Cathy Jamieson MP, Labour’s Shadow Treasury Minister, has today written to Sajid Javid MP, Financial Secretary to the Treasury, after it was revealed that the European Commission has levied a record €1.7bn (£1.4bn) fine on five major banks including Deutsche Bank, where Mr Javid held senior positions, for colluding to fix benchmark rates.

The full text of the letter is below:

Dear Sajid

You will be aware of the announcement from the European Commission that a record €1.7bn (£1.4bn) fine is being levied on five major banks and a brokerage firm for colluding to fix crucial benchmark rates.

I understand that the fines relate to activities covering Yen Libor and Euribor and follow the fines by financial regulators in the UK and US for attempts to manipulate the key interest rates. It is of particular concern that the Commissioner has highlighted what he describes as “the collusion between banks who are supposed to be competing with each other".

I also understand that the Euribor investigation focused on the period between September 2005 and May 2008, that the settlement involved Barclays, Deutsche Bank, RBS and Société Générale, and that in relation to Yen Libor the banks involved are UBS, RBS, Deutsche Bank, Citigroup and JP Morgan.

It is of course in the public domain that prior to being elected as an MP, you held senior positions at Deutsche Bank during the period that the Commission’s investigations and findings cover.

Given your current role as Financial Secretary to the Treasury, and your former role as Economic Secretary to the Treasury, I am sure that you would wish to be open about any meetings and discussions that have taken place which relate to this issue.

With reference to the issues covered by the Commission’s findings, I would be grateful if you could advise:

a) Whether you were aware of any concerns relating to the issues covered by the Commission’s findings during your time at Deutsche Bank;
b) Whether any of those people implicated in the activities uncovered by the Commission were working in a group managed by you at Deutsche Bank;
c) What responsibility you had for Euro interest rate derivatives and Yen interest rate derivatives when you were working at Deutsche Bank;
d) When you were first made aware of concerns about Deutsche Bank’s alleged involvement in this collusion;
e) When you were first made aware of the Commission’s findings in relation to Deutsche Bank;
f) Whether you have subsequently been involved in any discussions, meetings or written communications with Deutsche Bank or any of the other banks involved in relation to the Commission’s investigation and findings;
g) The dates and details of any meetings, discussions and written correspondence in relation to the issues covered by the Commission’s findings that you have had in your role as a Minister.

Given that the Commissioner has indicated that more action may follow, can you also provide information on what written correspondence, discussions or meetings you have had on any current investigations.

I also note that the Commissioner has indicated that further investigations may take place regarding possible manipulation of foreign exchange markets. As you will recall I have already written to you regarding this matter, and raised issues in the recent discussion in the European Committee on benchmarking in financial services. It would be helpful if you were able to provide specific details of action that will be taken on this.

Yours sincerely

Cathy Jamieson MP
Kilmarnock & Loudoun