industry in the future,” they said in a joint statement.
“In the course of these investigations, the authorities gathered more than two million documents, interviewed former HBOS senior managers, engaged extensively with the parties, and undertook substantial analysis of contemporaneous documentary evidence considering those senior managers’ roles and responsibilities at HBOS prior to its failure in 2008.”
They added: “In line with standard practice, the authorities’ independent decision-makers reviewed the matters under investigation and have each determined that no enforcement action should be taken against these former HBOS senior managers.
“These investigations have therefore been closed.”
The probe had been launched after a critical 2015 report into the conduct of the Financial Services Authority, the body that was later replaced by the FCA and the PRA.
The report, by Andrew Green QC, criticised as “materially flawed” the FSA’s decision not to investigate 10 former managers, including chief executives James Crosby and Andy Hornby and chairman Lord Stevenson.
Mr Crosby had once been the deputy chairman of the FSA.
HBOS was given a £20 billion bailout and had to be rescued by Lloyds TSB during the height of the financial crisis, after racking up £45 billion in bad debts.
The 2015 report blamed a lot of the bank’s problems on its strategy and business model, which focused on growth without considering the risks.
The FSA only took action against one HBOS executive, head of corporate lending Peter Cummings, after the crisis.