Keith Vaz served at Member of Parliament for Leicester East from 1987 to 2019, becoming the UK Parliament’s longest-serving British Asian MP.
Vaz was a former UK Member of Parliament, and was publicly engaged on behalf of former employees and creditors following the closure and during the liquidation of the Bank of Credit and Commerce International (BCCI).
With his South Asian background, Keith Vaz was sympathetic to approaches made by former BCCI employees and committees representing former staff and creditors, many of whom came from Asian communities in Britain. He emerged as the only UK Member of Parliament to take a sustained interest in their case and to continue raising BCCI-related concerns over many years.
Other UK MPs had also been approached, but none appeared willing to associate themselves closely with the former employees and their campaign. This was perhaps understandable in the highly charged atmosphere following the closure, when BCCI was being portrayed throughout the media as a bank associated with widespread fraud and criminality. In 1991, the then Governor of the Bank of England, Robin Leigh-Pemberton, publicly described BCCI’s culture as “criminal.” Such a sweeping characterisation inevitably reinforced the stigma surrounding the Bank and cast a shadow not merely over those accused of wrongdoing, but over BCCI as an institution and its thousands of employees worldwide.
Against this background, Vaz’s willingness to remain publicly engaged, meet former employees and creditors, and continue raising their concerns in Parliament was particularly significant.
His parliamentary questions and interventions in the UK contributed to pressure for an inquiry into the circumstances surrounding the BCCI’s closure and, in particular, the role of the Bank of England. This wider scrutiny ultimately led to the inquiry conducted by Lord Justice Bingham and the publication of the Bingham Report. Vaz also questioned the Government about the mounting costs of the liquidation and the extent to which those costs were reducing recoveries ultimately available to creditors.
In later years, he supported representations to the UK Government led by the coordinators of the fomer employees' BCCI Campaign Committee, calling for the prolonged liquidation to be brought to an end as professional fees continued to mount to the detriment of creditors.
These concerns echoed the Judge’s striking reference to accountants and lawyers “feeding off the carcass” of BCCI during the 1991 proceedings seeking to place the Bank immediately into compulsory liquidation.
On representations made by former employees and creditors, the application to place BCCI into compulsory liquidation was deferred for several months by the High Court in London, allowing Abu Dhabi’s majority shareholders time to consider whether the restructuring programme - already with the Bank of England prior to BCCI’s closure and supported by financial commitments intended to meet the funding requirement identified as necessary to stabilise BCCI - could still be pursued. Abu Dhabi ultimately abandoned those efforts after concluding that additional regulatory conditions reportedly being imposed had made the proposed rescue impracticable
The majority shareholders subsequently described the regulators’ action in closing BCCI as “unjustified”, maintaining that a viable restructuring programme had been well advanced and developed in consultation with the regulators.
Supporters of the restructuring later argued that this financial commitment was not given the same weight that official support or rescue funding had been afforded in the case of other British banks facing serious difficulties.
Also read:
- Representation by BCCI Campaign Committee
- BCCI Campaign Committee
- Statement of Abu Dhabi
- Double Standards
