Ex-Barclays chief Jes Staley banned for misleading watchdog over Epstein

The UK’s financial regulator has banned former Barclays chief executive Jes Staley from senior roles in financial services and fined him £1.8 million (€2.1 million) for allegedly misleading the watchdog about his past relationship with Jeffrey Epstein.

Barclays said in light of the decision by the Financial Conduct Authority (FCA) that Mr Staley would have to forfeit as much as £17.8 million (€20.6 million) in deferred pay.

The FCA said on Thursday that Mr Staley “recklessly approved” letters sent to the regulator by Barclays’ board containing “two misleading statements about the nature of his relationship” with deceased sex offender Epstein, with whom he had close ties during his time at JPMorgan Chase, before he joined the British lender.

“A CEO needs to exercise sound judgment and set an example to staff at their firm. Mr Staley failed to do this,” the FCA said in a statement. “We consider that he misled both the FCA and the Barclays board about the nature of his relationship with Mr Epstein.”

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Supervisors concluded that “we cannot rely on him to act with integrity by disclosing uncomfortable truths about his close personal relationship with Mr Epstein”.

Mr Staley said he was “disappointed” by the FCA decision and that he would appeal against it. He has referred the case to the FCA’s upper tribunal, which hears challenges to FCA penalties.

“If I had known who Jeffrey Epstein really was, there is absolutely no doubt that I wouldn’t be in the position I am in today,” Mr Staley said in a statement.

“Prior to undertaking my former role, it was known that I had had a relationship with Epstein. I have worked tirelessly over the last 43 years and have genuinely supported many people/social causes, where others might not have done so.”

In a statement, Barclays said that in light of the decision, Mr Staley would forfeit or be ineligible for £17.8 million of his deferred pay that it had previously frozen. That includes his 2021 bonus and various unvested long-term incentive awards.

Epstein was until 2013 a key client of JPMorgan’s private bank, which Mr Staley used to run. The pair developed a close relationship, and Mr Staley both visited Epstein in prison and sailed to the sex offender’s island with his family on his yacht in 2015.

Mr Staley stepped down in November 2021 to contest the allegations after Barclays was shown the preliminary findings of an FCA probe into his characterisation of his past dealings with Epstein.

The Financial Times reported the same month that, when at JPMorgan, Mr Staley exchanged 1,200 emails with Epstein between 2008 to 2012, with content that included unexplained terms, such as “snow white”.

In February, a lawsuit filed by the US Virgin Islands against JPMorgan revealed the full text of the emails, in which Mr Staley told Epstein: “I deeply appreciate our friendship. I have few so profound”.

The FCA cited this email as evidence that Mr Staley had misled the board into writing a letter that “claimed that Mr Staley did not have a close relationship with Mr Epstein”.

“We support the FCA’s decision announced today against Jes Staley. It is imperative that senior managers act with integrity and are open and co-operative with the regulators,” the Bank of England’s Prudential Regulation Authority said in a separate statement. – Copyright The Financial Times Limited 2023