In the UK, the Serious Fraud Office is charging Barclays Bank (BARC) with engaging in illegal financial assistance when it gave Qatar Holdings LLC a $3B loan in 2008 so that the latter could acquire shares in Barclays Plc. British prosecutors had previously charged Barclays Plc. and four bank executives with conspiring to commit fraud and providing unlawful financial assistance.
In Britain, public companies are usually not allowed to lend out funds to be used to buy their own shares. Barclays has come under fire for the way it handled investments made by Qatar’s sovereign wealth fund, as well as by a group of investors. The money lent to Barclays is believed to have helped the British Bank avoid getting a tax bailout during the global financial crisis. Such assistance would have likely lead to greater oversight over Barclays and closer examination of how much the bank’s executives were making at the time.
Barclays denies the charges against Barclays Plc. and Barclays Bank, which is its operating arm. Prosecutors, however, believe that the loan funds were put back into the bank to give it the capital it needed.
With the criminal case brought against Barclays last June, British authorities accused the firm of misrepresenting arrangements made with Qatar as the bank was about to secure $15B from the sovereign wealth fund and other investors in two deals. Aside from the $3B loan facility, the SFO examined a deal that involved Qatar paying over £300 million for advisory services. The four individuals charged with conspiracy to commit fraud by engaging in false representations involving financing included:
- Ex- Barclays CEO John Varley
- Ex- Barclays Capital Investment Banking and Investment Management for the Middle East Chief Roger Jenkins
- Former Barclays Wealth and Investment Management CEO Thomas Kalaris
- Former Barclays’ Financial Institutions Group European head Richard Boath
Securities Fraud Lawyers
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Barclays Hit by New Charge Over 2008 Fundraising, The Wall Street Journal, February 12, 2018
Further SFO charges in Barclays Qatar capital raising case, Serious Fraud Office, February 12, 2017
SFO charges in Barclays Qatar capital raising case, Serious Fraud Office, June 20, 2017
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