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THREE RIVERS FAILS TO PROVE BANK MISTAKE

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Three Rivers DC has lost a claim for negligence against the Bank of England over its regulation of the Bank of Cred...
Three Rivers DC has lost a claim for negligence against the Bank of England over its regulation of the Bank of Credit and Commerce International.

The Court of Appeal ruled by a majority that the bank had not been guilty of misfeasance in public office for failing to regulate BCCI, which left losses of $13bn worldwide following its collapse in 1991.

Misfeasance is 'improper performance of an act that is lawful in itself'.

Three Rivers lost more than£2 million in the BCCI scandal. Liquidators Deloitte & Touche have so far recovered£1.2m but it is still owed more than£800,000.

Three Rivers was one of a number of councils, including Bury MBC and Harlow DC, which brought the original case against the Bank of England five and a half years ago.

At the time the then Bury finance director Brian Smallridge said: 'We have not said they are crooks. But we have said they have not regulated the crooks properly' (LGC, 28 May 1993).

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