[ by Melanie Gretchen ] When Barclays former CEO Robert Diamond Jr. testified before Parliament last week, he said that the bank had a good relationship with the Financial Services Authority, Britain's securities regulator.  However, since then, on Tuesday Barclays ex-Chairman Marcus Agius – he resigned along with Mr. Diamond and COO Jerry del Missier – revealed that Mr. Diamond's position at Barclays has been under scrutiny by regulators since his appointment in early 2011. The Letter. On Tuesday, the Barclays released documents, not previously disclosed, showing that British regulators had questioned Mr. Diamond's management style on more than one occasion.  In late 2010, Mr. Agius received a letter from Hector Sants, who headed the FSA, urging that Mr. Diamond - who had recently been tapped as CEO of Barclays - have an "increased level of engagement" with authorities.  Regulators were expecting Diamond to "a close, open and transparent relationship" with them. In that same letter, Mr. Sants cautioned about Diamond's chumminess with top Barclays executives - COO Jerry del Missier and Rich Ricci, who replaced Mr. Diamond as the co-heads of the unit.  As the bank rose among the ranks of global leaders, regulators wanted to be sure that he would practice "clarity in oversight" over his colleagues. Barclays: Overly Aggressive. This April, FSA chairman Adair Turner, issued a letter to Mr. Agius, noting that the FSA had perceived certain bank practices as overly aggressive - he specifically referred to (i) Barclays' efforts to avoid paying around $774 million in corporate taxes, and (ii) some of the bank's accounting methods - "Barclays often seems to be seeking to gain advantage through the use of complex structures, or through regulatory approach which are at the aggressive end of interpretation of the relevant rules and regulations." Testifying before Parliament, Mr. Agius pointed to the letter as evidence of the bank's "strained relationship with the Financial Services Authority."  "What that letter is saying is that we overdid it," Mr. Agius told Parliament. A Contrasting Picture of Barclays. Yet, ex-CEO Diamond spoke to Parliament about his efforts to create a strong culture of integrity and trust, and told the politicians that he didn't recall the regulator ever raises concerns about the bank's activities or its internal culture, adding, "I knew nothing about it at the time that I was appointed." While Mr. Agius wouldn't comment on Mr. Diamond's honesty to the Parliamentary committee, he did succeed in passing the buck, saying the bank's board did not make decisions involving the setting of the Libor.  Rather, issues related to the rate were left by lower-level executives, whom he defended when asked why senior managers did not question decisions to report artificially low rates.

"I think it reflects the extraordinary times." -- Mr. Agius, referring to bank's management of many difficult situations after the collapse of Lehman Brothers in 2008.

Since the bank $450 million that Barclays paid to settle accusations by U.S. and U.K. authorities that it manipulated Libor, Mr. Diamond has announced he will forgo up to $31 million in stock bonuses.  Nevertheless, he will receive some $3.1 million, including one year's pay and a cash payment – approximately double what he is contractually owed. This is not what the sort of leadership that former SEC Director Lori Richards had in mind.   You can learn Ms. Richards point of view by clicking on reading the Who's News story, "Money And Greed: Stranglehold On Financial Services. Time To Recall Lori Richards, Former OCIE Director, And Her ‘Culture Of Compliance". For further details, go to [Dealbook, 7/10/12].