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Sir James Crosby resigns from the FSA

Sir James Crosby, the man at the heart of a HBOS whistleblower scandal and deputy chairman of the Financial Services Authority, has resigned.

Sir James, former chief executive of HBOS, has come under fire as a result of evidence revealed yesterday as part of a Treasury Select Committee session into the banking crisis.

During the hearing it emerged that Paul Moore, former head of group regulatory risk at HBOS, tried to alert Crosby to the fact that HBOS was growing too fast too quickly back in 2004.

As part of his written submission Moore alleged that his team were “subjected to threatening behaviour from executives” when they tried to warn HBOS bosses over the risks of reliance on wholesale funding and rapid expansion.

But as a result of the media storm that erupted from yesterday’s revelation, Sir James this morning made the decision to step down.

Speaking to Mortgage Strategy Online, Michael Bolton, former chief executive of edeus and former managing director of BM Solutions, says: “Sir James’ resignation isn’t a surprise because this is a man of integrity.

“He will have taken the decision to resign because he felt that it was the most appropriate thing to do.

“It was Sir James’ successor Andy Hornby that actually instilled a very dramatic sales culture at the bank.”

The FSA has confirmed the resignation in a statement which reads: “The FSA can confirm that specific allegations made by Paul Moore in December 2004 regarding the regulatory risk function at HBOS were fully investigated by KPMG, which concluded that the changes made by HBOS were appropriate.

“The chairman of the FSA will write to the chancellor of the exchequer by the end of today, setting out the details.

“Sir James Crosby has decided to resign from the board of the FSA, for the reasons he has set out in his public statement, and we would like to thank him for his very significant contribution to the FSA over the past few years.”


Marketwatch 09/02/2009

Swaps continued to edge back up last week. Three-month LIBOR is now 2.16%.

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