Britain's Barclays bank charged with fraud in 2008 dealings

By Ed Adamczyk Contact the Author   |  June 20, 2017 at 7:32 AM
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June 20 (UPI) -- The British government charged bank Barclays PLC and four of its former executives with fraud Tuesday over its capital-raising actions amid the 2008 financial crisis.

The case, brought by Britain's Serious Fraud Office, concerns advisory fees the bank paid to the Qatari Investment Authority and to a $3 billion loan the bank allegedly extended to the Qatari government as it raised $15 billion from Qatari and other investors. The money raised was meant to keep Barclays from seeking a government bailout at a time of global financial crisis. The second and more serious of the charges, "unlawful assistance," accuses the bank and two of its leaders of returning some of the money meant to support the bank to Qatar.

The charges stem from Barclays' arrangements with Qatar Holding LLC, a subsidiary of the emirate's government wealth fund, and Challenger Universal Ltd., in which investments of Qatar's then-prime minister were held.

Barclays said it is "considering its position" in defending itself against the allegations but has not denied them. Government regulators previously fined the company $63.3 million in 2013 after finding it improperly disclosed the arrangements with the Qatari investors. The regulators also investigated if the incorrect disclosures were meant to encourage further investment by the Qataris.

The bank contested the fine, and its payment was postponed while the investigation leading to Tuesday's charges was conducted.

Former Barclays CEO John Varley, former senior investment banker Roger Jenkins, former wealth division chief Thomas Kalaris and former bank head of European operations Richard Boath, were charged with conspiracy to commit fraud in the June 2008 capital raising. Varley and Jenkins were also charged with unlawful assistance.

Varley's lawyer said his client will "vigorously defend against these charges," Bloomberg News reported Tuesday.

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