Barclays has announced Chief Executive Jes Staley is being investigated by two U.K. regulators regarding his individual conduct after he attempted to identify a whistleblower at the bank in 2016.
The Financial Conduct Authority (FCA) and the Prudential Conduct Authority (PRA) have opened an investigation into both Staley and Barclays’s actions when pursuing the author of a letter believed to have originated from a whistleblower.
“I have apologized to the Barclays Board, and accepted its conclusion that my personal actions in this matter were errors on my part. I will also accept whatever sanction it deems appropriate,” Staley said in a statement.
“Our whistleblowing process is one of the most important means by which we protect our culture and values at Barclays and I certainly want to ensure that all colleagues, and others who may utilize it, understand the criticality which I attach to it,” he added.
The Barclays Board found Staley had “honestly, but mistakenly” sought the identity of the letter’s author without appropriate governance. The whistleblower was not identified by the Barclays boss and the board has now accepted his apology.
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Staley is due to receive a written warning from the banks’ board and can expect a “very significant” reduction to his variable compensation award. However, Staley is set to be reappointed at the bank’s upcoming annual general meeting next month.
Barclays shares were slightly lower shortly after Monday’s open, down 0.5 percent.
‘Concerns of a personal nature’
In June 2016, members of the board and a senior executive working at the bank both received separate anonymous letters concerning a senior employee who had been recruited by Barclays earlier in the year.
Amongst other issues, the letters “raised concerns of a personal nature” against the recently hired senior employee. Having been given a copy of the first letter from members of the board and made aware of a second letter, Staley requested the Group Information Security (GIS) team attempt to identify the author of the letters.
Staley considered the letters to have been an unfair personal attack on the senior employee although was subsequently informed it was not appropriate to take any further action.
In July 2016, Staley followed up an enquiry made in June as to whether Barclays’ compliance team had concluded its whistle-blow investigation. The bank’s CEO then incorrectly believed he had been given clearance to request the GIS team to pursue the identity of the author of the letter the board members had initially received.
Ultimately, the GIS team was unsuccessful in identifying the whistleblower and no further steps were taken after this stage.
Barclays to support Staley reappointment
“I am personally very disappointed and apologetic that this situation has occurred, particularly as we strive to operate to the highest possible ethical standards,” John McFarlane, Barclays chairman, said in a statement.
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“Taking into account both the circumstances of this matter and his otherwise exemplary record since joining Barclays, including contributing significantly to improvements in Barclays culture and controls, Jes continues to have the Board’s unanimous confidence and it will support his re-appointment at Barclays Annual General Meeting on May 10, 2017,” McFarlane added.
Barclays and Staley have said they would cooperate fully with the FCA and PRA investigations.