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Barclays investigated over claims it lent Qatar money to invest in itself
Barclays may face an investigation over allegations that it lent Qatar money to invest in itself during the financial crisis, so avoiding a government bail-out.
Barclays admitted last July that four of its current or former managers were being investigated by the FSA over payments linked to Qatar's investment of more than £2bn in June 2008 Photo: PA
By Emma Rowley
6:45AM GMT 01 Feb 2013
57 Comments
The bank’s fundraising efforts in 2008 are already being examined by watchdog the Financial Services Authority (FSA) and the Serious Fraud Office.
However, while it was known that Barclays was under scrutiny, the alleged loan to the Qataris represents a new element of the investigation, according to reports. How much was allegedly loaned, and to what bodies, is unclear.
Institutions can run into problems if such arrangements are not properly revealed to the authorities. Peter Hahn, formerly at investment bank Citi and now at Cass Business School, told the Financial Times: “The concept of lending money to any investor to purchase your own shares raises a series of immediate questions about disclosure and other regulatory issues.”
The controversial capital raising push in 2008, when the crisis was at its worst, had seen Barclays raise billions of pounds from investors in Qatar and Abu Dhabi, meaning that it avoided taking emergency funds from the Government.
However, existing shareholders complained the terms offered to the new investors were too attractive.
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Since then, authorities around the world have been looking into the terms of such deals, which various troubled Western lenders struck with cash-rich Middle Eastern and Asian investors.
Barclays admitted last July that four of its current or former managers were being investigated by the FSA over payments linked to Qatar’s investment of more than £2bn in June 2008.
The latest developments could add to pressure on Barclays, which has already faced a £290m fine for its role in the Libor-rigging scandal.
The bank has appointed City headhunters to find three new non-executive directors, as chairman Sir David Walker looks to refresh the its board following last summer’s upheaval, when both Sir David’s predecessor Marcus Agius and the then chief executive Bob Diamond stepped down.
Qatar represents one of the world’s more active sovereign wealth funds, last year playing a pivotal role in the merger of resource giants Glencore and Xstrata due to its major stake in the latter.
Barclays would not comment on the latest allegations. A spokesman for the bank said: “There is an ongoing investigation and we cannot say anything further.”
The Qataris could not be reached for comment.
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Barclays may face an investigation over allegations that it lent Qatar money to invest in itself during the financial crisis, so avoiding a government bail-out.
Barclays admitted last July that four of its current or former managers were being investigated by the FSA over payments linked to Qatar's investment of more than £2bn in June 2008 Photo: PA By Emma Rowley
6:45AM GMT 01 Feb 2013
57 Comments The bank’s fundraising efforts in 2008 are already being examined by watchdog the Financial Services Authority (FSA) and the Serious Fraud Office.
However, while it was known that Barclays was under scrutiny, the alleged loan to the Qataris represents a new element of the investigation, according to reports. How much was allegedly loaned, and to what bodies, is unclear.
Institutions can run into problems if such arrangements are not properly revealed to the authorities. Peter Hahn, formerly at investment bank Citi and now at Cass Business School, told the Financial Times: “The concept of lending money to any investor to purchase your own shares raises a series of immediate questions about disclosure and other regulatory issues.”
The controversial capital raising push in 2008, when the crisis was at its worst, had seen Barclays raise billions of pounds from investors in Qatar and Abu Dhabi, meaning that it avoided taking emergency funds from the Government.
However, existing shareholders complained the terms offered to the new investors were too attractive.
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Since then, authorities around the world have been looking into the terms of such deals, which various troubled Western lenders struck with cash-rich Middle Eastern and Asian investors.
Barclays admitted last July that four of its current or former managers were being investigated by the FSA over payments linked to Qatar’s investment of more than £2bn in June 2008.
The latest developments could add to pressure on Barclays, which has already faced a £290m fine for its role in the Libor-rigging scandal.
The bank has appointed City headhunters to find three new non-executive directors, as chairman Sir David Walker looks to refresh the its board following last summer’s upheaval, when both Sir David’s predecessor Marcus Agius and the then chief executive Bob Diamond stepped down.
Qatar represents one of the world’s more active sovereign wealth funds, last year playing a pivotal role in the merger of resource giants Glencore and Xstrata due to its major stake in the latter.
Barclays would not comment on the latest allegations. A spokesman for the bank said: “There is an ongoing investigation and we cannot say anything further.”
The Qataris could not be reached for comment.
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Banks and Finance
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Win £10,000 in youth unemployment essay prize
Top 10 coolest offices in the UK
In Banks and Finance
Goldman staff to get average £250,000 payout
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City jobs numbers hit eight-year low
Switzerland's oldest bank pleads guilty over tax evasion
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Beth Williams
26 seconds ago
WHY HAS NOBODY FROM BARCLAYS BEEN PROSECUTED?
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devondickie
2 minutes ago
A kid caught up in the riots helps himself to a bottle of water out of a smashed shop window to quench his thirst as buidlings and cars around him burn. He is arrested and sent to prison for six months for looting.
A major bank engages in a massive international criminal fraud, it misleads the regulators over its solvency, misells products to huge numbers of customers, whilst paying its managers vast bonsues and salaries.
Not one of the bank's staff is in jail.
We live in a mafia state where the bankers do as they will, protected by their bought politicians in the Tory Party who are bankrolled by the City, which has received £1.5 Tn in public money to bail them out after they lost their shirts through sheer greed - socialism for bankers, whilst the rest of us have our incomes hammered to pay for it.
This is the stufff of revolutions.