HBOS whistleblower claims Treasury evidence withheld

Paul Moore, the HBOS whistleblower, has accused the Financial Services Authority (FSA) and former HBOS directors of withholding details of his evidence from a parliamentary inquiry into the banking crisis.

Moore, the former head of regulatory risk at HBOS, said he is “mystified” that trivial delays led to an important tranche of his evidence never being used by MPs to quiz the FSA and former HBOS executives.

‘My evidence arrived just too late for it to be used to interview the FSA. How very convenient for them,” he said.

In an exclusive interview with Strategic Risk, Insurance Times’ sister publication, Moore raised key questions about the level of support organisations offer to their risk managers. He said this was at the heart of the financial crisis, and accused the authorities of failing to tackle the problem. “Most risk managers feel constrained to say what they need to,” he said.

“None of my allegations have actually been fully investigated by the Treasury Select Committee because none of the relevant parties (James Crosby, the FSA, the former chairman of HBOS Dennis Stevenson, nor Crosby’s successor Andy Hornby) have been cross examined by reference to my detailed evidence,” Moore added.

When he broke his silence in February this year, Moore claimed he was sacked in 2004 after he raised concerns that the bank was exposed to too much risk.

He submitted detailed evidence to the Treasury Select Committee, which was investigating the banking crisis. Moore’s explosive evidence forced the resignation of Sir James Crosby, deputy chairman of the Financial Services Authority and head of HBOS from 2001 to 2006.

Crosby said there was no substance to the allegations and that they were fully investigated by KPMG and the FSA.

Moore also called for a broad ranging independent judicial inquiry into the role of the government, regulators and banking executives in the financial crisis.

The FSA said Moore’s allegations about the regulatory risk function at HBOS were “fully investigated by KPMG and the FSA, which concluded that changes made by HBOS were appropriate”.

HBOS has dismissed Moore’s claims, pointing to an independent investigation by KPMG which concluded they were not substantiated.