At the height of the banking crisis in 2008, I took a phone call from one of the people closely involved in the banks’ rescue.
He pleaded with me to opine in print that Lloyds must be allowed to merge with the beleaguered HBOS and that the government must pump taxpayer money into HBOS. My source said it would trigger an economic tsunami if the institutions were allow to fail.
When I asked for evidence, he said it was common sense and promptly rang off.
That is where, by an large, the justice system has left the Global Financial Crisis, a mega event that was stunningly seen as axiomatic, rather than as a calamity for which the main actors should have been held responsible.
I was reminded of this exchange when the news surfaced — slipped out more like, on the eve of a long holiday weekend — that City watchdogs have concluded that no prosecutions will be brought against the former bosses of HBOS over its near collapse in 2008.
You may think that 14 years is a long wait. That might tell you something about the enthusiasm of the beaks, in the form of the Bank of England and Financial Conduct Authority, or FCA, to get involved.
In fact, this inquiry took six years. It was set to conclude in 2017, having been launched in 2016, but then the authorities discovered a cache of previously unexamined material.
In all, they had to go through a further two million documents before reaching a verdict of no action against those who presided over a fast-growth strategy in which the bank lent like crazy and ran up bad debts of £45 billion before being bailed out by the taxpayer to the tune of £20bn and being taken over by Lloyds.
The truth is that the 2016 investigation only began because the Bank and FCA were forced into action. They’d previously looked at HBOS’s failings and decided in 2015 that “ultimate responsibility for the failure of HBOS rests with its board”.
Despite this stark finding, they decided against bringing prosecutions.
It was only when a separate report by Andrew Green QC, also released in 2015, found that public interest decreed actions against the bank’s ex-chiefs be reconsidered that they reluctantly began their latest scrutiny.
Mr Green has described the earlier decision not to pursue the executive board directors — including chairman Lord Stevenson, former finance chief Mike Ellis and ex-chief executive Andy Hornby — as “materially flawed”.
The Bank and FCA said: “Independent decision-makers reviewed the matters under investigation and have each determined that no enforcement action should be taken against these former HBOS senior managers. These investigations have therefore been closed.”
The 2015 report had described a boardroom that lacked banking experience and a management team that drove a culture of growth at all costs. It said the bank “failed to set an appropriate strategy and also failed to challenge a flawed business model that placed inappropriate reliance on continuous growth without due regard to the risks involved”.
However, after “rigorous and forensic investigations”, after gathering more than two million documents, interviewing former bank managers, and undertaking “substantial analysis” of the bosses’ roles and responsibilities at what was then the country’s biggest mortgage lender and savings institution, the outcome is no further action.
This means that only one HBOS executive — former head of the commercial lending arm Peter Cummings — has ever been punished over what happened. Mr Cummings was barred from working in the City again and fined £500,000 in September 2012.
The logical extension of this is to suppose that Mr Cummings acted entirely alone — which, of course, is ludicrous. Certainly, he is entitled to feel more than a little angry over his apparent scapegoating.
What was the “too big to fail” argument, so eloquently explained to me above, spilt over into “too big to jail”.
No senior banker anywhere stood trial, let alone went to prison, for bringing the world’s financial services industry to its knees, for forcing governments to mount lifeboat operations that cost several billions of pounds and for causing a global recession with the loss of untold numbers of jobs, not to mention the infliction of misery on countless people, sparking mental and stress-related health issues.
HBOS was a shocking, basket-case of a bank. As well as the growth and lending policy, its Reading branch, which specialised in the rescue of small businesses, was at the centre of an enormous fraud.
Tens of smaller business customers were ruined between 2003 and 2007 when corrupt bankers conspired with so-called turnaround consultants to loot the businesses that had been placed in the bank’s “high risk” unit.
The scheme's discovery did lead to the conviction and jailing of six people. But they were not at the top and again, there is the sense of a prevailing attitude of sweeping things under the carpet rather than pursuing the bosses.
