News

July 31 2023

Delighted to be writing a column for Global Relay. My first one can be found here. 

No prizes for guessing that it’s about turning small problems into crises. Not on purpose, of course. But through indifference, delay and denial.

Extracts from a talk I gave on this topic can be seen here.

Enjoy!

July 25 2023

Scarcely a day went by in the Investigations Team I ran when we did not receive a request for information about a client’s affairs, trading or other matters from regulators, in the UK and overseas, occasionally the police and sometimes other authorities. And just as regularly we found ourselves informing those authorities that we could only provide this information if they made a request under some legislative requirement or court order, if they had forgotten to do this, because the bank owed a duty of confidentiality to its clients which could only be overridden in certain very clear specified circumstances. And, no, this is urgent / we’re the SEC / do we really have to? / the client won’t know or complain etc., were not those circumstances. Amazingly enough.

Sod’s Law being what it is, if you did forget to insist on this requirement, it would almost certainly happen in the case of a client who would find out and complain. Loudly.

Sod’s Law also having a sense of humour, we come to the story of NatWest, its CEO, Dame Alison Rose, Simon Jack, the BBC’s Business Editor and the case of Mr Farage’s closed account.

There really are only two important things to know about banks. The first is that their job consists of managing risk. The second is that banking confidentiality is at the heart of their obligations to their clients. NatWest, especially in its previous Royal Bank of Scotland incarnation, gave us quite the masterclass for many years in how not to manage risk. Just as that has almost faded from memory (or seems only to afflict Swiss banks – for this was the week Credit Suisse was fined £87 million for “extremely serious” faults “symptomatic of an unsound risk culture”) up pops NatWest to show us how to make a hash of client confidentiality obligations.

Dame Alison Rose has admitted she spoke to Simon Jack at a dinner and was the source of the information he gave the next day about the reasons why the bank had decided to close Mr Farage’s account. She admits this was “a serious error of judgment.”

There are some curious aspects to her explanation.

• The story was already in the public domain but she seems to have had no prepared answer in the event she was asked anything. Presumably her office knew journalists would (or might) be there and maybe also the seating plan. Was there no briefing?
• She thought the information she was giving was already public knowledge. Famously journalists are always asking questions about stuff they already know.
• She says that she was not fully aware of the reasons for the decision as this was taken by others. This may well be true. But then, if you don’t know the full story, why say anything? How hard would it have been, really, to say to Mr Jack, when he asked: “You will understand that I cannot say anything. Mmm, this soufflé is delicious.“

It is all too true that, as I recently pointed out here – “If you employ humans, someone somewhere will be doing something stupid. And some of them will be quite senior.” But they are not usually that senior. Well, not always.

It is now for the Board to decide what to do. And the regulators. They might care to remind themselves how the Board of Barclays dealt with its (now ex) CEO, Jes Staley when he got into trouble over a whistleblower. I wrote about it here. The FCA might also remind themselves. It was not – for the reasons set out here – either of their finest hours. They might remind themselves that it will now be their judgment which will be scrutinised.

Meanwhile any CEOs meeting with journalists should remember the words of this song ….. “You say it best when you say nothing at all“.

Photo by Alicja Ziajowska on Unsplash

June 12 2023

Sexual harassment: Boorish behaviour, unwanted by the target. Not to be confused with flirtation or courtship. Often perpetrated by people who have not recently looked in a mirror or who have forgotten their age or marital status.

Code of Conduct: Having some manners.

Banter: Amusing social interaction between friends and/or colleagues. Not to be confused with bad or offensive language, which becomes “banter” when someone complains about it.

Witch-hunt: The process of making grown-ups accountable for their behaviour.

A kangaroo court: any tribunal, committee or other body which decides something which the person under investigation disagrees with.

Addiction: Bad behaviour turned into an “illness”.

A clinic: A place where “addicts” go to, to hide from the media.

Abuse of power: Bullying. Soon to be classified as an “addiction”

Inappropriate: Very popular word covering –

(1) Breaches of social etiquette, such as using fish knives to eat steaks.
(2) Language mistakes e.g. the use of “disinterested” to mean “uninterested”.
(3) Behaviour previously described as “wrong” or “illegal” or “criminal”.

