British financial regulators have said they are investigating Barclays Chief Executive Jes Staley and the bank itself over a whistleblowing incident.
The UK-based bank revealed that Staley had twice tried to identify an employee who had raised concerns about an executive hired by Barclays who had previously worked with Staley at JPMorgan Chase.
The bank said it had formally reprimanded its top boss for what it called a serious offence.
His pay will be “very significantly” cut, but the bank said it intends to support his reappointment at its annual general meeting next month.
“I have apologised to the Barclays Board, and accepted its conclusion that my personal actions in this matter were errors on my part,” Staley said.
The investigation relates to anonymous letters sent in June 2016 to members of the board and a senior executive that raised concerns about a senior employee who had been recruited by Barclays earlier that year, the bank said.
Barclays did not name that executive but a person familiar with the matter told the Reuters news agency the letters were about Tim Main, who Staley worked with at JP Morgan. Main was hired in June 2016 as chairman of Barclays’ financial institutions group, based in New York.
“Amongst other issues, the letters raised concerns of a personal nature about the senior employee, Mr Staley’s knowledge of and role in dealing with those issues at a previous employer, and the appropriateness of the recruitment process followed on this occasion by Barclays,” Barclays said in its statement.
What Staley did
After being given a copy of the first letter and made aware of the second, Staley asked the bank’s group information security (GIS) team attempt to identify the author or authors of the letters.
“Mr Staley considered that the letters were an unfair personal attack on the senior employee,” the bank said.
Staley was told it was not appropriate to try to identify the author or authors. But in July 2016 he asked if the issue had been cleared. Following this, he had an “honestly held, but mistaken, belief was that he had clearance to identify the author of one of the letters”, the bank said.
The issue puts Barclays’ culture under more scrutiny after a number of scandals at the bank in recent years.
“I am personally very disappointed and apologetic that this situation has occurred, particularly as we strive to operate to the highest possible ethical standards,” Barclays chairman John McFarlane said.
A member of the British parliament’s Treasury select committee, Labour Party MP John Mann, said Staley should resign.
EFG Action Group (@EFG_Support) April 10, 2017
Richard Boath, a senior former Barclays investment banker, last year claimed he was fired from the bank for whistle blowing.
Boath said in court he was dismissed as a “direct response” of what he told the Serious Fraud Office during an investigation into the bank over its fundraising from Gulf investors during the financial crisis.
He is suing the bank at a London employment tribunal in a pay dispute and for unfair dismissal due to whistle blowing.
The only mention of ethics in Staley's goals at Barclays was in the context of instilling a “performance ethic.” https://t.co/Pz9NxW54iP— efc Students (@efc_Students) April 10, 2017