EU probe launched into ECB links with private banks

EU Ombudsman Emily O'Reilly said Friday she has opened an investigation into ties European Central Bank President Mario Draghi and aides have with private banks following a complaint from a research group.

The non-government organisation Corporate Europe Observatory (CEO) filed the complaint over top ECB staff links to the Group of 30, which brings together the leaders of both the public and private financial sector.

"I have decided to open an inquiry into this complaint," O'Reilly said in a statement.

The CEO made a similar complaint in 2012 to her predecessor who cleared Draghi of any conflict of interest but filed a new complaint arguing that the ECB is now operating in a different context.

"I acknowledge the need to reflect on this new context. However, I have taken no position in relation to any of these matters except to consider that they warrant further inquiry," O'Reilly said.

Her office will ask the ECB to allow inspection of documents linked to the G30 as well as to meet with central bank officials to discuss aspects of the complaint, she said. 

Her office will then likely ask the ECB for a written response to the complaint.

"CEO research has exposed a severe lack of critical distance between the ECB’s decision-making bodies and corporate bankers in the G30," the NGO said. 

"As Europe’s central bank is tasked with regulating the financial sector and supervising other central banks in the Eurozone, any perceived or actual conflicts of interests pose a great risk to the ECB's integrity," the CECO said.

Members of the G30 include the heads of private banks UBS and JP Morgan, the governors of the central banks of England, Japan and China as well as other figures like former ECB president Jean-Claude Trichet, the Nobel economics prize winner Paul Krugman and former head of the US Federal Reserve, Ben Bernanke.

A spokesman for the ECB said: "We look forward to providing the Ombudsman with information on this matter."

Under EU treaties, the ECB is required to "maintain a dialogue with external stakeholders," and the G30 is a relevant forum to engage with, the spokesman said.

But he added: "We have a range of rules and instruments in place to avoid apparent or potential conflicts of interest.”