Barclays CEO Staley departs after Epstein probe

By Lawrence White

LONDON (Reuters) – Barclays Chief Govt Jes Staley is leaving the bank following a dispute with British money regulators around how he explained his ties with convicted sexual intercourse offender Jeffrey Epstein.

Staley will be replaced as main executive by the bank’s head of world marketplaces C.S. Venkatakrishnan, who pledged on Monday to continue his predecessor’s approach for Britain’s third-greatest financial institution by current market benefit.

Staley’s shock departure will come following Barclays was educated on Friday of the unpublished conclusions of a report by Britain’s Financial Perform Authority (FCA) and the Prudential Regulatory Authority (PRA) into Staley’s characterisation of his romance with Epstein, who killed himself in jail in August 2019 when awaiting demo on charges associated to sexual intercourse trafficking.

“In perspective of people conclusions, and Mr Staley’s intention to contest them, the Board and Mr Staley have agreed that he will step down from his job as Group Main Government and as a director of Barclays,” the bank said.

“It should be famous that the investigation would make no conclusions that Mr Staley noticed, or was aware of, any of Mr Epstein’s alleged crimes, which was the central problem underpinning Barclays’ assist for Mr Staley pursuing the arrest of Mr Epstein in the summer of 2019,” it reported in a statement.

The investigation has however to be posted, while regulators have explained beforehand that it was focused on how truthful Staley was about his ties to Epstein.

If Staley is located to have misled regulators he could confront a fine, a ban from Britain’s financial market or each.

Barclays shares fell 2{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} adhering to the announcement, in advance of paring losses to trade down 1{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} at 1315 GMT, underperforming European rivals.

‘I Assumed I Realized HIM WELL’

Staley dealt with Epstein in the course of his long vocation at JPMorgan, exactly where Epstein was a major non-public banking customer until eventually 2013.

A college or university dropout who styled himself as a good financier, Epstein socialised in elite circles, which include with former and foreseeable future U.S. presidents. In 2008, he was registered as a sex offender but continued to retain ties with powerful gamers in company and finance.

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The New York Instances reported in 2019 that Epstein experienced referred “dozens” of wealthy purchasers to Staley. It described that Staley frequented Epstein in prison when he was serving a sentence concerning 2008-09 for soliciting prostitution from a slight, even though Bloomberg noted he frequented Epstein’s non-public island in 2015.

Staley informed reporters last February that his partnership with Epstein experienced “tapered off appreciably” soon after he still left JPMorgan in 2013, and that he had not observed the disgraced financier because getting over as CEO of Barclays in 2015.

“I assumed I realized him well, and I didn’t. I am absolutely sure with hindsight of what we all know now, I deeply regret having had any connection with Jeffrey Epstein,” he reported at the time.

Epstein’s back links with well known men have arrive back again to haunt some of them.

Leon Black, the billionaire investor, stepped down https://www.reuters.com/write-up/us-apollo-world wide-clayton-idUSKBN2BE1E0 from Apollo Worldwide Administration, the non-public equity organization he co-founded, earlier this yr immediately after an outside the house evaluate located he had paid Epstein $158 million for tax and estate organizing.

Britain’s Prince Andrew https://www.reuters.com/environment/british isles/prince-andrew-seeks-dismissal-accuser-giuffres-lawsuit-2021-10-29 has quit royal duties above his associations with Epstein when Microsoft co-founder Monthly bill Gates has claimed it was a “massive blunder” to devote time with the financier.

Britain’s FCA and PRA regulators mentioned in a statement they could not remark further on the Epstein investigation, which was released https://www.reuters.com/short article/us-barclays-benefits-idUSKBN2070NF immediately after JPMorgan offered them with e-mails between Epstein and Staley from Staley’s time as head of JPMorgan’s personal lender, the Economical Times noted last 12 months.

Appropriate Strategy

Staley explained to personnel in an internal memo seen by Reuters that he did not want his own reaction to the investigations to be a distraction.

“Despite the fact that I will not be with you for the up coming chapter of Barclays’ story, know that I will be cheering your accomplishment from the sidelines,” he explained.

Staley has 28 days to formally notify the FCA that he is contesting its conclusions, after which an impartial committee inside of the watchdog will uphold or reject its conclusions, a resource acquainted with the procedure explained to Reuters.

If upheld, the investigation passes to an independent Higher Tribunal which once again can back again or reject the findings, the source reported, in a process that could just take months.

The bank’s new CEO Venkatakrishnan, who adopted Staley to Barclays from JPMorgan and is acknowledged as Venkat, explained to staff members on Monday the system put in area by his predecessor was “the proper a single”, according to a independent memo also noticed by Reuters.

Venkat extra that he would announce adjustments to the organisation of the investment decision bank in the coming days, likely to necessarily mean filling his previous role and any other ensuing vacancies, resources at the bank explained.

Barclays’ share price has fallen 9{21df340e03e388cc75c411746d1a214f72c176b221768b7ada42b4d751988996} due to the fact Staley’s joined the bank just about six many years in the past, a tenure not with out controversy.

His finest accomplishment, insiders and analysts say, was to struggle off a campaign by activist trader Edward Bramson in 2018 to have Staley eliminated on the grounds that Barclays’ expenditure financial institution was underperforming and really should be slice again.

Bramson sold his stake before this year, and the bank’s new effects have revealed the investment decision lender accomplishing strongly.

Also in 2018, Britain’s fiscal regulators and Barclays fined Staley a combined 1.1 million lbs . ($1.5 million) right after he tried out to determine a whistleblower who sent letters criticising a Barclays worker.

(Reporting by Rachel Armstrong and Lawrence White Further reporting by Carolyn Cohn and Huw Jones Modifying by Louise Heavens, Kirsten Donovan and David Clarke)