LONDON • Barclays and four former top executives have been criminally charged over undisclosed payments to Qatari investors during a £12 billion (S$21.1 billion) emergency fund-raising in 2008.
Britain's Serious Fraud Office (SFO) said yesterday it was charging Barclays with conspiracy to commit fraud and unlawful financial assistance, making it the first bank to face criminal charges over actions taken during the financial crisis.
Barclays said it was considering its position and awaiting further information about the charges, which follow a five-year SFO inquiry into how it avoided the fate of Lloyds and the Royal Bank of Scotland by staving off a state bailout.
The SFO also charged former top Barclays executives John Varley, Roger Jenkins, Thomas Kalaris and Richard Boath after investigating a two-part fund-raising that included a US$3 billion (S$4.16 billion) Barclays loan to the wealthy Gulf state.
A lawyer for Jenkins said he would "vigorously defend" himself against the charges, adding that his client had received both internal and external legal advice at the time.
A spokesman for Boath declined to comment. A lawyer representing Varley declined to comment and a lawyer for Kalaris could not immediately be reached for comment.
The accused are the most senior bankers to be charged in Britain with alleged crimes during the financial crisis and face jail sentences of up to 10 years if found guilty. Barclays, the first bank to be prosecuted since Serious Fraud Office head David Green took over in 2012, could be fined. There was no allegation of wrongdoing against Qatar, which is a major investor in Britain.
The men are the most senior bankers to be charged in Britain with alleged crimes during the financial crisis and face jail sentences of up to 10 years each if found guilty.
Barclays, the first bank to be prosecuted since SFO head David Green took over in 2012, could be fined. There was no allegation of wrongdoing against Qatar, which is a major investor in Britain.
Varley, the bank's former chief executive, Jenkins, a former tax advisory boss, Kalaris, the ex-CEO of Barclays' wealth division and Boath, former European head of financial institutions, have been charged with conspiracy to commit fraud by false representation during a June 2008 capital raising.
Varley and Jenkins have also been charged with conspiracy to commit fraud by false representation in relation to the second capital raising in October 2008, and Varley and Jenkins face another charge of unlawful financial assistance, the SFO said.
The SFO's investigation centred on commercial agreements between Barclays and Qatari investors during two emergency fund-raisings in June and October 2008 at the height of the credit crisis.
Qatar Holding, part of the Qatar Investment Authority sovereign wealth fund, and Challenger, an investment vehicle of former Qatari prime minister Hamad bin Jassim bin Jabr al-Thani, invested around £5.3 billion in Barclays.
The authorities have examined whether payments from Barclays to Qatar at the same time, such as one which was around £322 million in "advisory services agreements", alongside a multi-billion dollar loan, were honest and properly disclosed.
Qatar, meanwhile, has made a healthy profit from its investment and remains Barclays' biggest shareholder, with a stake of around 6 per cent, according to Thomson Reuters data.