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Banking & Finance sector does something so naughty they need legal help

Posted by: Laurence Simons 23/07/12

New inquiry, same as the old inquiry

It is hard to remember those days, those halcyon days, where not everything in the world was an inquiry: when we didn't ask questions, when men called Lord Leveson didn't sit in a room for literally months summoning celebrities to come and yam on at him about the press, when banks had carte blanche. It was about four years ago, and it was great.

Well, not any more. With the whole Libor scandal — in brief: Barclays was fined in June for attempted manipulation of the London Interbank Offer Rate (LIBOR), to the tune of $200 million by the Commodity Futures Trading Commission and £59.5 million by the FSA — inquiries are being launched left, right, and centre. And with those inquiries comes the need for those in in-house legal jobs to swoop in like a tired mum and say "shh" and smooth things over.

And the particular legal firms who have been called in to say "shh" and smooth things over in the case of the upcoming Libor investigation were announced this week. Freshfields Bruckhaus Deringer (Freshfields) will represent the Bank of England, while Morrison & Foerster & We Should've Thought About This Contraction Before We Went and Printed the Headed Paper (MoFo) will represent former Barclays chief Jerry del Missier.

This, according to Legal Week, was always going to happen, seeing as Freshfields and the BoE are buds. It's not just a raft of key mandates (such as the £50 billion liquidity support programme introduced to the UK lending market in 2008) that are a result of their palling around: they lend each other neighbourly cups of sugar in the form of veteran partners such as Graham Nicholson, who became chief legal adviser to the bank back in 2009 and has never looked back.

Aw. It's nice when huge, towering corporations with massive turnovers become buddies. But perhaps Freshfields might want to turn the BoE from a 'friend' to a 'friend with benefits', and have them take a gander at the company's latest financial returns: as figures published earlier this month proved, the firm witnessed a dip in turnover that saw it slip behind Allen & Overy in the top 50 rankings for the first time ever.