A whistleblower, Sally Masterton, was forced out in 2015 after writing a report that was critical of the bank’s handling of the Reading affair. Lloyds eventually apologised, paid her compensation and admitted she had acted with “integrity and good faith”.
In 2012, as I detail in my new book Too Big To Jail, HSBC was fined a record $1.9bn for enabling the laundering of money by the Sinaloa Mexican drugs cartel, headed by the notorious Joaquin “El Chapo” Guzman.
As much as $1.9bn was, it amounted to only five weeks of HSBC profits. Under the Deferred Prosecution Agreement, reached with the US Department of Justice, HSBC agreed to pay the sum and to undergo a six-year reform programme.
The HSBC bankers were pursuing a high-growth strategy — sound familiar? Warnings about what was unravelling in Mexico were simply ignored.
Make no mistake, the Americans wanted to prosecute, partly because they were acutely aware that no senior banker had been indicted over 2008. But the UK government, in the form of George Osborne, who was chancellor at the time, and the Treasury intervened, maintaining that indictments and possible convictions jeopardised the bank and with that the edifice of the banking system.
No evidence was offered for this assertion. The upshot, and this latest news from the Bank and FCA affirms this, is that bankers are somehow above and beyond. Fining them has minimal effect; what they understand and dread is the prospect of personal ruin, of prison.
To date, they have nothing to fear.
Chris Blackhurst is author of Too Big To Jail — Inside HSBC, the Mexican drug cartels and the greatest banking scandal of the century (Macmillan).
The Melbourne Mercer Global Pension Index
The Melbourne Mercer Global Pension Index
Mazen Abukhater, principal and actuary at global consultancy Mercer, Middle East, says the company’s Melbourne Mercer Global Pension Index - which benchmarks 34 pension schemes across the globe to assess their adequacy, sustainability and integrity - included Saudi Arabia for the first time this year to offer a glimpse into the region.
The index highlighted fundamental issues for all 34 countries, such as a rapid ageing population and a low growth / low interest environment putting pressure on expected returns. It also highlighted the increasing popularity around the world of defined contribution schemes.
“Average life expectancy has been increasing by about three years every 10 years. Someone born in 1947 is expected to live until 85 whereas someone born in 2007 is expected to live to 103,” Mr Abukhater told the Mena Pensions Conference.
“Are our systems equipped to handle these kind of life expectancies in the future? If so many people retire at 60, they are going to be in retirement for 43 years – so we need to adapt our retirement age to our changing life expectancy.”
Saudi Arabia came in the middle of Mercer’s ranking with a score of 58.9. The report said the country's index could be raised by improving the minimum level of support for the poorest aged individuals and increasing the labour force participation rate at older ages as life expectancies rise.
Mr Abukhater said the challenges of an ageing population, increased life expectancy and some individuals relying solely on their government for financial support in their retirement years will put the system under strain.
“To relieve that pressure, governments need to consider whether it is time to switch to a defined contribution scheme so that individuals can supplement their own future with the help of government support,” he said.
Ten tax points to be aware of in 2026
1. Domestic VAT refund amendments: request your refund within five years
If a business does not apply for the refund on time, they lose their credit.
2. E-invoicing in the UAE
Businesses should continue preparing for the implementation of e-invoicing in the UAE, with 2026 a preparation and transition period ahead of phased mandatory adoption.
3. More tax audits
Tax authorities are increasingly using data already available across multiple filings to identify audit risks.
4. More beneficial VAT and excise tax penalty regime
Tax disputes are expected to become more frequent and more structured, with clearer administrative objection and appeal processes. The UAE has adopted a new penalty regime for VAT and excise disputes, which now mirrors the penalty regime for corporate tax.
5. Greater emphasis on statutory audit
There is a greater need for the accuracy of financial statements. The International Financial Reporting Standards standards need to be strictly adhered to and, as a result, the quality of the audits will need to increase.
