Ordinarily, the resignation of an aggrieved journalist from a newspaper wouldn't cause much of a splash beyond themedia pages, says Press Gazette. ButPeter Oborne's outspoken departure from The Daily Telegraph, and his attack on the newspaper's integrity (see below), is a blow for its proprietors, the Barclay brothers. If nothing else, they must submit to having their business affairs raked over again.
The billionaire brothers, 80, are often called reclusive a term they are said to dislike. But it is easy to see how the public might come away with a different view. The brothers have bases in Monaco and, famously, Brecqhou a rocky outcrop off Sark, where they built a mock gothic castle only accessible by boat or helicopter.
"They live like Bond villains," noted The Guardian when the pair bought The Daily Telegraph in 2004. The castle "is not merely a watery tax haven but a means to protect their personal security".
Subscribe to MoneyWeek
Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE
Sign up to Money Morning
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter
The brothers "rarely venture even to Guernsey, except incognito", because they fear kidnapping. When a reporter scaled the cliffs, they "rained down a small blizzard of innovative writs" a frequently deployed tactic.
The brothers' relationship with the islanders of Sark, with whom they have clashed over constitutional and business affairs, is indicative of this combative streak. Yet acquaintances insist they are "warm and friendly".
Baroness Thatcher,who lived at the Ritz in the last months of her life, would doubtless agree. Certainly, as far asSir David is concerned, theirs is a straightforward working-class Tory fairy story: "A great example of what can be achieved in this country from humble beginnings."
Born in 1934 in Hammersmith to Scottish parents with eight other children, the twins were brought up in straitened circumstances, says The Observer. After leaving school at 16, they worked briefly in the accounts department of General Electric, before getting into the property game.
Their first big purchase, in 1975, was the Howard Hotel in London's West End a venture that led to many more hotel deals, culminating, in 1995, with the trophy purchase of the London Ritz.
By this time, they had also moved into media, buying The European newspaper from Robert Maxwell in 1992, The Scotsman in 1995 and The Daily Telegraph in 2004. A simultaneous move into retail saw them snap up Littlewoods, the mail order firm, in 2002 for £750m.
But controversy surrounds the offshore trusts that control many of their businesses. In 2012, Panorama claimed the Ritz hadn't paid corporation tax for 17 years. The Barclays are also embroiled in a £1.2bn dispute with HMRC over interest on a VAT rebate.
If they win, a ten-figure sum could be heading their way. If that happens, it might back up Sir David's 2004 assertion: "I don't think I've done anything dirty in my life."
A shameful shambles at The Daily Telegraph
When the Barclays bought The Daily Telegraph, the paper's long-standing writer Bill Deedes described the new regime in a memo to friends as "a stinking mob", says Tom de Castella in BBC News Magazine. "It struck me that what the Barclays saw in the Telegraph," Deedes wrote, "was an asset that in the right hands could be turned into a more profitable business."
The recent row has brought renewed focus to those words. Reportedly, editorial staff had long suspected that the paper was censoring articles about HSBC, a key advertiser. But Peter Oborne's denunciation of the failure to cover a high-profile story about HSBC facilitating tax avoidance proved explosive.
The paper had committed "a fraud on its readers", with dire implications for the future of a free press, claimed Oborne.
Why would a profitable newspaper owned by two billionaires "compromise its editorial integrity for a couple of million pounds in advertising money", ask Henry Mance and Claer Barrett in the FT. Perhaps more was at stake.
HSBC was pivotal in propping up Yodel a loss-making delivery business in the Barclays' empire. Yodel refinanced its £240m debt with HSBC in December 2012. According to Oborne, negative stories about the bank were discouraged "from the start of 2013 onwards".
The problem at the heart of the shambles is the role of the editor the "stalwart soul who's supposed to stand on the frontline defending journalism's values", said Peter Preston in The Observer. The damning fact at The Daily Telegraph is that, "lost in the melee of digital change", the paper doesn't have one.
The "editor-in-chief", Jason Seiken, doesn't sit on the editorial floor. "He's upstairs, alongside the CFO, trying to make more clicks and more bucks for the brothers." If serious newspapers are to survive, they have a duty of trust. "What the Telegraph lacks is a journalist who looks at the likes of HSBC and tells them to get stuffed as and when necessary."
-
M&S and Tesco among those warning of a £7bn Budget hitSeventy-nine UK retailers have written to Chancellor Rachel Reeves about possible price rises and job cuts - here is what it means
-
How much does it cost to move home under the Labour government?Home-moving costs are rising and could get more expensive once stamp duty thresholds drop in April 2025
-
Money Minute Friday 25 October: Banking results and German sentimentFeatures Today's Money Minute looks at third-quarter results from Barclays bank and advertising giant WPP, plus German consumer and business sentiment.
-
Edward Bramson: the quiet activist barging into BarclaysProfiles Edward Bramson may have failed to secure a seat on the board last week, but past form suggests his Sherborne investment fund will soon be back to shake things up.
-
Barclays is a strange beast – here's how to make it workOpinion Barclays is a weird hybrid creature, says Matthew Lynn. But an activist-led shake-up could turn it into a decent bank.
-
Barclays goes on trialFeatures Four former banking executives have been charged with fraud over the bailout of Barclays by Qatar in 2008. Will the trial really be in the public interest? Simon Wilson reports.
-
Barclays’ snooping scandal
Features Jes Staley, Barclays’ chief executive, tried to unmask the identity of a whistleblower. Bad move, says Ben Judge.
-
How Amanda Staveley helped save Barclays – and is now suing it for £1bn
Profiles Dealmaker Amanda Staveley was instrumental in helping to get Barclays out of its funding hole. But now she wants her share of the cash.
