Bank of England deputy governor 'must resign' for failure to reveal brother's Barclays role
The Bank of England's newly appointed deputy governor is facing calls to resign after she broke the Bank's code of conduct by failing to declare that her brother worked for Barclays.
In a letter to the Treasury Select Committee, Charlotte Hogg apologised for not formally disclosing that her brother, Quintin, was Barclays' group strategy director, which could conflict with her work on the Prudential Regulation Committee (PRC).
The correspondence was made public during a committee session with the chairman and the deputy chairman of the Court of the Bank of England, where it was revealed that Ms Hogg had not declared the family link on a number of occasions since joining the Bank as chief operating officer in 2013.
It included not stating her brother's position when she recently applied to the Treasury to become a deputy governor at the Bank.
It comes after Ms Hogg, who has been touted as a possible successor to Bank governor Mark Carney, told the Treasury committee at a hearing last week that she always declared areas of conflicts of interests and was compliant with all of the Bank's codes of conduct because she helped to write them.
The findings have prompted Treasury committee member John Mann to demand she steps down.
"It is simply incredible that such a senior person at the Bank of England has behaved in this manner," Mr Mann said.
"Last week Charlotte Hogg proudly told this committee that she actually wrote the Bank's code of conduct which she has now admitted to repeatedly breaking.
"Not only has she compromised her current position and the Bank of England itself but, more importantly, she has failed under the key principles of the Nolan standards in public life and she has no excuse for doing so.
"This is simply a question about standards in public life and in this regard she has failed and must resign."
Ms Hogg took up the role as deputy governor for markets and banking at the beginning of March, overseeing the Bank's balance sheet and sitting on the Monetary Policy Committee (MPC), the Financial Policy Committee (FPC), the PRC and the Court of the Bank of England.
The PRC has direct responsibility for regulating banks, including Barclays.
Her father is Douglas Hogg, the third Viscount Hailsham and a former cabinet minister, who came under fire for claiming more than £2,000 in expenses to have his moat cleared at Kettlethorpe Hall in Lincolnshire.
Her mother, Baroness Hogg, is chairman of the audit committee at the John Lewis Partnership and a non-executive board member at the Financial Conduct Authority (FCA).
In her letter to the committee, Ms Hogg wrote: "As Barclays Bank plc is regulated by the PRA, under the Bank's internal code of conduct and personal relationships policy I should have formally declared my brother's role when I first joined the Bank.
"I did not do so and I take full responsibility for this oversight. I have now added a full record of my brother's role in the Bank's HR systems.
"Regrettably, my oversight means that my oral evidence to the committee in this respect was not accurate. I write now to correct that evidence at the earliest opportunity and to place on record my sincere apologies to the committee."
When giving evidence to the committee last week, Ms Hogg said she would discuss with Mr Carney whether her brother's position at Barclays meant she should be recused from PRC meetings discussing the lender.
She had told the committee: ''I don't discuss work with him and he doesn't discuss it with me, we mostly talk about his children.''
Speaking to the committee on Tuesday, court chairman Anthony Habgood said Ms Hogg had made an "honest mistake", but admitted it was a "very serious breach" and he was "very concerned".
"She's clearly going to sit on the newly-formed PRC and such a relationship should be declared for obvious reasons," he said.
Focusing on when and how Ms Hogg should have made clear the connection, Mr Habgood said there would have been "two or three opportunities" to declare the potential conflict of interest since 2013.
However, Bradley Fried, deputy chairman of the court, did not think these lapses meant the job should be withdrawn from Ms Hogg, adding: "I definitely don't believe it is a hanging offence."
"I will make it very personal," he said.
"In Charlotte's case, I have (...) worked with her and I have seen an utterly distinctive candidate emerge and grow over a three-and-a-half-year period and this is out of character.
"Terribly unfortunate, very aggravating, very grumpy-inducing, but was it a grounds of rescission? I am struggling with that one."
Outside the Bank, Ms Hogg has held down jobs at Santander, consultancy giant McKinsey and financial information firm Experian.
Following the session, Andrew Tyrie MP, chairman of the Treasury committee, said: "The committee now needs to digest the evidence it has heard today, some of which has been a surprise to a number of us. It will offer a view after a period of reflection."