Libor scandal pay-out by ICAP is 'embarrassment' for Tories
Labour demands Tories return £4.8m donations from Michael Spencer whose firm is embroiled in scandal
AS one of London's richest and most high-profile businessmen, Michael Spencer is accustomed to winning. But the decision by his broking firm ICAP to reach a $100 million settlement over the Libor rate-fixing scandal is a "personal blow", the Financial Times says.
The settlement is also an "embarrassment" for the Tory party because Spencer, 58, is its former co-treasurer and one of its most prominent donors. He remains the chairman of the Conservative Foundation, an organisation set up to support the party's financial future.
The timing of the settlement is also an issue. It comes hard on the heels of a Labour conference "dominated by attacks on big business and policies designed to protect consumers and small business from vested interests", the Financial Times says. The Tories' own conference - an event Spencer has attended for two decades - begins in Manchester in just three days.
Labour has wasted no time seeking to make political capital from the situation. It has demanded the Tories return £4.8 million in donations Spencer has made to Conservative coffers.
Michael Dugher, Labour's vice-chair, claimed David Cameron had "fought tooth and nail" to avoid a proper inquiry into the rigging of interest rates. If the PM failed to return Spencer's cash now that the scandal had "engulfed one of his big donors" it would prove that he only cares about "the privileged few", he said.
The Conservative party has refused to return Spencer's donations, but "sought to distance itself" from the businessman by "refusing to publicly defend the former co-treasurer", the Financial Times says. It insists the Libor scandal is a "matter for ICAP".
Spencer's reputation as a high-profile Tory in the City will be hard to downplay, however. He retains strong links with some of the party's most senior figures, including George Osborne, and is described as a "good friend" of the PM by Francis Maude, minister for the Cabinet Office.
Spencer insists he's the right man to lead ICAP despite a settlement that will consume four per cent of its turnover and the criminal indictment of three of its former employees.
The Financial Times says it would be wrong to write off the "fiercely competitive outsider". Spencer, it says, is a man "who has spent a lifetime bouncing back from setbacks". ·