Wrong: Description of behaviour which is either illegal or known by a majority to fall below widely accepted standards of decency. Implies responsibility by the person doing it. Now in high danger of falling into disuse.

Apology:

(1) A short form of words by which a person says sorry for behaviour which is “wrong” (see above). Traditionally starts with the 1st person singular and ends with the word “sorry”. In danger of falling into disuse.

(2) A long form of words by which someone appears to apologise while not in fact doing so. The non-apology apology requires focus on the victim’s reaction while also implying that it is both overegged and may not have happened.

There are many variations of this. Industries where bad behaviour is widespread are fond of adding to their apologies (variant no. (2)) a lengthy reference to all the good people in the industry; see Banking, Parliament, the Police, Journalism.

(3) The “Will this implausible excuse do?” apology: used by sulky teenagers everywhere. Now spreading to adults who should know better. See Diane Abbott who thought that saying offensive comments in a first draft was an adequate explanation rather than revelatory of what a person really thinks.

(4) Other popular excuses and explanations:

• “The culture has changed” – “I can’t get away with this anymore.”
• “What might have been acceptable 10, 15 years ago” – “My lawyer drafted this.”
• “Parliament / the police / the CBI / [insert organisation of choice] now needs to look at itself” – “Will this go away if we set up an inquiry and sack someone?”
• “Conduct needs to be improved” – “We must make sure not to get caught again.”
• “I have fallen below the high standards that we require of the [insert organisation of choice] – “By the time anyone works out what this means this unfortunate affair will have been forgotten.”
• “We take this [insert misconduct du jour] extremely seriously” – “We do now, given that it is all over the press and social media.”
• “I have reflected on my position” – “My wife / the PM / the Chief Whip has been shouting at me all weekend.”

The time for apologies is over (©Bob Diamond): The time when apologies (see “Apology (1))” should start.

Clarification: either

• an admission that what you said before was completely untrue (in common parlance, a lie); or
• an insistence that what you are saying now is what you have been saying all along, even though it is the complete opposite.

Shame: No known contemporary definition. Last heard of in the 1960’s.

Offence, the taking of: the best way of avoiding a debate and/or revealing you have no arguments. It is not actually necessary to be offended, just to say that you are.

“We are going to consult on these proposals” – “We know they aren’t popular but we’re going to implement them anyway.”

“We have not been consulted” – “We have not been agreed with”

“Let me be clear” – “I’m going to be anything but.”

“Full and frank disclosure” – “We don’t think they’ve got any more dirt than has already been published but are keeping our fingers crossed that nothing else comes out.”

Any statement saying that an entity’s finances are fine and intended to reassure: usually the precursor to discovery of a fraud or insolvency.

An inquiry: A process by which an embarrassing story disappears from public view.

A report: What a person who had nothing to with the original events has to present to Parliament and/or the media many years later. See the Savile Inquiry Report. See also the forthcoming Grenfell, Post Office, blood contamination and Covid-19 reports.

Lawyers: The people who write inquiry reports. Also, the only people who read them.

Peerage: what the author of a report producing a satisfactory outcome for those commissioning it gets, entirely coincidentally, after the report has been finished. Very occasionally, the peerage is given, again entirely coincidentally, immediately before the report is started (see Ms – now Baroness – Chakrabarti).

Conclusions:  Usually written before the inquiry has heard any evidence.

Recommendations: What you find, if you read that far, at the end of a report.

“We are going to consult on these recommendations ” – “We have no intention of implementing them but this will make it look as if we are doing something until everyone has forgotten about them.”

Working group: A group of people unable to avoid being tasked with the responsibility of coming up with suggestions as to how recommendations might be implemented.

The long grass: Where recommendations usually end up. See also “Inquiry”.

Lack of resources: The best reason yet invented for not implementing any difficult recommendations.

Lessons learned: Lessons which are never learned by those who need to learn them.

“This must never happen again” – “This must never happen again during my term of office, at least not before I resign/retire and draw my gold-plated, index-linked, final salary pension, or move onto an even more well-paid position.”

Whistleblowing: Something which is frequently talked about but not done anything like often enough. The equivalent of an “extreme sport” in some professions e.g. medicine, politics, finance.

Photo by Brett Jordan on Unsplash