November 19, 2022

Barclays CEO Leaves Due to Findings of Epstein Probe

Barclays CEO Jes Staley has resigned after the bank was found to have violated U.S. sanctions against Russia, Iran and Libya by doing business with Jeffrey Epstein. The probe into Staley’s conduct is being led by Britain’s Financial Conduct Authority (FCA) which oversees banks in the UK, as well as criminal investigators from the United States Department of Justice (DOJ).

The recent decision was made by Barclays’ board that Staley must step down and the American banker duly obliged. His resignation is effective immediately and he will be replaced by Tim Throsby, currently head of retail banking and wealth management, as interim CEO until a full-time replacement is found.

In a statement from the bank’s chairman John McFarlane, Barclays said:

The Board has concluded that Jes Staley did not act with a lack of integrity or improperly prioritise his own interests over the interests of the bank. However, he made a mistake in becoming involved with certain individuals in relation to whom he had become aware of allegations of previous misconduct and thus failed to meet the standard of Barclays , which places the interests of customers at its heart.

The Board is fully supportive of Jes Staley and his leadership of Barclays .

It was revealed on Wednesday that Mr Staley had attempted to identify an employee whose whistleblowing directly led the DOJ’s probe into Barclays’ activities. The U.S. Department said it was “outrageous” that Barclays had tried to find the informant.

The DOJ did not fine Barclays but issued a public censure and required changes to its compliance programme, adding it would monitor the bank’s adherence to its obligations under the agreement for at least two years or more should there be future violations. Barclays said it has apologised to the staff member involved and that it has no other indication there was any inappropriate action against other whistleblowing cases.

Staley had started in his role as CEO at Barclays in December 2015 and earlier this year had been named by Financial News as its European Banker of the Year. He will remain on the bank’s board for another year while Barclays conducts an external search for his successor.

On Wednesday Britain’s FCA said it had found that Staley breached the requirement to act with due skill, care and diligence when responding to a whistleblowing complaint in 2016 about his attempt to identify an anonymous whistleblower who was also a former employee of the bank.

As part of the FCA probe, Staley’s pay will be docked by around £500,000 ($650,000) for his role in the incident. The amount is equivalent to one tenth of his annual base salary (£1.6 million).

The bank added that it had received written confirmation from Jes Staley that he does not accept any finding that he acted in good faith with the intention of protecting the Bank.

Barclays is profoundly sorry for these errors, it said . The board acknowledges that this represents a stain on the bank’s reputation. It has offered its sincere apologies to the two individuals involved who have shown great courage in bringing this matter to light.