Ex-Barclays boss case against FCA over relationship with Epstein goes to court
Former Barclays CEO James ‘Jes’ Staley is seeking to overturn a ban that prohibits him from holding senior leadership after he was found to have misled his relationship with Jeffrey Epstein.
In October 2023, the Financial Conduct Authority (FCA) decided to fine Staley £1.8m and ban him from holding a senior position in the financial sector.
It was found that he “recklessly approved a letter sent by Barclays to the FCA”, which contained two misleading statements about the nature of his relationship with Epstein.
The watchdog had asked Barclays in 2019 to explain the relationship between the pair.
In 2008, Epstein pleaded guilty to soliciting sex from girls as young as 14. He was later arrested in July 2019, on federal charges for the sex trafficking of minors in Florida and New York, but died in his jail cell on 10 August.
In a statement at the time, the letter claimed that Staley did not have a close relationship with the child sex offender, but in emails between the two, Staley described Epstein as one of his ‘deepest’ and ‘most cherished’ friends.
The letter to the FCA also claimed Staley ceased contact with Epstein well before he joined Barclays.
Still, it was later established that he had contact with Epstein in the days leading up to his appointment as CEO being announced on 28 October 2015.
Staley joined Barclays in December 2015 after being the former chief executive of JP Morgan.
The bank had already suspended all of Staley’s deferred bonuses and long-term share awards, but following the news of the FCA decision, it confirmed it would scrap a series of payouts to Staley worth £17.8m.
Staley referred the decision notice to the Upper Tribunal, where he will present his case.
“The Tribunal is empowered not simply to review the FCA’s decision, but to consider the case from scratch and make findings of fact and law,” explained David Hamilton, partner at Howard Kennedy.
He noted that “Staley will still need to be careful that the explanations he provided the FCA regarding his relationship with Epstein, Barclays’ response to the FCA’s enquiry… and his involvement in and understanding of that response.”
“Whilst it is open to Staley to advance new arguments if e.g., new evidence were to have come to light following the FCA’s decision notice, or to bring out particular emphases in how he presents his evidence, it is always a bit of a tightrope.”
“Material divergence from earlier testimony, at least without reasonable cause, can be treated by the Tribunal as a separate ground to question a subject’s fitness and propriety,” he added.
Bank of England governor Andrew Bailey, former FCA chief executive between 2016 and 2020, and current Barclays chair Nigel Higgins have provided witness statements to the Tribunal.
The parties will be in front of Judge Herrington later this morning in court one at the Rolls Building.