A report in last night’s Standard provides a worrying insight into the behaviour of the City’s richest traders.
The industry, which the ES describes as “a heady cocktail of testosterone and money” seems to be saturated with men living bohemian lifestyles, taking outlandish financial risks every day.
It is also reported that insider trading convictions increase during times of financial hardship.
The Standard’s Simon English reports:
These are guys - they are nearly all men - who are super-bright in one direction only and have an interest in two things: money and bawdy fun. Should they send a topless picture of their new girlfriend to the rest of the desk? Of course they should…
The latest Libor trader scam at Barclays (other banks will be punished later) has again thrown harsh light on a culture impervious to change.
So there’s a perpetual conflict between the banks’ desire to look like a solid, cautious organisation that has been around for centuries and the chance to make a buck now and now and now…
For some, literally everything, even the relationship they have with their wife, is a trade. Are you getting a good deal or not? Should you sell up?
An anonymous source told the paper:
“It’s a long, hard, slog to the top of the trading floor and it’s usually predicated on your behaviour on the way up – the strip clubs, the drinking, the schmoozing of other traders and brokers.
“Quite frankly, stock exchanges should be done electronically within pre-set and agreed limits and this dealing-room charade should be consigned to a footnote of history.
“Unfortunately, the bosses tolerate it. Mr Diamond was a product of the bond dealing world and the madness is so top-down and ingrained in the management that they have lost sight of what a bank is really there for.”
Though chief exec of broking house Tullett Prebon, Terry Smith, says blaming the culture is pointless:
“You just need to keep them away from retail banking and the ability to fix or manipulate rates or benchmarks. Blaming traders for being greedy and manipulative in these circumstances, where you put temptation in their way, is like putting a fox in charge of a hen coop and then expressing surprise about the outcome.”
David remains resistant to a full-scale judge-led banking inquiry due to costs, time scale and past criticisms of the ongoing Leveson Inquiry into press standards, while Ed Miliband continues to push for one.
As Left Foot Forward reported earlier today, the prime minister’s resistance was repeatedly challenged at PMQs:
“The Vickers Commission said this about a very important issue that has come out in the last two weeks, about the way in which high street banks have sold dodgy products to small businesses, they said that should never be allowed to happen again, but after lobbying by the banks, the government rejected this very basic recommendation of Vickers…
“Whenever these scandals happen, he is slow to act and he stands up for the wrong people. The question people are asking is who will act in the national interest rather than the party interest. His is a party bankrolled by the banks. If he fails to order a judge-led inquiry, people will come to one conclusion: he simply can’t act in the national interest.“
These revelations by the Evening Standard will surely indicate further the need for Cameron to call for an independent inquiry into possible corruption and misbehaviour in the banking industry.