FCA fines Barclays £50m over 2008 Qatar deal

21st Oct 2022 09:40

(Sharecast News) - Barclays has been fined £50m by the City watchdog over its "reckless" conduct during a fund raising at the height of the 2008 financial crisis.

Barclays has appealed the fine to the Upper Tribunal, which will determine if the fine should be upheld, and if there are actions that would be taken against the regulator.

Concluding an investigation that launched in 2013, the Financial Conduct Authority said Barclays had failed to disclose certain arrangements agreed with Qatari entities as part of capital raisings announced between June and October 2008.

In doing so, Barclays' conduct had been "reckless and lacked integrity", the FCA said.

In particular, the FCA said Barclays had paid £322m in fees to one Qatari entity for participating in the capital raisings, which it did not disclose to shareholders.

"The FCA considers that it would have been highly relevant information to shareholders, investors and the wider market, especially in October 2008, in circumstances where the disclosed costs were already perceived to be very expensive," it noted.

Mark Steward, executive director of enforcement and market oversight at the regulator, said: "At the height of the financial crisis in October 2008, Barclays paid hundreds of millions of pounds in fees to certain Qatari investors, so that they would contribute new capital.

"Barclays did not inform the market and shareholders about these matters, as required. Barclays failure to disclose these matters was reckless and lacked integrity, and followed an earlier failure to disclose fees paid to Qatari investors in June 2008.

"There was no legitimate reason or excuse for failing to disclose these matters."

In a brief statement, Barclays confirmed that that the case had been referred to the Upper Tribunal for reconsideration.

In 2020, three former Barclays executives were acquitted of charges, brought by the Serious Fraud Office, that they helped funnel the fees to Qatar. Former chief executive John Varley was acquitted in 2019 for a lack of evidence, with the case against the bank dismissed in 2018.