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Barclays may be fined over Qatari deals

by LLB Editor
16th Sep 13 10:53 am

Barclays may have to pay a big financial penalty over the £11.8bn capital it raised from Qatari and other sovereign investors, which helped it avoid a government bailout.

According to Sky News, the bank is negotiating a settlement with the Financial Conduct Authority (FCA) on whether Barclays should have disclosed more information to the stock market about the 2008 deal.

Barclays is trying to get enforcement action as soon as possible as it expects to publish a preliminary prospectus for its £5.8bn rights issue today.

Investment banks, who are underwriters of the issue, are reportedly calling for a “clear sight” of Barclays’ financial penalty.

The bank’s Qatari deals are also being investigated by the Serious Fraud Office and authorities in the US. However, Barclays didn’t spell out the details of the investigation in its half-year results statement during the summer.

“The FCA and the Serious Fraud Office are both investigating certain commercial agreements between Barclays and Qatari interests and whether these may have related to Barclays’ capital-raisings in June and November 2008.

“The FCA investigation involves four current and former senior employees, including Chris Lucas, [former] group finance director, as well as Barclays.

“The FCA enforcement investigation began in July 2012 and the SFO commenced its investigation in August 2012.

“The FCA provided its preliminary findings against Barclays on 27 June 2013 in respect of some of these commercial agreements. Barclays has responded on 25 July 2013 contesting the FCA’s preliminary findings.

“Barclays expects further developments in the near term.”

Last year, Barclays got a £291m fine for its role in manipulating Libor. The bank has also set aside billions of pounds to compensate for payment protection insurance and interest rate swap mis-selling.

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