Former Barclays boss Jes Staley has been fined £1.8 million ($2.2 million) and banned from the U.K. financial services industry after "recklessly" misleading regulators and the bank about his relationship with the late financier and sex offender Jeffrey Epstein.
The Financial Conduct Authority said Staley privately described Epstein as one of his "deepest" and "most cherished" friends. Yet he allowed Barclays to send a letter to the watchdog that distanced him from the financier, incorrectly stating that he'd ceased contact before joining the bank in 2015, according to the FCA.
"While Mr. Staley did not draft the letter there was no excuse for his failure to correct the misleading statements," the regulator said in a statement. "Mr. Staley recklessly misled the FCA and acted with a lack of integrity."
Barclays said in a separate statement that Staley should forfeit a number of awards including his bonus for 2021. Lapsed awards under the long-term incentive plan and forfeited deferred compensation were worth a total of £17.8 million, based on Monday's share price, it said.
Staley, who
"If I had known who JE really was, there is absolutely no doubt that I wouldn't be in the position I am in today," Staley said in a statement provided by his lawyers. "I am very disappointed by the FCA's decision and I will continue to challenge it."
The FCA's decision comes after years of scrutiny over Staley's ties to Epstein when he worked for JPMorgan Chase and what he told Barclays about the relationship when he joined.
The regulator published a report detailing the ties between the pair, including:
- Staley's family once flew on Epstein's private plane, which the CEO later revealed to senior Barclays staff
- Staley had detailed discussions with Epstein about his appointment at Barclays, including information he described as "very confidential"
- Between July 2008 and October 2015, Epstein and Staley exchanged more than 1,700 emails, including one sent three days before Staley was named as Barclays CEO.
Staley has said his relationship with Epstein "began to taper off as I left JPM and contact became much less frequent in 2013, 2014," before ending in 2015.
"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," Therese Chambers, joint executive director of enforcement and market oversight at the FCA, said in a statement on Thursday.
Barclays disclosed news of the regulators' probe to investors in February 2020, but Staley was allowed to continue in his role
Thursday's decision by U.K. regulators comes weeks after separate legal action over Epstein's banking relationships wrapped up in the U.S. JPMorgan
The Bank of England's Prudential Regulation Authority said in a separate statement it supported the FCA's decision. "It is imperative that senior managers act with integrity and are open and cooperative with the regulators," a PRA spokesperson said.
In 2008, Epstein was convicted of procuring a minor for prostitution by a Florida state court, and was arrested again in July 2019 on federal charges relating to, among other things, the sex trafficking of minors. The FCA "made no findings that Mr. Staley saw, or was aware of, any of Mr. Epstein's alleged crimes."
