Barclays chief to keep job despite move to unmask whistleblower
Jes Staley facing fine following investigation by UK regulators
Barclays’ board plans to recommend the re-election of chief executive Jes Staley at the annual general meeting on May 1st, the company said in the statement. Photograph: Peter Nicholls/Reuters
While the Financial Conduct Authority and Prudential Regulation Authority proposed that Mr Staley pay a financial penalty, they “are not alleging that he acted with a lack of integrity or that he lacks fitness and propriety to continue to perform his role as group chief executive officer,” the bank said in a statement on Friday.
Barclays’ board plans to recommend his re-election at the annual general meeting on May 1st, the company said in the statement.
The lender reprimanded its chief executive in April last year after discovering he’d twice tried to identify a whistleblower. Mr Staley has also come under increasing pressure in his third year in charge of the British lender.
In March, activist investor Edward Bramson bought a stake in Barclays with the aim of pushing for strategic change to lift the shares, adding to growing discontent among investors about the lack of progress in turning around the investment bank.
Mr Staley, a former JPMorgan Chase executive, bet his reputation on boosting returns at the securities unit, which has long been Barclays’s worst-performing division.
The whistleblowing controversy dates back to June 2016, when Barclays’s board received an anonymous letter raising concerns about the recruitment of one of Mr Staley’s former JPMorgan colleagues, Tim Main.
The letters flagged issues of a personal nature about him and Staley’s role in dealing with those concerns at JPMorgan.
After learning about the letters, Mr Staley made two attempts to discover who wrote them, despite being informed that it was inappropriate for him to do so after his first try.
Barclays’s own investigation had found Mr Staley “honestly, but mistakenly, believed” his actions were permitted, which was why they didn’t fire him.
When Mr Staley started in December 2015, he promised he would lead a “cultural transformation” of the lender and reset strained relations with regulators after a series of misconduct fines and settlements wiped out more than £20 billion (€22.8 billion) of earnings over six years.
Regulators have placed whistleblowing, and the protection of those raising the alarm, at the heart of efforts to avoid financial misconduct and scandals since the financial crisis.
The Barclays issue is also seen by commentators as a critical test of the FCA’s senior managers and certification regime, which requires officials to be directly accountable for misconduct on their watch.
As part of the investigation, the FCA interviewed officials including Mike Ashley, the board member who supervises whistleblowing complaints, chief operating officer Paul Compton, former company secretary Lawrence Dickinson and Staley’s chief of staff, Timothy Karpoff. – Bloomberg