Oakeshott had somewhat undermined the government's claims of a great triumph in its Project Merlin deal with the Banks, telling BBC News that
"If this is robust action on bank bonuses then my name's Bob Diamond"(the chief executive of Barclays).
"His name clearly isn't Bob Diamond", said Danny Alexander, in a punchy rebuttal of why he regarded the comments as "completely wrong".
And so the "mutual consent" departure took place.
Yet the LibDems claimed that there was little need for it, as it had already taken place nine months ago, as PoliticsHome reported the party has now made the extremely silly claim that he had not been authorised to speak for the party on Treasury issues, but had "overstepped the mark" with the media.
Lord Oakeshott has not been treasury spokesman for the Liberal Democrats since before the election and has "overstepped the mark" in his dealings with the media, a Lib Dem spokesman has told PoliticsHome.
Contrary to earlier media reports, Lord Oakeshott's position in the Liberal Democrat treasury hierarchy has not been greater than an informal role as Lord Newby's number two in the party's treasury backbench committee. A Lib Dem source said he is "no longer continuing in that position".
The claim that Oakeshott has acted as an impostor since the election is the most incredible development in the resignation - and lacks all credibility.
Firstly, Danny Alexander seemed unaware of this earlier tonight, when he said that Oakeshott had only just departed the role.
Appearing on BBC News, Mr Alexander later said the bank deal was "something the Liberal Democrats strongly support and Matthew Oakshott felt unable to do so and as a result he is no longer the Treasury spokesman in the House of Lords by mutual agreement".
And there is no evidence that the party made any attempt whatsoever to attempt to correct the description used in every national newspaper and news agency, and on the major news programmes such as Newsnight, where Oakeshott gave an enormously punchy performance last month, promising to fight and fight again to save the pledges on the banks made in the Coalition Agreement.
There are no known previous examples of a party having a senior figure speak for months as a "Treasury spokesman" to the Financial Times, Guardian, Evening Standard, Times, Independent and Telegraph, Sun and Mail while simply shrugging their shoulders and ignoring the unfortunate mistake, presumably hoping that it would go away.
It seems that Oakeshott even deceived the most well informed party insiders including LibDemVoice editor Mark Pack into using the description.
It is not yet known whether the party intends to refer the case of this almsot universal misreporting of the impostor spokesman to the Press Complaints Commission.