27/06/2012 Newsnight


27/06/2012

Jim Reed considers proposals to protect children from online pornography, as smart phones and other devices proliferate. And the politics of Lords reform. With Emily Maitlis.


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Transcript


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Tonight, bankers back in the dock as Barclays is found guilty of

:00:11.:00:16.

lying to customers and investors, by tempting to rig interest rates.

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The bank is fined, the boss forgos his bonus, but is that enough, and

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was everyone else at it. The regulator tells us the wrongdoing

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went further than one rogue bank. We have to look at each case on its

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own particular facts, but the initial indications is that

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Barclays was not the only firm involved in this. As we understand,

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RBS was in the frame, we ask our panel what needs to be done to

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control our banking system. How hard do you have to look before you

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find this on your computer, more importantly, how hard do your kids

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have to work. I typed in two words on my laptop, I was absolutely

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gobsmacked by what came up. I had no idea at that point, just how

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explicit the pornography was. campaigners warn of the Government

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going soft on porn, we talk to the virtual reality pioneer, Jaron

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Lanier, and ask our panel if it's time to make us opt in to what we

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view. Also tonight:

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Welsh baritone Bryn Terfel talks to us on the eve of his major Welsh

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music festival. I can't act. I put myself in whatever the director

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tells me, I try my best to achieve his insights and thoughts.

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Good evening, how do we put some of the banker blame game behind us?

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Bob Diamond the head of Barclays asked the select committee last

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year. Tonight he may be eating his words, after his bank was found

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guilty of lying over the course of four years about the interest rate

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it was having to pay to borrow money. Perhaps, most shockingly of

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all, the lying was done as decently as 2009, as a result of

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instructions from Barclays senior management. Today Mr Diamond

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apologised and has given up his bonus. Tonight Newsnight has

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learned of other banks under the spotlight doing the same thing.

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Inside Barclays there is the gambling side called investment

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banking, and more mundane advisory and retail sides. Between them is

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supposedly a sacrosanct Chinese wall, but this rate-setting scandal

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appears to have destroyed the very edifice of that wall. The

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reprecussions could be huge. The InterBank lending rates, which

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Barclays has conceded it tried to manipulate, are also used to set

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mortgage rates for millions of people around the world. The banks'

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traders reached across the corridors to their colleagues, who

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set these rates, and illegally persuaded them to push them up or

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down in the bank's favour. That has earned the dubious result of

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getting fines on both sides of the Atlantic. The CTFC, the American

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watchdog, said Barclays top boss, not only lowly traders were

:03:11.:03:21.
:03:21.:03:29.

Some of the e-mails between traders underpinned the level of collusion

:03:29.:03:39.
:03:39.:03:46.

At the heart of this scandal is LIBOR, or the London Interbank

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Offered Rate, this interest rate is agreed by a select number of key

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banks every day, and despite its very local name, it is a global

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Bevan mark for contracts worth hundreds of trillions of pounds. So

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even the smallest deviations can save or cost a bank billions.

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The fact that the banks have been manipulating LIBOR, the rate of

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interest on those loans, is outrageously shocking. The Barclays

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boss, Bob Diamond, said today he would give up his bonus this year,

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he has been trying to draw a line under banker bashing for two years,

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and even drew an ethical line under the business last year. We have to

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build a better way of banks generating growth. Second, we have

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to accept responsibility for what had gone wrong. Finally, and most

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importantly, we have to use the lessons learned to become better

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and more effective citizens. Bob Diamond's predecessor, John

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Varley, boss at the time of the collusion, is 12-1 to be the next

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Governor of the Bank of England. Diamond had a shred of shame he

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would resign, he hasn't, if the Barclays board has an inch of

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backbone they will sack him. Utterly unacceptable that he could

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carry on after this, and after Barclays' aggressive tax avoidance

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when they had to pay �500 million back to the Treasury in February,

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enough is enough. Barclays would have paid a much bigger fine but

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for the fact of the banks being investigated, they were the first

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to put up their hands and claim leancy. This suggests this is just

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the tip of the iceberg, and there are plenty of banks, including some

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very big British banks, that are waiting anxiously for the wrath of

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the regulator, or the approbium of the public. We know that other

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leading banks are involved in these investigations. So we know that the

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Royal Bank of Scotland, UBS, Citigroup, Lloyds Banking Group,

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Deutsche Bank, the broker ICAP, are all currently in the spotlight. We

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could see more events like we have had today. Newsnight understands a

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handful of RBS traders have already been dismissed for their part in

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fixing InterBank rates. The state- controlled bank is co-operating

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fully with regulators both here and in the states. There is no doubt,

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though, that this latest scandal, surrounding the banking fraternity,

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will further damage an industry, whose public reputation already

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ranks below car clampers and tax inspectors. After PPI, outlandish

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bonus, and the mortgage-backed assets, that caused the financial

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crisis, this latest may beat them all. Colluding to set the rate of

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interest that decides how much ordinary people pay for their homes,

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may prove for banking what phone hacking did for tabloid journalism.

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We asked Barclays for an interview tonight, they declined our

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invitation. A little earlier I asked my guest from the Financial

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Services Authority, how shocked she was at what they had discovered?

