Jes Staley: Barclays CEO quits after investigation into hyperlinks with Jeffrey Epstein

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The investigation by the Monetary Conduct Authority (FCA) and the Financial institution of England’s Prudential Regulation Authority (PRA) was disclosed by Barclays in early 2020 and centered on how Staley had characterised the connection to his employer.

Barclays and Staley had been made conscious on Friday night by the FCA and the PRA of the preliminary conclusions of their investigation.

“In view of these conclusions, and Mr Staley’s intention to contest them, the board [of Barclays] and Mr Staley have agreed that he’ll step down from his function as group chief govt and as a director of Barclays,” Barclays stated in its assertion on Monday.

“It needs to be famous that the investigation makes no findings that Mr Staley noticed, or was conscious of, any of Mr Epstein’s alleged crimes, which was the central query underpinning Barclays’ assist for Mr Staley following the arrest of Mr Epstein in the summertime of 2019,” the financial institution added, saying it was not applicable for it to remark additional.

A spokesperson for the FCA and PRA stated the regulators “don’t touch upon ongoing investigations or regulatory proceedings” past confirming the actions detailed within the assertion from Barclays.

Relationship started at JPMorgan

Epstein, a multimillionaire and convicted pedophile who was charged with sex trafficking by US federal prosecutors, died in a New York jail cell in 2019 whereas awaiting trial.

Staley had been operating Barclays since late 2015. Previous to that he labored for greater than 30 years at JPMorgan (JPM), the place he served as head of its funding banking division. His relationship with Epstein dated again to 2000, when he turned head of JPMorgan’s non-public financial institution.

“He was already a shopper. The connection was maintained throughout my time at JPMorgan, however as I left Morgan it tapered off fairly considerably,” Staley advised reporters on a name in February 2020.

Requested then whether or not he regretted his relationship with Epstein, Staley stated: “Clearly I believed I knew him nicely and I did not. And for positive with hindsight of what everyone knows now I deeply remorse having had any relationship with Jeffrey Epstein.”

Staley had advised the Barclays board that he had no contact with Epstein since turning into Barclays CEO in December 2015.

“Though element is proscribed, it seems regulators imagine there was a definite lack of transparency over this relationship,” stated Susannah Streeter, senior funding and markets analyst at UK dealer Hargreaves Lansdown. “It is understood Mr Staley will contest the conclusions, and clearly the board wish to distance Barclays from what may very well be an extended drawn out course of.”

The Wall Avenue veteran had run into bother with UK regulators beforehand. In 2018, the FCA fined him about $870,000 after it emerged that he had tried to establish a whistleblower on the financial institution. Staley had tried to search out out who had authored an nameless letter that raised issues a few senior Barclays worker.

He apologized for his conduct and admitted that he had “made a mistake.” Barclays clawed again about $680,000 of his 2016 pay over the incident.

Barclays shares drop

However his loss is a giant blow to one of many few European corporations nonetheless dedicated to competing with the most important American funding banks.

Barclays shares fell by as a lot as 3.7% in London and had been final buying and selling down 1.5%. They’ve jumped 35% to date this yr, a part of a broader rally in financial institution shares fueled by the financial restoration.

“The [Barclays] board is disenchanted at this end result,” the financial institution stated in its assertion. “Mr Staley has run the Barclays Group efficiently since December 2015 with actual dedication and talent. Supported by the senior workforce which he largely helped construct and on whom the Barclays Group might be relying for the longer term, Mr Staley clarified the Barclays Group’s technique, reworked its operations and materially improved its outcomes. “

With impact from November 1, 2021, C.S. Venkatakrishnan will take over as Barclays CEO, topic to regulatory approval. Venkat, as he’s identified on the financial institution, beforehand served as head of world markets at Barclays from October 2020 and as group chief threat officer from 2016 to 2020. Previous to becoming a member of Barclays in 2016, he labored at JPMorgan Chase from 1994.

Staley will obtain his annual mounted pay price £2.4 million ($3.3 million) in money and shares, plus a pension allowance of £120,000 ($164,000) and different advantages till October 31, 2022. He can even be eligible for the prices of relocating to america.

“No choices have but been made in respect of any additional remuneration funds to be made to Mr Staley,” Barclays added.

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