Fraud Charges Related to Barclays Qatar Investments
A five-year investigation by Britain’s Serious Fraud Office (SFO) has led to criminal charges against Barclays and four former Barclays executives. The charges are related to the bank’s dealings with Qataris during the financial crisis.
SFO Charges 4 Former Barclays Executives
The SFO has charged the bank and two top executives with two counts of conspiracy to commit “fraud by false representation” and one of “unlawful financial assistance”. John Varley, the head of the bank, and Roger Jenkins, who headed Barclays’ investment banking and management businesses in the Middle East, are the implicated executives. In addition, SFO charged former executives Tom Karlaris and Richard Boath with “fraud by false representation.” These two have stated that they will contest the charges.
Remarkably, the criminal charges are the first of their kind to be leveled against the head of a big international bank as a result of the crisis.
Barclays Raised Equity from Qatari Investors
The charges are related to Barclays’ arrangements with the Qatari investors, including a loan of $3 billion dollars made to the Gulf state in November 2008.
When banks began to fail at the start of what was to become a global financial crisis, Barclays was one of the few banks to avoid a government bailout. As the crisis deepened, Barclays was able to escape taxpayer rescue by raising private equity to meet the higher capital targets set by regulators. The investments, notably, came from Qataris.
Prior to the November 2008 loan, Barclays agreed to pay £322m over five years to a Qatar Holding for advisory services in the Middle East in June and October of 2008. At the time, the first payment was disclosed, but the second payment and the fees were not.
That June, Barclays raised £4.5 billion from a variety of Qatari investors, including the state-owned Qatar Investment Authority (QIA) and Challenger, which represented Qatar’s then prime minister. A few months later, in October, the bank raised up to £7.3 billion more from additional investors, including Qatar Holding. Qatar Holding is an arm of the QIA, which owns just under 6% of Barclays.
Under investigation, The Financial Conduct Authority (FCA), a British regulator, and American authorities looked into the service agreements, resulting in a fine of £50m in 2013. The bank appealed.
Did You Invest with Barclays?
If you invested with Barclays or think you may be involved in securities fraud, you may have certain legal rights that require your immediate attention.
Call an Investment Fraud Attorney Today
If you are looking for an attorney to review your rights and options, the securities lawyers at Dimond Kaplan & Rothstein, P.A. have recovered over $100 million from banks and brokerages firms for their wrongful actions.