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FCA and PRA launch whistleblowing probe into Barclays boss Staley

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FCA and PRA launch whistleblowing probe into Barclays boss Staley

Regulators have launched in investigation into the conduct of Barclays chief Jes Staley after he tried to identify a whistleblower. 

The probe by the Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) relates to action by Staley in 2016 to identify the author of a letter highlighting an undisclosed issue in the bank.

At 9.05am shares in Barclays were down 0.3% at 214.7p as the market digested the news. 

According to a stock exchange announcement, the attempt by Staley to identify the author of the letter first came to the attention of the Barclays board in early 2017, as a result of a concern raised by an employee regarding, among other matters, the adequacy of Barclays' whistleblowing procedures.

The board immediately instructed an external law firm, Simmons & Simmons, to conduct a investigation into the matter, led by Sir Gerry Grimstone, deputy chair and senior independent director, on behalf of the board.

The board also promptly notified the FCA and PRA and other relevant authorities.

The investigation by Simmons & Simmons concluded Staley acted honestly, but mistakenly, believed that it was permissible to identify the author of the letter. 

'I have apologised to the Barclays board, and accepted its conclusion that my personal actions in this matter were errors on my part. I will also accept whatever sanction it deems appropriate,' Staley said in a statement. 

'I will cooperate fully with the Financial Conduct Authority and the Prudential Regulatory Authority, which are now both examining this matter.

He added: 'Our whistleblowing process is one of the most important means by which we protect our culture and values at Barclays and I certainly want to ensure that all colleagues, and others who may utilise it, understand the criticality which I attach to it.'

The board has concluded that Staley made an error in initiating the search, and failing to support the appropriate governance.

The author of the letter was not identified and no further action was taken. However, the incident will hit Staley in the pocket. 

Barclays said it would be issuing a formal written reprimand to Staley and has decided that a very significant compensation adjustment will be made to his variable compensation award.

The board will also give consideration to the findings of the FCA and PRA investigations and the precise amount of the compensation adjustment will be determined by the board once those investigations have concluded.

Barclays said it will cooperate fully with the FCA and PRA investigations.

The bank is also commissioning independent reviews of Barclays relevant processes and controls, including its whistleblowing programme. It continues to review the position of other employees involved in this matter.    

Barclays chair John McFarlane said: 'I am personally very disappointed and apologetic that this situation has occurred, particularly as we strive to operate to the highest possible ethical standards.

'The board takes Barclays culture and the integrity of its controls extremely seriously. We have investigated this matter fully using an external law firm and we will be commissioning an independent review of Barclays processes and controls to determine what improvements may be required.'

 

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