Saturday, 14 February 2009

Shooting the messenger

I suppose nobody knows, yet, what the whole truth is in the case of the story about Paul Moore. He claims to have been warning HBOS bosses that they were taking too much risk with their lending – and that he was sacked as a result.

It appears that he was then replaced by someone with, putting the best possible gloss on it, significantly less expertise and experience in the field of risk management. One can only presume that the replacement then gave his bosses the answer that they wanted to hear, rather than one which they did not want.

It's an astonishing example of shooting the messenger – and of the way in which the herd mentality took control at the top level of our banks. 'Everyone else was making these investments, so they must be OK, and we must do it too' – even when clear evidence to the contrary was presented to them.

Very few people have been sacked (or resigned) over this debacle – and there is increasing evidence that those heads which did roll are simply being re-employed by their former competitors or as 'consultants'. Those still in post want to receive their bonuses anyway – rewards for failure. Does anyone really believe that any lessons have been learned?

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