Barclays is in talks with the UK Serious Fraud Office (SFO) over a possible deal to avoid new charges against one of its main operating units linked to a £12 billion (Dh58.96bn) fundraising at the height of the financial crisis, according to a person with knowledge of the situation.
The decision on whether the SFO will charge the unit, Barclays Bank, in relation to the capital raising with Qatar is expected to be made by the end of January, two people with knowledge of the discussions said. The bank’s holding company and four former executives were charged with fraud and unlawful financial assistance in June with a trial scheduled for 2019.
When the charges were announced this year the bank said the SFO had not yet made a decision on whether it would also charge Barclays. Any charges against the operating unit could be problematic because, if convicted, the lender’s ability to do business globally might be affected. Regulatory approvals and banking licences are usually tied to banks’ operating units, through which products and services are provided.
The charges relate to the nature of £322 million in fees Barclays paid to the Qatar Investment Authority and a US$3 billion loan facility it made available to the nation as part of side deals to the fundraising from Qatari and other investors in 2008. The deal allowed Barclays to avoid a state bailout when the industry crashed.
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While a decision on the bank’s flagship operating unit was planned within weeks of the other charges, a person with knowledge of the case said at the time, no additional charges have been filed.
Spokesmen for the SFO and the bank declined to comment. The bank said in June it was "considering its position" in relation to the charges, while the executives indicated in July they would plead not guilty.
The SFO opened an investigation into the Qatar deal in 2012. About a dozen senior executives were interviewed across the five-year-probe, including former chief executive Bob Diamond. The deal involved Qatar Holding, a subsidiary of the country’s QIA sovereign wealth fund, and Challenger Universal, an investment vehicle of Qatar’s then prime minister.
The fundraising is also being reviewed by the Financial Conduct Authority, which re-opened its probe earlier this year after additional documents came to light. The regulator had previously fined the bank £50m in relation to how it disclosed the fees to the Qataris. The bank said previously it is challenging the fine, which has been stayed until after the criminal proceedings are resolved.
