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Sat, 11 July 2020

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John McDonnell brands Sajid Javid unfit to be Chancellor over Deutsche Bank 'greed'

John McDonnell brands Sajid Javid unfit to be Chancellor over Deutsche Bank 'greed'
2 min read

Labour's John McDonnell has accused Chancellor Sajid Javid of being implicated in "some of the worst excesses of the casino economy" during his time as a banker.


The opposition frontbencher has written to Boris Johnson to take aim at Mr Javid's pre-politics record at Deutsche Bank, and said the Chancellor had questions to answer over a tax avoidance scheme used by the outfit.

But the Conservatives said Labour should think about "their own credentials for governing" and posed a "threat to the UK economy".

In a letter to the Prime Minister seen by The Guardian, the Shadow Chancellor highlighted Mr Javid's stint selling collateralised debt obligations (CDOs), a complex financial product seen to have played a key role in the 2008 financial crash.

“It will not be lost on those that have suffered the consequences of the last nine years of austerity following the 2008 financial crisis that the newly appointed chancellor profited from the greed that contributed to it," he said.

Mr McDonnell said Mr Javid, who rose to the board of Deutsche Bank during his time in the City, had been a senior office holder at the German outfit when a US Senate committee found it had caused "material damage to ordinary people and the wider global economy".

The Shadow Chancellor said his opposite number was therefore implicated in "some of the worst excesses of the casino economy".

Mr McDonnell also demanded that the Cabinet minister publish his tax return, and pointed to a 2014 Mail on Sunday report which said the then-Culture Secretary had been among senior Deutsche Bank staff paid bonuses through shares in a Cayman Islands company in a bid to reduce the company's tax bill. 

The Labour frontbencher said: "It critically undermines this government’s response to the scourge of tax avoidance for the chancellor to stand accused of this practise.

"Every penny avoided in tax by wealthy large corporations is a penny taken from our desperately underfunded public service."

'INCOHERENT'

But a Conservative spokesperson said Labour "might want to use the time better thinking about their own credentials for governing".

The spokesperson added: "Not content with antisemitism being rife in their party and their totally incoherent Brexit policy, the only threat to the UK economy is them.

"Their reckless plans would see debt soaring as they spend one thousand billion pounds, tax raids on hard working families and upheaval of our economic system by replacing key posts such as the governor of the Bank of England with their hard left choices. Utter disaster. If any party knows about failure and bogus investigations, it’s them."

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