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Labour calls for banker licences to fight scandals

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(Globalpost/GlobalPost)

LONDON (Reuters) - Britain should issue licences to bankers to help stamp out the kind of scandals that have hit the City of London in recent years, the opposition Labour party proposed on Tuesday.

Labour will seek to amend a banking reform bill in parliament to strengthen existing checks on people working in the financial services industry.

"The Libor rigging and mis-selling scandals were not the product of one or two rogue individuals but fundamental failures of standards within the banks - and we need to raise professional integrity with a stronger licensing power as a result," said Labour MP Chris Leslie.

Among other changes sought by Labour are the creation of a new financial crimes unit within the existing Serious Fraud Office and immunity for whistle-blowers who reveal bad behaviour by banks.

Labour also criticised the government's bank levy, a tax on banks' balance sheets, which it said had raised nearly 2 billion pounds less than intended since its introduction in 2011. The levy was expected to bring in 2.5 billion a year but has failed to do so because banks have been shedding assets to bolster their finances and meet tougher regulatory requirements.

The Treasury has said it will review the levy this year to make sure it is operating effectively.

A parliamentary committee is trying to change the culture of Britain's banking industry after scandals including the manipulation of Libor interest rates, the mis-selling of insurance products and the near collapse of several British banks in 2008 and 2009 which plunged the country into recession.

Measures to improve competition and to rein in risk-taking and proprietary trading are being considered.

Chancellor George Osborne has adopted a proposal put forward by the commission to "electrify" the ring fence retail operations from riskier investment banking activities.

Osborne does not have to implement proposals agreed by the commission which he created.

(Writing by William Schomberg and Matt Scuffham, editing by William Hardy)

http://www.globalpost.com/dispatch/news/thomson-reuters/130415/labour-calls-banker-licences-fight-scandals