HSBC boss Alan Thomson quits and bankers mutiny over jail threat
Top bankers are quitting the industry in protest at new rules which mean senior staff in failed banks could face jail unless they prove themselves innocent, with one HSBC boss leaving and another threatening to go yesterday.
Their actions prompted a swathe of bankers and lawyers to warn that plans to reverse the burden of proof treat the sector unfairly and could push out top talent.
“It is one of several things putting people off joining bank boards,” said a well-known senior banker who asked not to be named.
“You have to have a readiness for personal risk that is unmatched in other sectors. Over time, it will dilute the quality of bank boards, which is the opposite of what is needed.”
The new rules are designed to make it easier to hold individuals to account when a bank collapses – if senior staff cannot prove they acted to mitigate risks, then they could face prison.
But lawyers fear that reversing the burden of proof would not make for a fair system. “Regulators are saying, ‘if I cannot prove the case against you, you have to prove it to me, and P.S. I’m the judge’,” said Simon Morris from CML.
“There is no opportunity for an individual to prove their innocence until a tribunal, which is very major and expensive litigation.”
HSBC chairman Douglas Flint had said a “growing danger of disproportionate risk-aversion” was creeping in. And Lloyds’ boss Antonio Horta Osorio fears staff will focus more on creating evidence to prove they behaved properly, rather than serving customers.
Another bank source expressed sympathy for Thomson and Trueman: “Like a lot of people in banks, you can see why they would say, ‘I don’t want to risk it any further – I will just cash in my chips and move on’,” he said.
Source: cityam- HSBC boss Alan Thomson quits and bankers mutiny over jail threat