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found the misconduct of Barclays is some of the most serious we have

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ever seen, that is why the penalty we have imposed is such a

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significant one. We were looking at this at the end of 2009, beginning

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of 2010. The more we dug into it and the more we looked into it the

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more we found in relation to misconduct by the traders and

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across the relevant desks. We took this very seriously indeed.

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damaging do you think this could have been, then? The issue that is

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of concern to us here, is LIBOR is obviously the benchmark rate used

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for contracts across the world, worth hundreds of millions of

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pounds. It is really important for the integrity of that rate to be

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preserved, that the market is confident that the rate that is

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fixed actually reflects what it is supposed to, which is the amount at

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which banks can borrow from each other. The risk that was supposed

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by the misconduct we have seen at Barclays is that the rates risk not

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being based on those borrowing figure, but were being based on

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other issues, for instance, the positions of derivative traders in

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relation to their book, or concerns about Barclays reputation. We took

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this very seriously indeed. Realistically, you haven't got to

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the end of things here, how widespread do you think the

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practice is? We have a number of on going investigations in relation to

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LIBOR. Whilst those investigations are on going I can't comment on

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them, when they are concluded we will clearly publicise the outcome.

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When you say a number, are we talking more than a dozen, more

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than five, how many are we looking at? I'm afraid I can't give awe

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number. All I can say is we have a number of investigation that is are

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on going. But you are pretty sure you are going to find a situation

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similar to the one in Barclays in at least one of them? I think that

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obviously we need to look at each case on its own particular facts,

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but the initial indication was that Barclays was not the only firm

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involved in this. You have imposed a fine which you say is the largest

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of its kind, nearly �300 million, that is the kind of sum Barclays

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could make in half an hour? penalty, the number you talked

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about is not just our penalty, that is also the penalties imposed by

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the US authorities as well. They have imposed penalties on Barclays

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today. The penalty we have imposed we think is a very significant

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penalty, it is set in accordance with our own penalties' framework,

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I think the impact on Barclays goes far beyond the simple penalty, the

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amount of publicity and comments that will have happened today and

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over the coming days in itself will be significant for Barclays'

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reputation. Thank you. Here to take the story on, from

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Washington we have a lawyer for the securities and exchange commission

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in Washington, he now runs a company advising bankers about

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regulations. In the studio we have the former City Minister, and a

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former banker, thank you very much to all of you.

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In Washington, I will start with you. You heard from the FSA there,

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in your opinion, does the punishment fit the crime, would

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this stop any bank doing it again? First, I have to say I'm a former

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ACC lawyer, not current. I think what the FSA did was not hard

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enough. I think the facts support conflicts of interest, a systemic

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breakdown in supervision and management. There is an attempt to

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blame compliance when compliance was not responsible for it. I think

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what the FSA did was levied a slap on the wrist, when compared to the

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US Justice Department, and also the CFTC. If you read the CFTC's order

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that came out today, there were 18 pages of significant controls,

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requirements, that Barclays has to adhere to. There is training,

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supervision. I think this is what I would call not a victimless crime.

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I think what the FSA could have done, and had the opportunity to,

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was do more than levy a fine, I think they could have imposed

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severe restrictions on the ability of Barclays to operate in this

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market. How would they do that? They could impose the same types of

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controls that the CFTC did. Would have to make the entire process by

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which they were to calculate data and submit them, provide it to the

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regulator. They would have to undergo training, they would have

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to keep records and beef up their internal controls. Most importantly

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here, the disappointment that I see, is in a regulatory regime that is

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designed around tough supervision, there really wasn't tough

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supervision penalties imposed on this. The supervisers weren't named,

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when, if you compare with the CFTC did, there were very clear

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instances pointing out specific instances of supervisory failure.

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What a regulator has to do is be clear, yes the FSA did the right

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thing, but it didn't go far enough in imposing specific controls and

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provisions in Barclays to continue to stay in this area.

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I will stop you there. You have heard there the blame being levied

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at the supervision, or the lack of regulation. As a former banker, can

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you say people should be putting their hands up and saying we did

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something wrong, you can't just keep pushing the blame on

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regulation? I think there are a few points here. Very clearly, there

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was deliberate attempts to manipulate these numbers from the

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derivative areas to the bit returned to the Reuters that set

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this rate each day. That process was lax in the way it was being

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supervised. I think one can't but agree that is the critical flaw

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here. You are talking about lax as if these are children that were

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running amock in a playground. Surely the people in charge knew

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they were doing wrong? I would imagine that it would be difficult

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not to know that it was quite wrong, what was being influenced. One of

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the criteria of LIBOR is the rate is set by the people who are

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responsible for the cash position of the bank, and not by the trading

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areas of that bank. There shouldn't be any contact between the two.

