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NEWS
Barclays slapped with fraud charge for 2008 crisis dealings
have been charged with fraud due to actions taken during the 2008 financial crisis.
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The case, led by the UK’s Serious Fraud Office (SFO), relates to the billions of pounds the bank raised from Qatari investors to avoid a government bailout. It is the first example of criminal charges being filed against a bank for the 2008 crisis.
More than £6.1 billion was pumped into Barclays during fund raisings in June and October. In November 2008 Barclays agreed to provide a loan facility worth $3 billion to the state of Qatar.
In the firing line are John Varley, Barclays’ former chief executive; Roger Jenkins, former senior investment banker; Thomas Kalaris, a former chief executive of Barclays’ wealth ops, and Richard Boath, the ex-European head of financial institutions.
Barclays, Varley and Jenkins are charged with three counts of conspiracy to commit fraud by false representation plus one count of unlawful financial assistance. Boath and Kalaris are charged with a single count fraud by false representation.
Qatar calling
All four defendants are due to appear before Westminster Magistrates Court on 3 July 2017. Brad Kaufman of Greenberg Traurig, Roger Jenkins’ lawyer, said that his client plans to “vigorously defend” against the charges.
“As one might expect in the challenging circumstances of 2008,” he added. “Mr Jenkins sought and received both internal and external legal advice on each and every aspect of the accusations levelled today by the SFO.”
Qatar Holding, owned by then-Sheikh Hassim bin Jassim bin Jabr al-Thani, invested billions in Barclays over the course of 2008. The bank’s side-deals in Qatar, only
arclays and four of its former executives
partially disclosed at the time, added up to a value of £2.4 billion.
The deals sparked the SFO probe as
well as an investigation from the Financial Conduct Authority (FCA). The latter case explored whether Barclays had secretly loaned money to Qatar for it to reinvest in the bank.
The FCA investigation into the bank is ongoing. The watchdog released a statement in 2013 that it would fine the bank for wrongful disclosure, but held back to allow the SFO to continue its own probe.
A thousand fines
Despite posting profits that have almost tripled this year, Barclays is still in danger from numerous fines and penalties. The bank, which is still struggling to repair its reputation after the Libor rate-fixing scandal, is in the midst of a hefty fight with the US Department of Justice and the UK’s Serious Fraud Office.
Chairman John McFarlane didn’t give the specifics of the legal challenges at large, but did admit that “a number of potentially material legacy conduct matters need to be resolved at acceptable cost” before Barclays is in the clear.
Under new Chief Executive Jes Staley, the bank has been peeling back on its overseas operations to save costs, especially in Africa.
Staley also sliced away 15,000 jobs in 2016 by putting a freeze of hiring. His actions haven’t stopped complaints about Barclays shelling out huge figures to its staff in payments. Stanley received £4.2 million for his first year in charge, while 365 of the bank’s workers were paid more than a million.
www.ibsintelligence.com © IBS Intelligence 2017
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