Former Barclays boss Jes Staley fined and suspended by Jeffrey Epstein
- Staley fined £1.8m and banned for life
- FCA criticizes former Barclays boss over Epstein
- The bank strips him of 18 million pounds in bonuses
Staying silent: former Barclays boss Jes Staley
Former Barclays boss Jes Staley has been fined and banned from senior finance roles for misleading regulators about his friendship with pedophile Jeffrey Epstein.
In a damning report, the Financial Conduct Authority (FCA) said the banker acted “recklessly” and with a “lack of integrity” while at Barclays by insisting he was not close to the convicted sex offender.
Staley told regulators that his last contact with Epstein, who was also a friend of Prince Andrew, was “long before” he was named chief executive in October 2015.
In reality, emails between the two show that Staley described Epstein as one of his “deepest” and “dearest” friends. He was also in contact with Epstein three days before his appointment at Barclays was announced.
The FCA yesterday fined Staley £1.8m and banned him from holding any senior management position in finance.
“Mr Staley recklessly misled the FCA and acted with a lack of integrity,” it said. In response, Barclays said it would recover or cancel £17.8 million in bonuses and pay Staley was still due to receive.
Therese Chambers, the FCA’s deputy executive director of compliance and market oversight, said: “A chief executive must exercise good judgment and set an example for staff.” Mr. Staley did not do it.
“We consider that he misled both the FCA and the Barclays board about the nature of his relationship with Mr Epstein.”
He added: “It is right to prevent him from holding a senior position in the financial services industry if we cannot trust him to act with integrity in revealing uncomfortable truths about his close personal relationship with Mr. Epstein.”
Staley and Epstein met at the turn of the century, when the former was a director of the JP Morgan bank and the latter was a client.
Epstein was arrested in the United States on sex trafficking charges in July 2019 and committed suicide in prison the following month. He had already been convicted of child prostitution in 2008.
The FCA asked Barclays in August 2019 what it had done to ensure there was no wrongdoing in the friendship between Staley and Epstein.
In a letter approved by Staley, Barclays said it was not a close friendship and that their last contact had been “well before” the 2015 appointment as chief executive.
The FCA said these two statements were “inaccurate and misleading”. Staley plans to appeal the decision.
The regulator released excerpts of emails between Staley and Epstein as evidence.
In November 2009, a year after Epstein’s 2008 conviction, Staley wrote: “I owe you a lot. And I deeply appreciate our friendship. I have few so deep.’
In January 2015, Staley said: “The strength of a Greek army was that its core stood shoulder to shoulder and would not flee or break, no matter the threat. That’s us.’ In October 2015, before Barclays announced his appointment, he said: “You have never wavered in our friendship these last three years.” That also means a lot [sic] me.’
The pair discussed Staley’s career in October, including confidential information that he had landed the top job at Barclays, contrary to claims made in the letter to the FCA.
The regulator said Staley had misled Barclays.
He was “interested in giving Barclays the impression of greater distance… than he really was” and was “aware of the risk” his association “posed to his reputation and career”, it said. Through his lawyer, Staley said: “If I had known who Jeffrey Epstein really was, there is absolutely no doubt that he would not be in the position I am in today.”
‘Prior to assuming my previous role, I was known to have a relationship with Jeffrey Epstein. “I am very disappointed by the FCA’s decision and will continue to challenge it.”
Bank’s board of directors under fire for appointment
Barclays’ board faces fresh questions over its decision to hire Jes Staley.
Three days before he was officially appointed chief executive in October 2015, the Mail on Sunday revealed that Jeffrey Epstein was backing his bid for the top job.
Despite the links, Barclays chairman John McFarlane and nominations committee head Sir Michael Rake went ahead with the appointment.
On the day of the hire, Rake said: “I took the responsibility of finding an outstanding leader for Barclays very seriously. Jes Staley is the right man for that role.
In November 2021, Staley lost his job over his ties to Epstein.
Yesterday’s FCA report is also an embarrassment for current Barclays chairman Nigel Higgins, who replaced McFarlane in May 2019.
In August of that year, the FCA asked Barclays to explain what it had done to ensure there was no wrongdoing between Staley and Epstein.
The bank’s response, which was based on information provided by Staley, was “misleading”, the FCA said, leading to yesterday’s fine and ban.
Observers have suggested that the bank should have investigated Staley more.
Russ Mold, an analyst at AJ Bell, said: “The board needs to do the hard work.”
Conservative MP Iain Duncan Smith said: “This whole matter reflects poorly on the board.” It has caused untold reputational damage. The board has not done its due diligence.
“They didn’t want to know and that’s why they didn’t go to find out.”