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That is the fundamental guideline. This LIBOR position has to relate

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to the unsecured borrowing between banks, and the rate at which they

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could borrow that money. When you look at the kind of e-mail that is

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were sent, the very pally ones, let's open a bottle of champagne,

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it was a boys' club? There was that kind of culture, there shouldn't

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have been that kind of communication between those two

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sides at all, that is the critical thing. You can see from this, the

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reasons why people are very keen to achieve closer separation between

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the retail banking side, the Treasury side of the, if you like,

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the more mundane part of the bank, by comparison with the investment

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banking piece. Because at the back of this you probably have a

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boneless structure that is driving behaviours you don't want to have

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happening. You can talk about a bonus structure or a Chinese wall,

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but there will be people silting at home saying I don't understand --

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sitting at home saying I don't understand why there aren't

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criminal prosecutions over this. Lying on something that is meant to

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be a standard bearer for the industry? They have let Barclays

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off lightly, the �300 million is less than Bob Diamond has earned in

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the last four years. It is a few days trading profit, it could be

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the profit that arose from one single lie. The American

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authorities were much stronger in their language than the UK. They

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used the word "lying", they detailed multiple failures. This is

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the most corrosive failure of moral behaviour that I have seen in a

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major UK financial institution n my career. You would like to see

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criminal prosecutions, presumably? I think fines and public criticism

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will not stop these behaviours. These behaviour also not stop until

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the people perpetrating it, or are responseable for oversaeing --

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Responsible for overseeing them face the prospect of going to jail

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and criminal charges. What should have happened to Diamond? Barclays

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people said they were not taking their bonuses, most people would

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say why are they getting bonus, the bank isn't making an adequate

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profit, and Mr Dime has had to tear up his business plan. This bank has

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been fined by the FSA four times in the last two-and-a-half years. Why

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they were paying bonuses I think, in itself, is highly questionable.

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What should Barclays Bank do now? They need to look at the people at

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the top. The chairman at the bank was there when it all happened, the

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chief executive was there when it happened. What do you mean look at

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it, do you mean fire them? They have to ask seriously whether the

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people at the very top of the bank were setting the right cultural toy.

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In Bob Diamond's BBC Today Programme lecture, he said the

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culture of an organisation was what happened when you thought people

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weren't looking. We now know what was happening in Barclays when they

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thought people weren't looking. They were, in the words of the

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Department of Justice in America, lying. And we cannot have people

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like that holding responsible and senior positions in a banks where

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the taxpayer ultimately stands behind it. Why isn't there a single

:16:46.:16:50.

political leader or party tonight, then, that is calling for him to go

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f that's right? I don't think we know enough, Emily, about the

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detail. But the idea that the time has come for deputy heads to hole

:16:59.:17:03.

is a nonsense, the people at the very top must take responsibility

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for a complete cultural failure. This is a company that is had to

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pay back �100 million for mis- selling of protection insurance,

:17:17.:17:20.

and multiple fines in multiple jurisdictions. This behaviour

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didn't just happen here, it happened in America and Asia. It

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involved a wide number of executive, according to the regulators. There

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is something deeply wrong at the heart of Barclays, and the response

:17:30.:17:35.

to date has simply been inadequate. Do you think that's right. In the

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report, we heard many other banks and institutions named. This is

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presumably going on in the US too, you probably know the ones under

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investigation there. I agree, being a former regulator in the United

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States and Britain. Having been a compliance officer and seeing firms

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from the inside. The heart and soul from any organisation is tone at

:18:00.:18:04.

the top and proper supervision. The evidence here is neither were

:18:04.:18:13.

present. The thing that shocks me the most is the attempt to blame

:18:13.:18:16.

compliance for something is completely wrong. That is situation

:18:16.:18:20.

where senior management have an affirmative responsibility to

:18:20.:18:25.

document that they are supervising. In Asia, here in the states, in

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England, anywhere in the world, conduct like this is flat out

:18:30.:18:35.

unacceptable. When you say, conduct, there is no proof that anyone

:18:35.:18:39.

actually physically lost money over this? Right? The issue is not the

:18:39.:18:47.

loss of money. The issue is a failure to supervise, consistently

:18:47.:18:53.

in enforcement actions around the world, regulators always point to a

:18:53.:18:57.

failure to supervise as a contributing factor to an initial

:18:57.:19:01.

breach. If these individuals were properly sup advising, they would

:19:01.:19:07.

have not only idea -- supervising, they would have not only looked at

:19:07.:19:12.

the conflicts of interests, but addressed it. There is a failure to

:19:12.:19:17.

deal with conflicts of interest and supervise, if there was, the firm

:19:17.:19:21.

would have been caught out and rooted out months ago.

:19:21.:19:25.

wondering if you were working at Barclays tonight, would you be

:19:25.:19:29.

thinking your reputation was in tatters, or would you be saying, we

:19:29.:19:33.

got off that one quite likely and look at the other ones under

:19:33.:19:37.

investigation, we will just melt into the middle? There are big

:19:37.:19:42.

worries certainly about the supervision point. I superintendant

:19:42.:19:46.

a lot of people don't understand what this relates to. But these

:19:46.:19:52.

interest rates governs about �10 trillion worth of borrowing on the

:19:52.:19:56.

syndicated markets, and �250 trillion of trading in swaps,

:19:56.:20:03.

interest rate cover and other things. It is a very important

:20:03.:20:06.

mechanism. It is crucial the pricing is right, otherwise the

:20:06.:20:10.

counter parties to the organisation, you and I, and everybody else, are

:20:10.:20:12.

basically paying the wrong interest rates. That is what the fundamental

:20:12.:20:17.

risk is that is going on here. What is crucial. Let me just ask you

:20:17.:20:22.

that again, faced with what we have got, essentially a fine, which as

:20:22.:20:26.

