The Barclays boss and the whistleblower

London Briefing: Punishment needed if Threadneedle Street codes to be enforced


Is Jes Staley a kind, caring boss who went the extra mile to protect a colleague from unwarranted smears? Or is he an arrogant ex-Wall Street banker who just decided the rules didn’t apply to him?

Protection for whistleblowers has been enshrined in British law for almost two decades, yet the Barclays boss saw fit to unleash the hounds in his attempt to unmask the author of letters containing allegations of a personal nature about a recently recruited senior banker.

The banker, Tim Pain, had been a long-standing colleague of Staley’s at his former employer, JPMorgan. Staley tasked Barclays’ internal security team with discovering the identity of the whistleblower and, even after being told to desist, drafted in a US law enforcement agency to aid the pursuit.

Staley admits now he got too personally involved, while the Barclays board describes his actions as “an honest mistake”.

Coincidentally, that’s the same phrase Bank of England governor Mark Carney used last month to describe the actions of his former deputy, Charlotte Hogg, who failed to declare a conflict of interest with her brother, Quintin.

There are distinct parallels between the Staley scandal and the Bank of England affair. Staley is one of the big beasts in the banking world while Hogg, widely tipped as a future governor of the Bank of England, was one of the most powerful women in the City.

Code of conduct

But she broke Threadneedle Street’s code of conduct – one she helped to write – when she failed to declare her brother is a senior executive at a major UK bank (Barclays, funnily enough).

She was given a formal warning and her salary was frozen but, after a damning report from MPs, Hogg tendered her resignation and will leave the bank later this year.

The governor made it quite clear at the time that he did not regard her offence as egregious and, in his view, it was certainly not a resigning matter. Likewise at Barclays, the board remains “unanimous” in its support of its chief executive.

As Staley is not a stupid man, the “honest mistake” defence stretches credulity. It’s hard to escape the conclusion that he simply believed the rules did not apply to him or, if they did, he was more than willing to break them.

The Barclays board may believe that docking the multimillionaire banker’s bonus is punishment enough, but will the City regulators go along with that?

They are now investigating both the bank and its chief executive and have the power to fine the former and ban the latter from the financial services industry, in which case he would be forced to quit.

The action they take will show how serious the City is in cleaning up its act and promoting a more honest culture. If others are to be encouraged to come forward when they see wrongdoing, the authorities have only one course of action. And that’s to throw the book at the Barclays boss.


Tesco has come a long way in the two years since it reported one of the biggest losses in British corporate history, plunging into the red by £6.4 billion (€7.5 billion).

On Wednesday, chief executive Dave Lewis, who took over in the wake of the 2014 accounting scandal, is expected to report that profits have bounced back comfortably above £1 billion.

While Tesco has now put the false accounting crisis behind it – the High Court approved its £129 million settlement with the Serious Fraud Office on Monday – Lewis is likely to be given something of a rough ride in the City today despite the impressive recovery in profits.

At issue is the group’s ambitious £3.7 billion takeover of the cash and carry company Booker. Shareholders are concerned the ambitious deal will derail the recovery, eating up management time and energy that should be spent securing the performance of the core UK supermarkets chain.

‘Destruction of value’

Investors are also worried about the high price being paid by Tesco – a heady 23 times Booker’s earnings. Such terms are highly likely to result in “the destruction of value” for Tesco, according Nick Kirrage of Schroders, its third-largest shareholder.

The Booker deal has already resulted in the loss of one key member of the Tesco board – senior independent director Richard Cousins quit in protest at the proposed move at the start of the year.

Analysts and investors will today be looking to Lewis to provide reassurance on the strength of the group’s recovery and the merits of the Booker deal.

Fiona Walsh is business editor of

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