Barclays CEO Staley quits over Epstein links
British bank Barclays on Monday said chief executive Jes Staley had quit ahead of contesting the outcome of a UK probe into his historical links with convicted sex offender Jeffrey Epstein.
Barclays, which had supported Staley during the ongoing investigation, added in a statement that the preliminary conclusion “makes no findings that Mr Staley saw, or was aware of, any of Mr Epstein’s alleged crimes”.
Staley last year expressed “deep regret” at having a professional relationship with Epstein prior to becoming Barclays head at the end of 2015.
Epstein’s past has caused huge fallout elsewhere, with Queen Elizabeth II’s second son, Prince Andrew, recently sued in a New York court for alleged sexual abuse of a woman who says she was “lent out” for underage sex by the late US financier.
Microsoft co-founder Bill Gates in August said it was a “huge mistake” to socialise with Epstein, who killed himself in 2019 while awaiting trial on charges of sex trafficking minors.
Barclays revealed that Staley and the bank were made aware late Friday of the preliminary conclusions from an investigation carried out by British financial watchdogs.
“In view of those conclusions, and Mr Staley’s intention to contest them, the board and Mr Staley have agreed that he will step down from his role as group chief executive and as a director of Barclays,” the bank said.
“It should be noted that the investigation makes no findings that Mr Staley saw, or was aware of, any of Mr Epstein’s alleged crimes, which was the central question underpinning Barclays’ support for Mr Staley following the arrest of Mr Epstein in the summer of 2019,” it added.
The probe has looked into “Staley’s characterisation to Barclays of his relationship with the late Mr Jeffrey Epstein and the subsequent description of that relationship in Barclays’ response” to investigators.
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, noted that “although detail is limited, it appears regulators believe there was a distinct lack of transparency over this relationship”.
Barclays said it was “disappointed” by the outcome, adding that “Staley has run the Barclays group successfully since December 2015 with real commitment and skill”.
The bank said that Staley has been replaced with immediate effect by its head of global markets, C.S. Venkatakrishnan.
“Sudden change at the top is always unsettling, and the departure of Mr Staley who propelled its successful investment banking expansion strategy may be particularly unnerving for investors, with shares falling three percent in early trading,” said Streeter.
“However, continuity will be provided to some extent by C.S. Venkatakrishnan.”
Barclays added that Staley was entitled to 12 months severance pay during which he will continue to receive his annual cash and shares salary of £2.4 million ($3.3 million, 2.8 million euros) plus pension and other benefits.
He is also entitled to repatriation costs to his home country the United States.
In a brief statement, Britain’s Financial Conduct Authority, whose probe is being carried out along with the Bank of England’s Prudential Regulation Authority, said the pair “do not comment on ongoing investigations or regulatory proceedings”.
Staley has previously said his last contact with Epstein was in 2015.
This was ahead of Staley becoming Barclays CEO in December of that year and seven years after Epstein had been convicted for sex offences.
“For sure, with hindsight with what we know now, I deeply regret having any relationship with Jeffrey,” Staley said last year, having embarked on a “professional relationship” with Epstein in 2000.
This was when Staley became head of JPMorgan’s private bank, of which Epstein was a client.
Prince Andrew last week insisted his sexual assault accuser was out to profit from a “baseless lawsuit” against him as he asked a New York court to dismiss the case.
In a filing in Manhattan, the Duke of York’s lawyers accused Virginia Giuffre of suing the prince “to achieve another payday” from her accusations against Epstein.
The 38-year-old sued Andrew for unspecified damages in August, claiming he sexually assaulted her more than 20 years ago when she was 17 and a minor under US state law.