Lord Myners said, Bob Diamond could make in four years, they won't be

:20:26.:20:30.

feeling this is something that is so outlawed, so immoral, so

:20:30.:20:34.

criminal, that nobody will be doing it ever again? They will be feeling

:20:34.:20:38.

the reputational damage imposed by this control. Even if they are one

:20:38.:20:43.

of 10 or 12? Even so. There will be big problems associated with this.

:20:43.:20:49.

What is critical to us. And by "us" I mean, us, as a country, is that

:20:49.:20:53.

we put the supervision in place to make sure this type of problem

:20:53.:20:58.

doesn't arise, and bear in mind this was raised back in 200, by the

:20:58.:21:02.

Wall Street Journal. Raised in 200, when you were City's minister, you

:21:02.:21:07.

must have known about this? There were problems of setting The

:21:07.:21:12.

Libertines interest rate structures, this is not a new occurrance -- the

:21:12.:21:15.

LIBOR interest rate structure, this is not a new occurrance. This was

:21:15.:21:18.

not known about at the time, if it had, action would be taken. People

:21:18.:21:22.

have lost money because of this, the Department of Justice in

:21:22.:21:26.

America is very clear in its wording, that losses have arisen as

:21:26.:21:33.

a result of this. We are going to see a lot of litigation.

:21:33.:21:36.

As anyone who has ever looked for porn on the Internet, many of you

:21:36.:21:41.

haven't, but found it any way. It doesn't take a degree in computer

:21:41.:21:45.

science, gone are the days of credit card payments and tricky

:21:45.:21:51.

encryptions, now it is as easy to get as YouTube. Should be providing

:21:51.:21:58.

be made block all pornographic images, an issue looked at tomorrow.

:21:58.:22:02.

Newsnight understands that coalition ministers are currently

:22:02.:22:06.

reluctant to opt-in measures, they want to go for a watered down

:22:06.:22:12.

version of on-line child protection. A good old fashioned scare story,

:22:12.:22:15.

or a genuine threat to Britain's teenagers. Newspapers have been

:22:15.:22:19.

full of headlines, warning about the dangers of unfiltered,

:22:19.:22:24.

unstoppable porn on the Internet. Now the argument's changing. It is

:22:24.:22:27.

not whether porn is damaging young people, it is how the Government

:22:27.:22:36.

should stop children from watching Hi, welcome to our lesson on

:22:36.:22:40.

pornography. At this comprehensive in Sheffield a group of 16-year-

:22:40.:22:43.

olds are being taught the difference between real life and

:22:43.:22:47.

what they see on a computer screen. A girl wouldn't feel comfortable

:22:48.:22:51.

doing something on porn, but boyfriends would expect them to do

:22:51.:22:57.

it. Born in 1996, this is the first generation to be brought up on-line.

:22:57.:23:01.

Do you think that pornography is really easy to get hold of on-line.

:23:01.:23:05.

They don't have to directly type in porn, even when they do it comes up

:23:05.:23:09.

with pages and pages full. They would easily be able to access it.

:23:09.:23:16.

Do you think it should be harder to get hold of? For certain ages, yeah.

:23:16.:23:21.

This sex education class is unusual, though. In other parts of the UK,

:23:21.:23:24.

schools and colleges have been reluctant to tackle issues like

:23:24.:23:30.

porn. The governors don't like it, and often parents don't either.

:23:30.:23:33.

want to know what our young people are looking at, particularly

:23:33.:23:37.

because I have children of my own. When I typed in two words, into the

:23:37.:23:42.

Internet, I was absolutely horrified with how easy it was to

:23:42.:23:47.

get hold of really extreme pornography. I think if our young

:23:47.:23:51.

people have access to stuff like that, we owe it to them to make

:23:51.:23:54.

sure our sex education is really up-to-date, takes account of the

:23:54.:23:58.

fact that they can access this kind of stuff. We need to look at the

:23:58.:24:02.

messages coming from pornography, and counter act some of those

:24:02.:24:05.

messages. At the centre of all this is a shift in the way porn is

:24:05.:24:10.

viewed, the way porn is accessed on the Internet. Just a few years ago

:24:10.:24:14.

many adult sites needed a credit card, now those pay sites have been

:24:14.:24:19.

replaced by what looks like very adult, very X-rated versions of

:24:19.:24:25.

YouTube. The new free sites offer unlimited

:24:25.:24:29.

access to thousands of hardcore video, with no age restriction at

:24:29.:24:33.

all. The material is often so extreme, so accessible, many now

:24:33.:24:37.

think it is time for the Government to step in.

:24:37.:24:42.

There are three main option ones the table, first up, do nothing,

:24:42.:24:46.

many civil liberties groups think policing the Internet should be

:24:46.:24:53.

left entirely up to parents. Next, active choice, sign up for a new

:24:53.:24:56.

broadband contract and you will be forced to choose whether to install

:24:56.:25:01.

a child prodetection filter, all the main broadband providers have

:25:01.:25:06.

agreed do this, it is the Lib Dems preferred option, and Newsnight

:25:06.:25:09.

understands Conservative ministers are keen as well. Many want to go

:25:09.:25:13.

further, an automatic block, a porn filter is turned on by default,

:25:14.:25:17.

that can only be lifted if you contact your internet provider or

:25:17.:25:21.

switch it off. That is supported by Labour, and some backbench story

:25:21.:25:26.