6. Further transfer pricing enforcement
Transfer pricing enforcement, which refers to the practice of establishing prices for internal transactions between related entities, is expected to broaden in scope. The UAE will shortly open the possibility to negotiate advance pricing agreements, or essentially rulings for transfer pricing purposes.
7. Limited time periods for audits
Recent amendments also introduce a default five-year limitation period for tax audits and assessments, subject to specific statutory exceptions. While the standard audit and assessment period is five years, this may be extended to up to 15 years in cases involving fraud or tax evasion.
8. Pillar 2 implementation
Many multinational groups will begin to feel the practical effect of the Domestic Minimum Top-Up Tax (DMTT), the UAE's implementation of the OECD’s global minimum tax under Pillar 2. While the rules apply for financial years starting on or after January 1, 2025, it is 2026 that marks the transition to an operational phase.
9. Reduced compliance obligations for imported goods and services
Businesses that apply the reverse-charge mechanism for VAT purposes in the UAE may benefit from reduced compliance obligations.
10. Substance and CbC reporting focus
Tax authorities are expected to continue strengthening the enforcement of economic substance and Country-by-Country (CbC) reporting frameworks. In the UAE, these regimes are increasingly being used as risk-assessment tools, providing tax authorities with a comprehensive view of multinational groups’ global footprints and enabling them to assess whether profits are aligned with real economic activity.
Contributed by Thomas Vanhee and Hend Rashwan, Aurifer
Ferrari 12Cilindri specs
Engine: naturally aspirated 6.5-liter V12
Power: 819hp
Torque: 678Nm at 7,250rpm
Price: From Dh1,700,000
Available: Now
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GIANT REVIEW
Starring: Amir El-Masry, Pierce Brosnan
Director: Athale
Rating: 4/5
Teams
Punjabi Legends Owners: Inzamam-ul-Haq and Intizar-ul-Haq; Key player: Misbah-ul-Haq
Pakhtoons Owners: Habib Khan and Tajuddin Khan; Key player: Shahid Afridi
Maratha Arabians Owners: Sohail Khan, Ali Tumbi, Parvez Khan; Key player: Virender Sehwag
Bangla Tigers Owners: Shirajuddin Alam, Yasin Choudhary, Neelesh Bhatnager, Anis and Rizwan Sajan; Key player: TBC
Colombo Lions Owners: Sri Lanka Cricket; Key player: TBC
Kerala Kings Owners: Hussain Adam Ali and Shafi Ul Mulk; Key player: Eoin Morgan
Venue Sharjah Cricket Stadium
Format 10 overs per side, matches last for 90 minutes
Timeline October 25: Around 120 players to be entered into a draft, to be held in Dubai; December 21: Matches start; December 24: Finals
More from Neighbourhood Watch
If you go
The flights
Emirates and Etihad fly direct to Nairobi, with fares starting from Dh1,695. The resort can be reached from Nairobi via a 35-minute flight from Wilson Airport or Jomo Kenyatta International Airport, or by road, which takes at least three hours.
The rooms
Rooms at Fairmont Mount Kenya range from Dh1,870 per night for a deluxe room to Dh11,000 per night for the William Holden Cottage.
RACE CARD
6.30pm Mazrat Al Ruwayah – Group 2 (PA) $36,000 (Dirt) 1,600m
7.05pm Handicap (TB) $68,000 (Turf) 2,410m
7.40pm Meydan Trophy – Conditions (TB) $50,000 (T) 1,900m
8.15pm Al Maktoum Challenge Round 2 - Group 2 (TB) $293,000 (D) 1,900m
8.50pm Al Rashidiya – Group 2 (TB) $163,000 (T) 1,800m
9.25pm Handicap (TB) $65,000 (T) 1,000m
Who has been sanctioned?
Daniella Weiss and Nachala
Described as 'the grandmother of the settler movement', she has encouraged the expansion of settlements for decades. The 79 year old leads radical settler movement Nachala, whose aim is for Israel to annex Gaza and the occupied West Bank, where it helps settlers built outposts.
