Ex-Barclays CEO Staley loses appeal against UK ban over Epstein ties

LONDON (Reuters) -Former Barclays boss Jes Staley on Thursday lost his high-stakes appeal against a proposed financial industry ban for misleading Britain’s Financial Conduct Authority over his relationship with Jeffrey Epstein.

Thursday’s decision by the Upper Tribunal spells the likely end of Staley’s risky attempt to publicly clear his name, which simply once again shone a spotlight on his association with the late disgraced financier.

Staley, who gave evidence he had no idea about Epstein’s “monstrous activities” and said he could not remember embarrassing emails between the pair, said he was disappointed with the decision.

The FCA in 2023 said it would ban Staley and fine him 1.8 million pounds ($2.4 million) for misleading the watchdog over his ties to Epstein, a decision which the former Barclays chief executive decided to fight.

The 68-year-old’s case centred on a 2019 letter sent by Barclays Chair Nigel Higgins to the FCA, which approached the British bank after Epstein’s arrest on sex-trafficking charges brought scrutiny on Staley and other high-profile associates.

The FCA said the letter contained two misleading statements: that Staley “did not have a close relationship” with Epstein and their last contact was “well before he joined Barclays in 2015”.

Staley said both statements were accurate and that he did not have the same relationship with Epstein after he left JPMorgan, where Epstein was once a major client.

APPEAL BACKFIRES

Judge Timothy Herrington said, however, that both statements were inaccurate, ruling that “the evidence that Mr Staley had a close relationship with Mr Epstein is overwhelming”.

The judge also said that Higgins’ letter to the FCA reflected what Staley had told senior Barclays staff about his relationship with Epstein.

Staley’s fine, though, was reduced to 1.1 million pounds to take account of Barclays suspending the vesting of deferred shares after Staley left the bank. Barclays did not immediately comment.

His dispute with financial regulators over the case had prompted his shock resignation in November 2021 and a reshuffle of Barclays’ leadership in what became a tumultuous period for the lender.

The decision to appeal has backfired for Staley, whose evidence featured his admission he had sex with a member of Epstein’s staff in Epstein’s brother’s apartment.

The appeal also revived scrutiny of previously-reported emails between Staley and Epstein, in which Staley described their friendship as “profound”.

In one email chain from 2010, Staley told Epstein: “That was fun. Say hi to Snow White.” When Epstein asked “what character would you like next”, Staley replied: “Beauty and the Beast.”

Staley said he had no recollection of those emails, when asked about them by the FCA’s lawyers. 

Herrington ruled that the emails pointed towards Staley and Epstein having a “close personal relationship” and that Staley’s answers were “either evasive or defensive”.

Therese Chambers, joint executive director of enforcement and market oversight at the FCA, said Staley “chose to take a calculated risk that we would take his inaccurate account of his relationship with Mr Epstein at face value”.

“Such a serious lack of integrity  flies in the face of the requirements we place on those at the top,” Chambers added.

(Reporting by Sam Tobin and Lawrence White; Editing by Tomasz Janowski)