MPs. What we want is a one-click solution, that basically means that

:25:26.:25:29.

adult content is blocked, if you want it, you have to go through the

:25:29.:25:33.

filter to get T we think that would be safer, we think it is a system,

:25:33.:25:37.

we know it is a system that works with the mobile operators, we know

:25:37.:25:41.

it is a system people say they want. Delighted that the Government's

:25:41.:25:46.

consultation is going to look specifically at that.

:25:46.:25:50.

But, there are questions as to whether any block can ever really

:25:50.:26:00.
:26:00.:26:00.

be effective. With four million customers Talk

:26:00.:26:05.

talk is one of the biggest broadband providers, it has spent

:26:05.:26:09.

millions developing its own system for stopping adult content. We have

:26:09.:26:13.

settings so we can wish not to allow this particular set of

:26:13.:26:18.

children to view pornographic sites, gambling sites. This is a doctor of

:26:18.:26:23.

computing at Cambridge, he says systems like this can be easily

:26:23.:26:26.

evaded. That is how it should work, how

:26:26.:26:30.

easy is it to get round the restrictions? There are several

:26:30.:26:34.

ways of accessing unsuitable sites. We could just use a proxy f we want

:26:34.:26:39.

to go off and look at a porn website, we could type this name in

:26:39.:26:42.

here, and behold we start getting pictures here which your viewers

:26:42.:26:52.

don't want to see. That isn't being blocked at all by

:26:52.:26:58.

Talk Talk. It offers a certain level of protection, but people

:26:58.:27:02.

would be wrong to assume protection is anything like perfect. The

:27:03.:27:07.

system will block some of it, by no means all, if you view it as being

:27:07.:27:12.

a substitute for parenting skills you will be sadly mistake. Switch

:27:12.:27:17.

on Talk Talk safety settings you get an e-mail saying you can relax

:27:17.:27:20.

and let your children surf the Internet. Is that a promise too far.

:27:20.:27:25.

We try to be clear with our customer that is Home Safe is a

:27:25.:27:30.

tool that will make the Internet safer, it won't make it safe, full

:27:30.:27:34.

stop, in no way would we advise customers as a means to stepping

:27:34.:27:39.

away in thinking how their children are using the Internet. Why do you

:27:39.:27:43.

e-mail customers when they change their internet settings, that they

:27:43.:27:47.

can relax and allow their children surf the Internet, isn't that the

:27:47.:27:50.

wrong impression? That is not what we want to do, clearly that is not

:27:51.:27:54.

right. Which want to give customers comfort that they have done a God

:27:54.:27:57.

thing and build their confidence. The Government doesn't really want

:27:57.:28:00.

to go down the road of extra legislation and red tape, but the

:28:00.:28:04.

pressure is on with newspapers and children's charities now getting

:28:04.:28:10.

together to demand stronger action. Unless the industry is seen to be

:28:10.:28:13.

doing more, those voices are only likely to get louder.

:28:14.:28:21.

We are going to carry on the debate here in the studio. Jaron Lanier,

:28:21.:28:28.

the Godfather of internet reality, India Knight, the editor of Loaded

:28:28.:28:34.

and Claire Perry, the Tory MP who you saw in that report.

:28:34.:28:38.

You saw, Claire Perry, a second ago, who is willing to go the whole way,

:28:38.:28:42.

and say if you don't like porn, make people opt in for it. That is

:28:42.:28:47.

the bravest option, isn't it, India Knight? I don't agree, I do like

:28:47.:28:53.

porn and I consume porn, I don't think, I know, statistics show us,

:28:53.:28:58.

that an enormous number of men and women consume porn. That was the

:28:58.:29:07.

phenomenal success of 50 Shades of Grey, triology, busting any Harry

:29:07.:29:11.

Potter records. Porn you see on the Internet is legal, it is not

:29:11.:29:16.

illegal, there is a dishonesty that occurs when lobbies seeking to

:29:16.:29:20.

ghettoise porn link it to child pornography. Nobody sane or

:29:20.:29:24.

rational is interested in looking at child pornography, that is out

:29:24.:29:30.

there all on its own, to conflate child pornography and porn. I don't

:29:30.:29:34.

think we have done that. You are comfortable watching porn, and

:29:34.:29:37.

being known on national television being a viewer of porn, you

:29:37.:29:41.

wouldn't mind opting into a scheme that asked you to choose? I know

:29:41.:29:45.

when my children were small, like any parent, I tortured myself with

:29:45.:29:49.

the idea of the images they might be seeing, and the appalling things

:29:49.:29:54.

I might inadvertantly expose them to. The solution is to have the

:29:54.:29:59.

computer in a public space, like a kitchen or sitting room, and not

:29:59.:30:05.

send nine-year-old kisd up to the stairs -- up the stairs with a lap

:30:05.:30:13.

stop. I put filters on them that my teenage boys dismantled in the --

:30:13.:30:17.

in minutes. I don't want little kids watching t but it is my

:30:17.:30:20.

parental responsibility. I have got children slightly younger, you are

:30:20.:30:23.

right, in an ideal world, this is absolutely part of parental

:30:23.:30:26.

responsibility, keeping kids safe, whether in cars or on the Internet,

:30:26.:30:31.

we know, if you look at the facts, four out of ten families are

:30:31.:30:35.

downloading these device-level filters, six out of ten British

:30:35.:30:39.

children are going on-line, often with their laptop, offer half of

:30:39.:30:41.

kids access the Internet in a private space, something we don't

:30:41.:30:44.

think is right. We have to stop dealing with the perfect and the

:30:45.:30:48.

theoretical and deal with the facts. We know children are accessing this

:30:48.:30:51.

material. It is not porn as we know it, that came across, that teacher

:30:51.:30:55.

is a very brave lady to be tackling that thing. What are you saying,

:30:55.:30:59.

you are saying six out of ten British children probably watch

:30:59.:31:04.

porn on-line? Are able to access pornography on-line. Hypothetically.

