How Epstein sealed Staley’s ‘inevitable’ downfall

Jes Staley conceded that it will have been simpler to not have been associates with convicted paedophile Jeffrey Epstein. At no different time was that sentiment, expressed in the course of the former Barclays boss’s cross-examination in a London courtroom in March, extra true than on Thursday. The 68-year-old American discovered that he had failed in his bid to overturn a lifetime ban imposed on him by the UK’s Monetary Conduct Authority over his ties to Epstein, the useless financier and prolific intercourse offender. “The lack of his long-standing profession is an inevitable consequence”, learn the judgment of the Higher Tribunal, which heard Staley’s attraction towards the FCA.Staley’s attraction was a last-ditch try by the banker to clear his identify and salvage a four-decade profession spent largely at JPMorgan Chase and Barclays, two of the world’s most vital monetary establishments. As a substitute, the month-long trial introduced some uncomfortable truths to gentle for Staley, a few of them excruciatingly private. This was virtually inevitable for a case that featured 1000’s of emails between the banker and his paedophile consumer, together with a cryptic reference to fairytale characters comparable to “Snow White” paying a go to.Because it was, Staley in court docket admitted to extramarital intercourse with an Epstein worker, and the tribunal heard how — in April 2009 as Epstein was serving a sentence for soliciting a minor — Staley forwarded an electronic mail from him to Staley’s scholar daughter, referring to him as “Uncle Jeffrey”.Ex-Barclays boss Jes Staley, pictured right here outdoors court docket along with his lawyer Kathleen Harris, submitted to intensive cross-examination © Chris Ratcliffe/BloombergIf Staley hoped to distance himself from Epstein’s lengthy shadow, the trial had the alternative impact.“I don’t know why Staley fought this,” stated one banker. “Now each time a sentence is written about him, Epstein may even get a point out.”As if this week couldn’t get any worse for Staley, he and Barclays now face the prospect of a US class motion after a decide dominated this week {that a} lawsuit from pension funds can proceed. They allege that they had been misled over Staley’s relationship with Epstein. Barclays didn’t instantly reply to a request searching for remark.It might result in but yet another courtroom through which Staley is required to recount his relationship with the useless intercourse offender.In London, the courtrooms within the Rolls Constructing have performed host to numerous multimillion industrial disputes. However few different circumstances could have introduced collectively a member of the British royal household, key figures within the UK political institution, two of probably the most systemically vital establishments and probably the most infamous sexual predator in current reminiscence; a testomony to Epstein’s connections and affect in excessive society each within the US and throughout the Atlantic. This was all all the way down to a four-paragraph letter signed by Barclays chair Nigel Higgins and despatched to the FCA in October 2019, two months after Epstein’s dying in a New York jail cell awaiting trial on intercourse trafficking costs. The letter acknowledged that Staley “didn’t have a detailed relationship” with Epstein and that his final contact with him was “nicely earlier than he joined Barclays in 2015.” That would have been the top of it. However shortly after, the FCA obtained phrase from Staley’s former employer JPMorgan — the place Staley had nurtured Epstein as a consumer — that it was in possession of a trove of emails exchanged between the 2 males. The UK regulator requested the financial institution handy over the proof and, after a four-year investigation, banned Staley from holding senior positions in monetary companies and fined him £1.8mn. Staley’s attraction towards the FCA, heard at London’s Rolls Constructing, was all the time going to be high-profile © Charlie Bibby/FTThe tribunal concluded on Thursday that the FCA was appropriate to search out that Staley had recklessly misled it. It was the primary time the regulator had banned a financial institution CEO for actions taken on his watch. His behaviour represented a “severe failure of judgment” and he had “acted with out integrity”, the tribunal concluded. Nonetheless, it ordered Staley’s high-quality diminished by virtually 40 per cent to £1.1mn to replicate the truth that Barclays had not allowed Staley to obtain deferred shares that he was entitled to. Decide Timothy Herrington, the presiding decide, delivered a scathing indictment of Staley’s proof, a few of which “lacked credibility,” and highlighted a number of cases through which the banker’s witness statements contradicted what he then stated on the stand, not least across the nature of his relationship with Epstein.  Decide Herrington accepted that Staley and Epstein’s relationship had began out as knowledgeable one however stated they’d develop into “each professionally and personally shut.” He was additionally not satisfied that communication between the 2 males had stopped earlier than Staley turned Barclays CEO and accepted the FCA’s argument that they’d communicated by means of Alexa Staley, the banker’s daughter. “If Mr Staley had been requested in 2017 whether or not he had been involved with Mr Epstein, the suitable reply to that query would have been “circuitously however I did reply to some enquiries he made with me through my daughter,” wrote Decide Herrington. Barclays’ chair Nigel Higgins, who signed the 2019 letter to the FCA, gave proof on the trial. © Jaimi Pleasure/BloombergFCA officers privately expressed reduction to lastly get a beneficial ruling from Decide Herrington, who’s retiring after years of harshly criticising the watchdog, most not too long ago when the tribunal overturned its ban of three Julius Baer executives in 2023.One former senior FCA official known as the decision “a stable outcome” however added that “it stays baffling why Staley introduced this case which has broken his popularity and should have left him out of pocket regardless of the discount within the monetary penalty.”Though Staley has two weeks to resolve whether or not to attraction, FCA director Therese Chambers might barely disguise the company’s triumphant temper in her official response to the ruling. She stated the previous Barclays boss had proven “a severe lack of integrity” and had “hoped that the reality would by no means come to gentle and that he would get away with it”.For his half, Staley stated in an announcement that he was “disillusioned by the result and the time it took for this course of to play out.”He added: “I’ve labored tirelessly for my prior employers for the whole thing of my profession; I’m pleased with the assist I gave to many people throughout that profession and the technique I developed to assist Barclays when it confronted immense challenges. The Tribunal recognised what they described as ‘my lengthy and distinguished profession’.” Attorneys stated the decision had been anticipated. Some expressed disbelief that Staley ever thought he might win, given the inherent weak point of his case when the financial institution’s letter that he authorized had clearly misled the regulator about how shut his friendship was with Epstein.“I don’t suppose the Higher Tribunal had any choice however to deal with this as performing recklessly and never being sufficiently open with the FCA,” stated one Metropolis lawyer. One particular person might have felt extra sympathy for Staley than most. Crispin Odey, the hedge fund billionaire, is making ready to mount an analogous authorized problem towards the UK monetary watchdog. RecommendedThe FCA banned Odey in March and fined him £1.8mn for a “lack of integrity” in his conduct following allegations of sexual harassment and assault, all of which the hedge fund founder has denied. The watchdog’s motion was not primarily based on the sexual misconduct accusations towards Odey themselves, however on his alleged makes an attempt to frustrate his hedge fund’s efforts to deal with complaints about his behaviour and produce disciplinary proceedings towards him.Odey, who’s suing the Monetary Occasions for libel for its reporting of sexual misconduct allegations plenty of girls made towards him, appears to have adopted Staley’s case as he prepares to defend himself towards the FCA, whose choice is provisional. The financier made an surprising go to to the court docket for a dialogue with Staley’s lawyer because the listening to drew to a detailed in early April.“Wanting forward, it’s fascinating to consider Crispin Odey’s attraction,” stated a former senior FCA official who was on the regulator when it investigated Staley. It appears unlikely the American banker, who relies within the Hamptons, will make a reciprocal courtroom go to if the time comes.