Problems at the Co-op bank – not our fault says FCA

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The regulator who authorised Paul Flower’s appointment as chairman of the Co-operative Bank faced MPs on Tuesday and stood by the decision to sanction the now-disgraced Methodist minister Paul Flowers to take on the role.

Clive Adamson, currently head of supervision at the Financial Conduct Authority refused to concede that the appointment of Flowers – branded a “financial illiterate” by the Treasury Select Committee’s chairman Andrew Tyrie –  had been a mistake.

“I didn’t think it was a mistake given the information I had at the time,” said Adamson, when asked about the authorisation of Flowers.

“My view at the time was that Mr Flowers did have the competence to perform the role of non-executive chairman,” said Adamson.

Adamson left MP Mark Garnier “almost speechless” after admitting Flowers had been approved after an hour-and-a-half interview and without his references being taken up.  Flowers had disclosed a spent conviction for gross indecency from 1981 but it was not deemed relevant. “We had to be very careful not to draw inferences from people’s private lives into their professional lives,” said Adamson.

However, Adamson said that he had required two non-executive deputy chairmen to be appointed as Flowers had no experience of banking. (rotfl!! Haze)

“Today he wouldn’t be approved,” added Adamson, as the process is tougher and now requires financial services experience to chair a bank. (wow! Haze)

Adamson was also facing questions about the approval granted to Co-op to merge with Britannia Building Society in 2009 which is now blamed for much of the problems at the bank. Adamson said there was no political interference but had been support for the co-operative movement. (with supporters like Adamson who needs enemies? Haze)

The continued tenure of Graeme Hardie as a non-executive director on the Co-op board was also questioned after he took the role despite having been involved in approving Flowers’ position as chairman when he was an adviser to the regulator. (dontcha just love that revolving door – aye readers!?! – Haze)

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The Haze says:

Clive Adamson understands that the function of people in public life is to brazenly defend the stupid, the inexcusable, the indefensible and to admit nothing – ever.

Even by the lamentable standards of what must surely be one of the world’s most useless and catastrophically inept regulators this is a new low.