:31:04.:31:07.

Also the proportion of teenagers, the filtering drops as your

:31:07.:31:10.

children get to puberty. And arguably that is when you actually

:31:10.:31:16.

want to start being very well aware. I agree being a vigilent parent is

:31:16.:31:20.

absolutely the ideal, the facts are people aren't doing T the current

:31:20.:31:26.

system we believe is defunct and it is time for different. Who is the

:31:26.:31:29.

hypothetical six-year-old constantly exposed to porn.

:31:29.:31:33.

evidence suggests that 82% of British people are really worried

:31:33.:31:38.

about how easys to access porn. It is unique that people feel helpless

:31:38.:31:44.

about it, half of people say their kids know more than them about

:31:44.:31:49.

technology. And others think the school is teaching them how to

:31:49.:31:53.

safely use the Internet, we are teaching them not to put out their

:31:53.:31:58.

number on Facebook. There is a sense of helpless. You edited

:31:58.:32:02.

Loaded for six years, do you think this problem should fall to the

:32:02.:32:07.

broadband companies, the vehicle Which? You access? I think so.

:32:07.:32:11.

Getting everybody to opt in is a step too far. The thing we should

:32:11.:32:15.

stress is adults consume pornography in a healthy way and

:32:15.:32:19.

shouldn't be criminalised. In relation to opting in, and you are

:32:19.:32:23.

married, and your wife doesn't approve, what will that say about

:32:23.:32:28.

that relationship correction it lead to marital break-ups. It does,

:32:28.:32:33.

a lot of people are reporting it is a problem. If you drive anything

:32:33.:32:37.

underground you make it more desirable and aspirational. More

:32:37.:32:40.

people want it if you ban it, same as anything, that is the world.

:32:40.:32:45.

What are you saying f you made people opt in, you think it could

:32:45.:32:48.

have a detrimental effect on marriage in this country? I think

:32:48.:32:51.

it possibly could lead to relationship problems because

:32:51.:32:58.

people are made to feel grubby and secretive. Lots of people consume

:32:58.:33:04.

pornography, why isn't it an issue. The consultation being led by

:33:04.:33:07.

Number Ten tomorrow, this is something with a broad consensus.

:33:07.:33:13.

To get back, we treat the Internet really differently, that is where

:33:13.:33:18.

Gerald's view is so great, you have to opt in to get adult content on a

:33:18.:33:25.

mobile phone. A parent getting a mobile phone contract for a child

:33:25.:33:32.

has to opt in for adult content t works there why not the Internet.

:33:32.:33:37.

Is it better to leave the Internet as the untamed wild west? First,

:33:37.:33:41.

the Internet is not like the printing press or the TV, it has

:33:41.:33:45.

really become more intimate and universal, it is the conversation

:33:45.:33:49.

people have with each other. Getting into the middle of it has

:33:49.:33:53.

more profound implications than getting into the middle of earlier

:33:53.:33:57.

media technologies. My concern is if the Government takes this step,

:33:57.:34:02.

you will enter into a cat and mouse game with all sorts of sneaky

:34:02.:34:04.

technical players from around the world and you will have to escalate,

:34:04.:34:08.

and end up in a different place than you intend. What makes more

:34:09.:34:13.

sense is to look at the motivations of those who would pipe this free

:34:13.:34:17.

porn nothing fee. If you really look at why on earth -- pornography.

:34:17.:34:22.

If you look at why on earth they do it, when kids send to to each other

:34:22.:34:26.

we can't do anything about, that I would prioritise issues like

:34:26.:34:30.

bullying, however. You are saying the porn providers are doing it for

:34:30.:34:33.

money? They are, and how are they doing it for the money, the porn is

:34:33.:34:38.

free, it is not directly for the money. They are using it as bait to

:34:38.:34:42.

gather data about people and children. It is a private spy

:34:42.:34:47.

service. So if the law was focusing on that, if you said that sneakly

:34:47.:34:52.

gathering data on people and selling data has more severe

:34:52.:34:56.

penalties for everybody in the chain, you would get universal

:34:56.:34:59.

support and shut down the motivation, without getting into

:34:59.:35:02.

the middle of expression. It is this bizarre, corrupt idea that

:35:02.:35:05.

because everything is supposed to be free on the internet, the only

:35:05.:35:09.

allowed business is to run these private spy agencies and sell data

:35:09.:35:12.

about people. That is the core problem here, that is the motivator.

:35:12.:35:17.

That is not something the Government will tackle.

:35:17.:35:20.

