"We consider that he misled both the FCA and the Barclays Board about the nature of his relationship with Mr Epstein."
The FCA has fined former CEO of Barclays, James Staley, £1.8 million and banned him from working in a senior position over a 'reckless' letter which contained misleading statements about his relationship with Jeffrey Epstein.
The FCA found that Staley "recklessly approved a letter" sent by Barclays to the FCA, which contained two misleading statements about the nature of his relationship with Jeffrey Epstein and the point of their last contact.
In August 2019, the FCA asked Barclays to explain what it had done to satisfy itself that there was no impropriety in the relationship between Staley and Epstein. In its response, Barclays relied on information supplied by Staley, who confirmed the letter was fair and accurate.
The letter claimed that Staley did not have a close relationship with Epstein. In reality, in emails between the two Staley described Epstein as one of his 'deepest' and 'most cherished' friends.
The letter from Barclays to the FCA also claimed Staley ceased contact with Epstein well before he joined Barclays. However, Staley was in fact in contact with Epstein in the days leading up to his appointment as CEO being announced on 28th October 2015.
While Staley did not draft the letter, the FCA says there was "no excuse" for his failure to correct the misleading statements when he was the only person at Barclays who knew the full extent of his personal relationship with Epstein and the specific timings of his contact with him. The FCA has found that Staley was aware of the risk that his association with Epstein posed to his career.
The FCA considers that, in failing to correct the misleading statements in the letter, Staley "recklessly misled the FCA and acted with a lack of integrity".
As a result, he has been banned from holding a senior management or significant influence function in the financial services industry.
Staley has referred his Decision Notice to the Upper Tribunal where he will present his case, and any findings in the Decision Notice are therefore provisional.
Therese Chambers, joint executive director of enforcement and market oversight at the FCA, said: "A CEO needs to exercise sound judgement and set an example to staff at their firm. Mr Staley failed to do this. We consider that he misled both the FCA and the Barclays Board about the nature of his relationship with Mr Epstein.
"Mr Staley is an experienced industry professional and held a prominent position within financial services. It is right to prevent him from holding a senior position in the financial services industry if we cannot rely on him to act with integrity by disclosing uncomfortable truths about his close personal relationship with Mr Epstein."