Barclays blew the whistle on Libor-fixing, hoping for a lighter sentence. This, clearly, has not gone well.
You'll get no sympathy for Bob Diamond from this corner – yesterday we were demanding that he should have already gone. He led the investment banking division right when it was fixing Libor and even if he didn't order or condone it, he certainly should have taken responsibility, instead of trying (and now failing) to push Agius off the cliff instead.
But one interesting thing strikes me about this whole mess: Barclays blew the whistle on Libor-fixing, hoping for a lighter sentence. This, clearly, has not gone well.
First, there was the $290 million fine, which is substantial but not consequential for a bank as big as Barclays. Other banks in the fullness of the inquiry would probably – in fact, will – pay up more. Barclays was expecting a minor hit to its balance sheet.
What it was not expecting, however, was that its self-serving act in fessing up would lead to the immolation of, first, its chairman and, then, its CEO. I expect the strategy devised when they decided to own up involved taking a little heat and then being forgotten as all the other banks were raked over the coals.
This has not happened. Barclays instead has become the focus of public and political anger – by coming out first, it has attracted all the opprobrium that has been stored up since the financial crisis began: fury at the way the City's actions have no consequence to itself, only to the wider economy; rage at bonuses; and a justified sense of grievance at the ability of banks to escape any sort of punishment which hurt.
So Barclays is getting what it deserves. But what does this mean for future whistleblowers? If they see that this is the price they have to pay, they may refrain from coming forward, leaving cartels unexposed. That would be an unfortunate consequence.