Wednesday 21 March 2018

Bank of England's Hogg admits code breach over Barclays link

Bank of England Deputy Governor Charlotte Hogg failed to disclose a family link to Barclays Plc when she was hired in 2013. Photo: Bloomberg
Bank of England Deputy Governor Charlotte Hogg failed to disclose a family link to Barclays Plc when she was hired in 2013. Photo: Bloomberg

Fergal O'Brien

Bank of England Deputy Governor Charlotte Hogg has found her appointment at the centre of controversy after she failed to disclose a family link to Barclays Plc - in breach of the bank's code of conduct.

Ms Hogg, who took over as the deputy in charge of markets and banking this month, revealed in a letter to the UK parliament's Treasury Select Committee that she didn't tell the BoE her brother worked for the bank when she was hired as chief operating officer in 2013.

She also didn't mention it in her application for deputy governor, a job that involves some supervision of UK financial institutions. The declaration was only made after her appointment, in a questionnaire she completed for the committee.

Hogg, daughter of former MP Douglas Hogg, said she takes "full responsibility for this oversight" and apologised for not giving accurate information at her appointment hearing last month.

Her family links dominated the hearing, which said that "steps must be taken" to avoid conflicts of interest.

The omission shines a spotlight on the BoE's own compliance processes. "We've gone from being concerned about Ms Hogg's error, to being concerned about the bank's response," said MP Jacob Rees-Mogg.

Last week, Hogg told MPs that she was "in compliance with all of our codes of conduct. I know that; I helped to write them". She also said it's a possibility that she would excuse herself from some discussions on Barclays. Her brother Quintin Hogg works as a director at Barclays Investment Bank.

The chairman and deputy chairman of the BoE's Court, its governing body, were grilled on the issue at a separate hearing yesterday, where they said it would be discussed, but tried to downplay the seriousness of the offence.

Deputy chairman Bradley Fried said it was an "unwilful act of omission". "I definitely don't believe it's a hanging offence," Fried told the select committee. "It's terribly unfortunate. It warrants grumpiness." "It was just an honest mistake," said Anthony Habgood, court chairman. Ms Hogg said in her letter that the chairman had acknowledged "no actual or potential conflict of interest has arisen".

However, with her new role giving her an expanded remit, she plans to discuss the issue with the BoE's MPC, Financial Policy Committee and Prudential Regulation Committee to allow them decide if further steps are necessary.

In 2015, controversy surrounded Gertjan Vlieghe's MPC appointment. The Brevan Howard Asset Management economist planned to retain rights to future payouts from the firm but later announced he'd sell his interest. (Bloomberg)

Irish Independent

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