Internet is a global, unregulate thing, that is why it is a force

:35:20.:35:25.

for good in the world. It is Ince credibly hard to regulate it. We

:35:25.:35:28.

are not suggesting that, Government doing that is bad idea, we would

:35:28.:35:33.

like the ISPs to have a self- regulation model. If you make them

:35:33.:35:36.

do that it is the same as the Government stepping in? It is

:35:36.:35:41.

putting up a consultation about the pros and cons. When we had the

:35:41.:35:44.

debate and the parliamentary inquiry, we had tonnes of ideology

:35:45.:35:48.

about it being too expensive and destroying the Internet economy,

:35:48.:35:51.

there were no facts produced to support any of that, it is

:35:51.:35:56.

assertion. We would like the facts and make the decision. If it had

:35:56.:36:02.

been as easy for Loaded to get pornography to readers as it is to

:36:02.:36:05.

the internet, you would have done brilliantly? Our business was

:36:05.:36:08.

destroyed by the Internet pornography, we were �4, and had

:36:08.:36:12.

you to go and buy t and we could be sued if we break the laws. We

:36:12.:36:19.

operated within the PCC and the retailers, we would be delisted, we

:36:19.:36:22.

couldn't compete. The Internet is a din interprice, they eroded our

:36:22.:36:27.

business and destroyed it. Did we want to do that? No, we weren't a

:36:27.:36:30.

porn magazine. Where do you sit on this debate, do you regret the kind

:36:30.:36:37.

of stuff you pushed as an editor? grew up and became a father, my

:36:37.:36:41.

perspective changed at that moment, it is a young man's game. Being a

:36:41.:36:46.

father and working in an industry where Loaded was the softer end of

:36:46.:36:51.

the scale, it is described as a nursely slope for it, I got out, it

:36:51.:36:55.

was my choice. When you say you are happy with porn being in the house?

:36:55.:37:03.

I'm not saying I'm gathering people around after Sunday lunch. If your

:37:03.:37:08.

boys came and you had the talk with your sons, do you think it aters

:37:08.:37:12.

the way that they will say sexual relationships? I used to think that

:37:12.:37:16.

it would. I used to think in my more panicked moments that they

:37:16.:37:23.

would be Ruskin, unable to have sex with his wife on her wedding night,

:37:23.:37:28.

because she didn't look like a perfect Greek statue and had pubic

:37:28.:37:32.

about hair. I used to worry prech that my male children would think

:37:32.:37:35.

women looked and behaved in a different way. That is nonsense,

:37:35.:37:40.

they exist in a world of normal women, and are able to tell the

:37:40.:37:44.

difference between fantasy and reality. I think it is worth saying,

:37:44.:37:50.

I don't think Claire realises the level of intrusion and snooping

:37:50.:37:57.

that her plan involves. I don't want when I'm Googleing, if I'm

:37:57.:38:00.

doing something innocent, if I want to buy underwear on-line, and

:38:00.:38:07.

include my bra size, or if a 15- year-old is going goinging

:38:07.:38:10.

penetration with regard to work, we are branded and blocked. We can't

:38:10.:38:15.

do it. One phrase you used about the

:38:15.:38:21.

difference between reality and the web. You coined this phrase,

:38:21.:38:24.

"virtual reality", do you think people understand the difference,

:38:24.:38:31.

people that have grown up from 1996, they have grown up using and

:38:31.:38:34.

knowing nothing but the web? What I have observed with the young people

:38:34.:38:39.

I have worked with is two divergant trend, on the one hand we are

:38:39.:38:44.

creating a new class of bullied people, an underclass, that is

:38:44.:38:47.

divergant from the issue of on-line pornography, that is on-line

:38:48.:38:51.

society and the meanness of it. If anything, I would worry about us

:38:51.:38:55.

growing a new generation of kids who are too tame, who have lived

:38:55.:39:04.

too much in the world of simulation and information, live in a social

:39:04.:39:09.

context that is categorised and reliable and constant. I would

:39:09.:39:13.

worry much more about that sense of predigested sense of society, I

:39:13.:39:16.

worry that they are too soft, they are not exploratory enough. That

:39:17.:39:24.

they take the world too much as a given. It is almost inner city.

:39:24.:39:28.

Something like that. I think there are concerns but perhaps these are

:39:28.:39:29.

not the ones that I would prioritise.

:39:29.:39:36.

Thank you very much. Bryn Terfel rose to fame after

:39:36.:39:41.

coming second in Cardiff Singer of the World in 1989, known for his

:39:41.:39:51.
:39:51.:39:52.

grand opera roles, he has cornered the Wagner market. Next week sees

:39:52.:39:59.

BrynFest, a festival of musical talent, at the Royal Festival Hall.

:39:59.:40:05.

He sprang a surprise after performance with the Simon Bolivar

:40:05.:40:13.

Orchestra. So how did this extraordinary

:40:13.:40:17.

secret surprise come about? I had meetings here at the South Bank,

:40:17.:40:23.

and they thought maybe I could an encore. How exciting for me. I just

:40:23.:40:33.
:40:33.:40:34.

told Mr Dudamel that, un ore pan ami.

:40:34.:40:40.

