The Bank of England governor has said he would have put off a meeting with Nigel Farage last autumn had the Reform UK leader’s £5m gift from a crypto billionaire been under investigation at the time.
Andrew Bailey said he did not regret meeting Farage to discuss the Bank’s plans for cryptocurrency regulation last September, months before the controversial donation from the Thailand-based investor Christopher Harborne was revealed by the Guardian in April.
However, Bailey said he would have considered delaying the meeting had the central bank known what it knows today: that a parliamentary inquiry would be launched over the undisclosed gift from Farage’s wealthy benefactor, who has made a large part of his estimated £18bn fortune from crypto.
In an interview with the Guardian, Bailey said: “Whether I would have then said: ‘Well, I think we’d better wait until the investigation is done before we have the meeting’ – I think that would be a judgment we would have taken at the time.
“It would have been a material fact, certainly, in our judgment.”
Bailey, who also serves as head of the international watchdog the Financial Stability Board, has previously assured that he is “able to spot” and resist lobbying and did not bow to Farage.
Farage has said he used the meeting in September to demand the Bank of England drop plans for a state-issued rival to a stablecoin issued by Tether. Harborne, who has provided two-thirds of Reform UK’s funding, appears to make as much as £1bn a year from his shareholding in Tether.
Stablecoins are cryptocurrencies whose value is typically pegged to an asset or a currency such as the US dollar and tend to be used as an intermediary between state currency and crypto transactions.
Farage has also said he urged Bailey to abandon plans for a cap on how many stablecoins individuals in the UK could own, which was eventually dropped by the Bank after a consultation. Bailey has defended those changes, saying it was easier to set caps on the total number of stablecoins issued, rather than policing individual holdings.
The governor said it had been a “perfectly polite exchange of views” but that Farage’s stance on the Bank was clear. “His argument, as I interpreted it, is that there is ‘an establishment’ and he presumably thinks that we’re part of it.”
As for the Bank’s latest rules on stablecoins such as Tether, Bailey said he had not discussed them with the Reform UK leader. “I don’t know where Nigel Farage is on that, or where we have got to now … I haven’t talked to him about it,” he said.
“I’ve been interested, with the release of our proposed rules, that one or two people who are criticising us for being dinosaurs have now sort of come out with rather grand statements the other way around, saying that we’re great at innovation, which is quite amusing.
“I do actually think we’re encouraging innovation, so I think we are doing the right thing there.”
Farage has now been reported to the standards commissioner over whether he lobbied the Bank against parliamentary rules. However, Bailey said the controversy over the meeting would not spark any change about how the Bank booked and conducted meetings with political figures, which it did regularly and without “favouritism”.
“People come in here and tell me and my colleagues things which are very market-sensitive. And we have a degree of confidentiality around it. So I’m very keen that we preserve the fact that people can come into the Bank of England and tell us things and it doesn’t immediately get on to the public record. I know that can sound difficult to say in the wrong circumstances, but it is important,” he said.
“We do have a responsibility as a public authority to be open to the leaders of parties in the Westminster system. I think that’s fine. I think we must do that.”
