Barclays boss Jes Staley has quit after the bank’s board said it was ‘disappointed’ with the outcome of a report into his links to convicted sex offender Jeffrey Epstein.
The bank said it was made aware last Friday evening of the preliminary conclusions from the Financial Conduct Authority’s investigation, but did not go into details.
The American banker intends to contest the findings. Meanwhile, the bank pointed out that the probe makes no findings that he saw, or was aware of, any of Epstein’s alleged crimes.
It is understood the early draft of the report suggests the father-of-two, who grew up near the east coast city of Philadelphia, played down his role in Epstein’s affairs while acting as his private banker in a previous job.
He had denied reports as recently as last month that he could leave by the end of 2021 – telling the Evening Standard that he would be staying for another two years.
The Barclays share price fell by around 3 per cent on the news in early trading this morning, although a weaker pound helped lift the exporter-heavy FTSE 100 index.
Barclays said last year that UK financial regulators were probing links between Mr Staley and Epstein, who killed himself while awaiting trial on sex trafficking offences.
Jes Staley and his wife Debbie Staley are pictured together in New York in March 2017
Mr Staley has previously said his relationship with Epstein – who was also friends with Prince Andrew – ended in late 2015, and that he regretted his relationship with him.
The 64-year-old, who is married to interior designer Debbie, was replaced today by the bank’s head of global markets CS Venkatakrishnan, known as ‘Venkat’.
Mr Staley is a keen sailor who owns a hand-built 90ft yacht, Bequia, named after the Caribbean island where he spent his honeymoon with his wife.
Barclays said Mr Staley was entitled to 12 months’ notice and will therefore continue to receive his current fixed annual pay of £2.4million in cash and Barclays shares, a pension allowance of £120,000 and other benefits until October 31, 2022.
Mr Staley is married to interior designer Debbie (above, together in New York in October 2013)
Speaking in February last year, Mr Staley said: ‘For sure, with hindsight with what we know now, I deeply regret having any relationship with Jeffrey.’
He had embarked on a ‘professional relationship’ with Epstein in 2000, when Mr Staley became head of JPMorgan’s private bank, of which Epstein was a client.
Venkat had been global markets chief and bank co-president since October 2020, and prior to that was group chief risk officer from 2016 to 2020.
Before joining Barclays in 2016, Venkat worked at JP Morgan Chase from 1994 in various senior roles across asset management, investment banking and risk.
Jes Staley (left) at Jeffrey Epstein’s mansion in New York in 2011. Pictured (from left): Mr Staley; former Treasury Secretary Lawrence Summers; Epstein; Bill Gates, Microsoft’s co-founder; and Boris Nikolic, who was the Bill and Melinda Gates Foundation’s science adviser
In his new role, Venkat will receive fixed annual pay of £2.7million – delivered 50 per cent in cash, paid monthly, and 50 per cent delivered in Barclays shares.
The shares will be delivered quarterly and will be subject to a holding period with restrictions lifting over five years.
Venkat will also receive a cash payment in lieu of pension of £135,000 per annum, along with medical cover and life assurance.
A Barclays spokesman said today: ‘Barclays and Mr Jes Staley, group chief executive, were made aware on Friday evening of the preliminary conclusions from the FCA and the PRA (Prudential Regulation Authority) of their investigation into Mr 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 the FCA.
‘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.
Staley owns a yacht, Bequia, named after the Caribbean island where he spent his honeymoon
‘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.
‘The board is disappointed at this outcome. Mr Staley has run the Barclays Group successfully since December 2015 with real commitment and skill.
‘Supported by the senior team which he largely helped build and on whom the Barclays Group will be relying for the future, Mr Staley clarified the Barclays Group’s strategy, transformed its operations and materially improved its results.’
A wealthy financier, Epstein was found dead in a New York prison in August 2019 while awaiting trial on allegations that he trafficked girls as young as 14 for sex.
Mr Staley was replaced by head of global markets CS Venkatakrishnan, known as ‘Venkat’
Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said today: ‘The repercussions from the Jeffrey Epstein scandal stretch far and wide, and now Barclays finds itself at the centre of the storm.
‘For the chief executive, Jes Staley to step down following an investigation by city regulators into his into his dealings with Epstein, it’s clear the conclusions of the probe are critical.
‘While the probe did not centre on Mr Staley’s role at Barclays but what he disclosed about his previous position at JP Morgan, what was under question was how he characterised his former relationship with the disgraced financier.
She added: ‘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 3 per cent in early trading.
‘However, continuity will be provided to some extent by CS Venkatakrishnan, head of global markets, who will take over as chief executive.’