That's your Spanish! Just to hear them play it for the first time, it

:40:40.:40:45.

is incredible, that is enthusiasm for you. Youth in music is just

:40:45.:40:49.

tremendous. What a bridge it is. I'm singing about the wonderful

:40:49.:40:54.

bridge that goes into Valhalla. The Gods have just cleared the skies,

:40:54.:41:00.

and built a bridge for us. I wonder if they think of that, kind of, as

:41:00.:41:10.
:41:10.:41:15.

a bridge for them. You have the wild Wagner, and then you have the

:41:15.:41:21.

Covent Garden Wagner, you are doing both, how do you calibrate with

:41:22.:41:27.

different directors? I'm young in the Wagnerian torrential waters, it

:41:27.:41:33.

is maybe one-and-a-half productions of The Ring. I can't wait to sing a

:41:33.:41:41.

full Ring Cycle on my home turf. La Pag, he's production, I was very

:41:41.:41:46.

lucky to be part of the performance, controversial or not. The

:41:46.:41:50.

youngsters I came to see it that I invited loved it. When did you hear

:41:50.:41:55.

your first opera, do you know what you were? It is Othello, the

:41:55.:42:01.

Zeffirelli production, when -- Otello, the Zeffirelli production

:42:01.:42:05.

when it was out. I was given a seat by BBC Wales to review the evening.

:42:05.:42:09.

I gave it such a glowing and fantastic review, that was the

:42:09.:42:14.

ignition I needed. The candlelit, there was a eureka moment, I

:42:14.:42:20.

thought this is what I want to do. You came runner up in the Cardiff

:42:20.:42:24.

Singer of the World, that catapulted you into your future

:42:24.:42:32.

stardom? I would say it kalt puted the eventual winner, he was the

:42:32.:42:36.

clear favourite. I maybe took my time and sang smaller roles in

:42:36.:42:42.

Opera Houses in Britain. You never really had to do chorus, you were

:42:42.:42:47.

out front from the start? That is very true. Was that a handicap, at

:42:47.:42:53.

first, or did it put added pressure on you? Maybe I cut my thief more

:42:53.:42:59.

in misLenous concerts in Wales with male voice choirs and mixed choirs,

:42:59.:43:03.

without knowing it I was given an education of how to perform on the

:43:03.:43:09.

stage from a very early stage. lot of directors think opera

:43:09.:43:14.

singers can't act, how much is the performance in the opera? I can't

:43:14.:43:20.

act, I put myself in whatever the director tells me, I try my best to

:43:20.:43:27.

achieve his insights and thoughts. I will do it with gusto and with

:43:27.:43:35.

feeling. But, I need their help. I can maybe get around the single bit,

:43:35.:43:39.

but acting is a completely. We did a great evening in the Royal Opera

:43:39.:43:45.

House, of Shakespearian operas, and then some actors, acted the same

:43:45.:43:52.

sections, they came on to the set, and set that scene. We need an

:43:52.:43:55.

orchestra. I always come off the stage thinking I could have done

:43:55.:43:58.

that better, I don't think it is a bad thing. What roles haven't you

:43:58.:44:04.

done that you would love to do? never sang any of the Russian

:44:04.:44:11.

repertoire. Maybe some swan songs towards the end of my operatic

:44:11.:44:19.

career. Maybe an opera written by son time, he needs to write

:44:19.:44:28.

something after Sweeney Todd. is an eclectic mix in the BrynFest?

:44:28.:44:36.

Four eclectic nights, the Super Furry Animals there, the opera

:44:36.:44:41.

night. Three wonderful singers there, the royal national Welsh

:44:41.:44:45.

opera and cor chus will hop on stage and the pit. I can steal them

:44:45.:44:49.

from pit and stage, it doesn't happen very often. There has to be

:44:49.:44:53.

the staple diet of a male Welsh choir, with a band, myself singing

:44:53.:44:57.

a couple of songs. It is a little bit like the festival I had in

:44:57.:45:04.

North Wales on tour. # I can see the quiet churchyard

:45:04.:45:09.

down below You are very proud of your Welsh

:45:09.:45:14.

heritage, aren't you? I am incredibly proud. I don't think I

:45:14.:45:21.

should be afraid of having an ambassadoral shoulder that carries

:45:21.:45:25.

something that Wales can give, maybe that's a little bit in this

:45:25.:45:29.

festival, here in this corner of London. I have even started a

:45:29.:45:34.

foundation now for young singers. The talent that comes from this

:45:34.:45:38.

small country is magnificent. And going back to my foundation, I

:45:38.:45:45.

would like to even have the tip of Kiri Te Kanawa's foundation in New

:45:45.:45:48.

Zealand. Maybe will I become a politician, will I run an Opera

:45:49.:45:53.

House towards the end of my career? I don't know. Maybe I should start

:45:53.:46:03.
:46:03.:46:16.

opening books and reading about it Fantastic, weren't they brilliant.

:46:16.:46:21.

I love him, I really love him. We admire, oh my God. He can move to

:46:21.:46:28.

characters, and we will have a lot of fun, let's go one more time.

:46:28.:46:38.
:46:38.:47:07.

Bryn Terfel with Kirsty there. That's all from Newsnight tonight,

:47:07.:47:16.

we leave you with a bit of Olympics, the official Olympic song was

:47:16.:47:23.

unveiled and the bridge was raised, the song is Survival:

:47:23.:47:26.

# Life's race # I'm gonna win

:47:26.:47:29.

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