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Barclays bank/Wikimedia
(qlmbusinessnews.com via theguardian.com – – Fri, 20 Apr 2018) London, Uk – –
City watchdogs say he broke rules of conduct in his attempts to identify 2016 whistleblower
Barclays’ chief executive, Jes Staley, is facing a financial penalty for an alleged breach of conduct after City watchdogs completed an investigation into the banking boss’s attempts to identify a whistleblower in 2016.
Barclays said the Financial Conduct Authority and Prudential Regulation Authority (PRA) are alleging that Staley’s actions were a breach of an individual conduct rule that relates to a “requirement to act with due skill, care and diligence”. The size of the penalty has not been disclosed.
The bank stressed, however, that regulators are not alleging that he acted with a lack of integrity or that he lacks fitness and propriety to continue in his role as chief executive.
Barclays said its board “continues to have unanimous confidence in Mr Staley” and is still recommending that shareholders back his re-election at the company’s annual general meeting (AGM) on 1 May.
Staley now has 28 days to respond to warning notices issued by the two regulators.
Barclays Bank, which was also the subject of an inquiry following Staley’s attempts to identify a whistleblower, is not facing any enforcement action by the FCA or PRA.
“However, they have proposed that each of Barclays Bank PLC and Barclays Bank UK PLC will be subject to requirements to report to the FCA and PRA on certain aspects of their whistleblowing programmes,” the lender said.
“Barclays continues to provide information to, and cooperate with, authorities in the US with respect to this matter,” it added.
It is extremely rare for financial regulators to investigate and censure chief executives in the City.
This week, before the outcome of the regulators’ investigations became public, an influential advisory group – Institutional Shareholder Services (ISS) – called for a vote in favour of Staley at next month’s AGM “even though it is not without concern for shareholders”.
Its support was based on views that the company and chief executive were cooperating with authorities and that the bank had strengthened its whistleblowing programme.
Commenting on the regulators’ notices on Friday, Barclays highlighted that in May 2017, “the Barclays board voluntarily commissioned independent reviews of Barclays’ whistleblowing policies, processes and controls, in line with which certain enhancements have subsequently been made”.
Staley twice attempted to use Barclays’ internal security team to track down the author of two anonymous letters sent to the board and a senior executive at the bank in June 2016.
Barclays announced to the stock market in April last year that Staley and the bank were under investigation by the FCA and the PRA for the affair. New York’s Department of Financial Services was also looking into Staley’s behaviour.
In an internal email to Barclays staff, Staley tried to justify attempting to find the author of the letters, accusing the whistleblower of harassment and trying to “maliciously smear” Tim Main, who is chair of Barclays’ financial institutions group in New York. Main had previously worked with Staley at the US investment bank JP Morgan.
Staley wrote: “The allegations related to personal issues from many years ago, and the intent of the correspondents in airing all of this was, in my view, to maliciously smear this person.
“In my desire to protect our colleague, however, I got too personally involved in this matter … This was a mistake on my part and I apologise for it.”