Harel Libi & Libi Construction and Infrastructure
Libi has been involved in threatening and perpetuating acts of aggression and violence against Palestinians. His firm has provided logistical and financial support for the establishment of illegal outposts.
Zohar Sabah
Runs a settler outpost named Zohar’s Farm and has previously faced charges of violence against Palestinians. He was indicted by Israel’s State Attorney’s Office in September for allegedly participating in a violent attack against Palestinians and activists in the West Bank village of Muarrajat.
Coco’s Farm and Neria’s Farm
These are illegal outposts in the West Bank, which are at the vanguard of the settler movement. According to the UK, they are associated with people who have been involved in enabling, inciting, promoting or providing support for activities that amount to “serious abuse”.
Our legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
Who's who in Yemen conflict
Houthis: Iran-backed rebels who occupy Sanaa and run unrecognised government
Yemeni government: Exiled government in Aden led by eight-member Presidential Leadership Council
Southern Transitional Council: Faction in Yemeni government that seeks autonomy for the south
Habrish 'rebels': Tribal-backed forces feuding with STC over control of oil in government territory
Key figures in the life of the fort
Sheikh Dhiyab bin Isa (ruled 1761-1793) Built Qasr Al Hosn as a watchtower to guard over the only freshwater well on Abu Dhabi island.
Sheikh Shakhbut bin Dhiyab (ruled 1793-1816) Expanded the tower into a small fort and transferred his ruling place of residence from Liwa Oasis to the fort on the island.
Sheikh Tahnoon bin Shakhbut (ruled 1818-1833) Expanded Qasr Al Hosn further as Abu Dhabi grew from a small village of palm huts to a town of more than 5,000 inhabitants.
Sheikh Khalifa bin Shakhbut (ruled 1833-1845) Repaired and fortified the fort.
Sheikh Saeed bin Tahnoon (ruled 1845-1855) Turned Qasr Al Hosn into a strong two-storied structure.
Sheikh Zayed bin Khalifa (ruled 1855-1909) Expanded Qasr Al Hosn further to reflect the emirate's increasing prominence.
Sheikh Shakhbut bin Sultan (ruled 1928-1966) Renovated and enlarged Qasr Al Hosn, adding a decorative arch and two new villas.
Sheikh Zayed bin Sultan (ruled 1966-2004) Moved the royal residence to Al Manhal palace and kept his diwan at Qasr Al Hosn.
Sources: Jayanti Maitra, www.adach.ae
Tips for taking the metro
- set out well ahead of time
- make sure you have at least Dh15 on you Nol card, as there could be big queues for top-up machines
- enter the right cabin. The train may be too busy to move between carriages once you're on
- don't carry too much luggage and tuck it under a seat to make room for fellow passengers
Dhadak
Director: Shashank Khaitan
Starring: Janhvi Kapoor, Ishaan Khattar, Ashutosh Rana
Stars: 3
Winners
Ballon d’Or (Men’s)
Ousmane Dembélé (Paris Saint-Germain / France)
Ballon d’Or Féminin (Women’s)
Aitana Bonmatí (Barcelona / Spain)
Kopa Trophy (Best player under 21 – Men’s)
Lamine Yamal (Barcelona / Spain)
Best Young Women’s Player
Vicky López (Barcelona / Spain)
Yashin Trophy (Best Goalkeeper – Men’s)
Gianluigi Donnarumma (Paris Saint-Germain and Manchester City / Italy)
Best Women’s Goalkeeper
Hannah Hampton (England / Aston Villa and Chelsea)
Men’s Coach of the Year
Luis Enrique (Paris Saint-Germain)
Women’s Coach of the Year
Sarina Wiegman (England)
Our legal consultant
Name: Hassan Mohsen Elhais
Position: legal consultant with Al Rowaad Advocates and Legal Consultants.
