Ex Barclays CEO Jes Staley argues financial institution had ‘clear understanding’ of his Epstein ties

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The previous CEO of Barclays Jes Staley will argue the financial institution had a “clear understanding” of the extent of his ties with Jeffrey Epstein when it despatched a letter to regulators describing the connection as “not shut”, in a landmark trial opening on Monday.

Staley is trying to clear his identify and overturn a lifetime ban from senior roles within the monetary providers business imposed by the UK’s Monetary Conduct Authority in 2023. He stepped down as chief government of Barclays in 2021 following an FCA investigation of the way in which he described his relationship with the disgraced financier and intercourse offender Epstein. Staley didn’t draft the letter, however the FCA dominated that he had “recklessly authorized” it.

In his opening assertion, which has been seen by the Monetary Instances, Staley mentioned he had “defined adequate element of his relationship with Mr Epstein, in conversations with senior executives and board administrators at Barclays . . . to supply them with a transparent understanding that he has an in depth skilled relationship with Mr Epstein, extending over a few years”.

“This was additionally one of many components which brought about Barclays to retain confidence in Mr Staley after [the FCA] opened and continued its investigation.” The FCA started its probe in 2019.

Staley is looking for to disprove allegations made by the FCA in its opening arguments that he had displayed a “sample of conduct” in repeatedly misrepresenting his relationship with Epstein to keep away from damaging his profession.

The ex-Barclays boss “was conscious of the danger which his affiliation with Mr Epstein posed to his repute and his profession”, the watchdog mentioned in its arguments, which have been seen by the FT, including that this was why he sought to “minimise the closeness and period of his relationship”.

The FCA mentioned Staley “should have been conscious” of the danger {that a} letter from Barclays to the watchdog in October 2019 can be deceptive: this acknowledged that Staley had confirmed “he didn’t have an in depth relationship” with Epstein, and that they final communicated “properly earlier than he joined Barclays in 2015”.

The FCA had been despatched a cache of emails from Staley’s former employer JPMorgan Chase that the regulator believed confirmed in any other case. This prompted it to launch the investigation that finally led to Staley being fined £1.8mn and given a lifetime ban. 

“He was reckless as to that danger in permitting the deceptive statements to be made to the authority, in circumstances the place he was the one particular person at Barclays who truly knew the closeness of his relationship to Mr Epstein and the recency of his contact with him,” the FCA mentioned in its opening arguments.

Staley has sought to border his relationship with Epstein, who died in 2019 whereas awaiting trial on intercourse trafficking costs, as “one grounded in enterprise” with some situations of social interplay. 

“Mr Epstein had probably the most exceptional community of contacts,” Staley mentioned in his opening assertion. “The vary of his contacts and affect isn’t solely astonishing however might be with out precedent.”

Staley additionally argued that there was a discrepancy between what Barclays needed to convey with the letter — that Staley didn’t find out about or take part in Epstein’s crimes — and the way the FCA interpreted it.

“The letter was not meant, when it was drafted and authorized, to outline the character and historical past of Mr Staley’s relationship with Mr Epstein,” his opening assertion mentioned. “Had that been its objective, it will have been drafted and authorized in very completely different phrases.”

The FCA mentioned it was “not looking for to embarrass” Staley, nor was it “inviting the tribunal to deduce involvement in or information of any misconduct on the a part of Mr Epstein”.

It added that it wanted to have the ability to “rely on the veracity and completeness of the representations made to it and openness in disclosing issues of which it will moderately anticipate to be given discover”. 

“This is a crucial case . . . in regards to the conduct required of people who maintain senior roles within the sector and who set an instance to workers at their agency,” it mentioned.

The 2-week trial will attract key Metropolis figures, together with Financial institution of England governor Andrew Bailey, in addition to Staley’s former colleagues at Barclays, which has lengthy sought to distance itself from the episode.