Former Barclays boss Jes Staley fined £1.8m over Jeffrey Epstein scandal

Former Barclays boss Jes Staley fined £1.8m over Jeffrey Epstein scandal

12 Oct    Finance News, News

The Financial Conduct Authority (FCA) has fined former Barclays boss James Staley, £1.8m and banned him from holding top jobs in the finance industry after finding he misled them over his relationship with convicted sex offender Jeffrey Epstein.

The FCA found that the executive ‘recklessly approved’ a letter sent by Barclays to the FCA, which contained two misleading statements about the nature of his relationship with Jeffrey Epstein which hid the last contact he had with the disgraced financier.

It also concluded the bank boss acted “with a lack of integrity.”

Therese Chambers, joint Executive Director of Enforcement and Market Oversight at the FCA said: “A CEO needs to exercise sound judgement and set an example to staff at their firm. Mr Staley failed to do this. We consider that he misled both the FCA and the Barclays Board about the nature of his relationship with Mr Epstein.

“Mr Staley is an experienced industry professional and held a prominent position within financial services. It is right to prevent him from holding a senior position in the financial services industry if we cannot rely on him to act with integrity by disclosing uncomfortable truths about his close personal relationship with Mr Epstein.”

Epstein was convicted in a US in 2008 of procuring a child for prostitution and of soliciting prostitutes as part of a controversial plea deal despite the fact investigators linked him to 36 victims, some as young as 14.

He was later rearrested on sex trafficking of children charges in 2019 but died in jail cell in New York before he could stand trial.

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The watchdog asked Barclays in 2019 to explain what it had done to satisfy itself that there was no impropriety in the relationship between Mr Staley and Mr Epstein. In its response, Barclays relied on information supplied by Mr Staley. Mr Staley confirmed the letter was fair and accurate.

The letter claimed that Mr Staley did not have a close relationship with Mr Epstein but emails emerged between the two in which Mr Staley described Mr Epstein as one of his “deepest” and “most cherished” friends.

The letter from Barclays also claimed Mr Staley ceased contact with Mr Epstein well before he joined Barclays but it was also revealed that Mr Staley was in contact with Mr Epstein in the days leading up to his appointment as chief executive being announced on 28 October 2015. Mr Staley joined Barclays in December 2015.

The FCA said that while Mr Staley did not draft the letter “there was no excuse for his failure to correct the misleading statements when he was the only person at Barclays who knew the full extent of his personal relationship with Mr Epstein and the specific timings of his contact with him”.

The watchdog concluded the executive was aware “of the risk his association with Mr Epstein posed to his career.”

It found that “in failing to correct the misleading statements in the letter, Mr Staley recklessly misled the FCA and acted with a lack of integrity.

The FCA said James Staley was appealing the FCA decision “where he will present his case.”

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In a statement, the Bank of England said: ““We support the FCA’s decision announced today against Jes Staley. It is imperative that senior managers act with integrity and are open and cooperative with the regulators.”

Barclays said after the FCA’s decision, it decided Mr Staley was ineligible for, or would forfeit, bonuses and share awards totalling £17.8m.

The banking giant had already suspended all of Mr Staley’s deferred bonuses and long-term share awards while the watchdog investigated

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