This article is more than 8 years old

This article is more than 8 years old

Vince Cable has called for a criminal investigation into the conduct of the Barclays bankers responsible for rigging key interest rates.

The business secretary said the public would not understand why people were jailed for petty theft while bankers were getting off, "having perpetrated what looks like conspiracy".

And he said he agreed with Lord Blair, the former Metropolitan police commissioner, who said there appeared to be evidence that Barclays employees were engaged in conspiracy to defraud.

In an interview with Sky's Dermot Murnaghan, Blair said: "There have to be police inquiries into this.

"Anybody, the youngest detective, would say this is conspiracy to defraud. It can mean nothing else. And therefore someone has to launch a criminal inquiry into this behaviour."

Speaking on the same programme, Cable said "his instincts" were to agree with Blair, and that members of the public would expect a criminal investigation too.

"They just can't understand why people are thrown into jail for petty theft and these guys just walk away having perpetrated what looks like conspiracy," Cable said.

Barclays has been fined £290m in the UK and the US for its "serious, widespread" role in manipulating two City interest rates used to determine the cost of borrowing. Investigations into other banks are continuing.

In a statement to the Commons on Thursday, the chancellor, George Osborne, played down the prospects of any of those involved facing criminal prosecution because rigging Libor [the London interbank offered rate] is not a criminal offence under the City's regulatory regime.

As well as expressing his personal support for a criminal investigation, Cable said he had been told that the Serious Fraud Office was having "a fresh look" at the evidence produced by the Financial Services Authority (FSA) investigation into Barclays.

He also said there was "an awful lot of cleaning up still be be done" in the City.

In a separate interview on Sunday, on the BBC's The Andrew Marr Show, Lord Turner, the chairman of the FSA, said regulation needed to be tightened "considerably" in this field.

"If you go back over 20 years, we started with, in these sort of areas, a very light-touch, self-regulatory approach. And slowly over the last 15 years or so we have toughened our approach," Turner said.

"The 1997 act was a toughening. Further steps were made a few years ago to give us the ability to bring criminal charges in particular areas of market abuse. But they did not cover the Libor market.

"I think we now have to look further and see whether we should strengthen these powers considerably on top of what we have now got at the moment."

Osborne told MPs last week the government would consider creating new criminal sanctions "for the directors of failed banks where there is proven criminal negligence".

Turner said he also understood the government would accept an FSA proposal saying that in future, if a bank fails, there should be a presumption against the directors being allowed to carry on working in the industry again.