Home World Economy The boss of scandal-plagued Barclays gets into trouble himself

The boss of scandal-plagued Barclays gets into trouble himself

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IN HIS first 17 months running Barclays, Jes Staley seemed scarcely to put a foot wrong. The American has narrowed the British lender’s ambitions, to focus on retail business at home, corporate and investment banking on both sides of the Atlantic, and credit cards. He is pulling Barclays out of Africa, after a century, and has sped up its retreat from other markets. He has also poached several folk from JPMorgan Chase, where he spent 34 years and ran the investment bank.

On April 10th it emerged that Mr Staley had clumsily planted a boot out of bounds. Last June Barclays’ board and an executive received anonymous letters about a “senior employee” hired earlier in 2016. These, say the bank, raised concerns “of a personal nature” about this person and Mr Staley’s role in dealing with the matter “at a previous employer” (presumably JPMorgan Chase).

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Mr Staley, seeing the letters as “an unfair personal attack” on the newcomer, asked Barclays’ security team to find out who had written them, but was told that this should not be done. In July he inquired whether the matter was resolved—and formed the “honestly held, but mistaken” belief that he was now free to identify one of the authors. He set security on the trail again. This time they called in American law-enforcement officials, but failed to unmask the writer.

Both boss and bank are up before the beak: regulators are examining Mr Staley’s conduct and Barclays’ treatment of whistle-blowers. Barclays will reprimand Mr Staley in writing and cut last year’s bonus of £1.3m ($1.6m). By how much depends on the regulators’ findings.

After the financial crisis Barclays’ reputation took a battering. Mr Staley and his predecessor, Antony Jenkins, have tried to repair it. But new troubles are easily born, and old ones die hard. In 2012 Barclays was fined £290m for rigging LIBOR, a key interest rate; four of its traders were later jailed. On April 10th the BBC stirred bad memories, with fresh allegations about the scandal and questioning whether the whole truth had emerged in a parliamentary inquiry. Regulators are also examining Barclays’ raising of capital from Qatar in 2008.

It may not comfort Mr Staley that others had an even worse start to the week. Wells Fargo, America’s third-biggest bank by assets, castigated John Stumpf, its former boss, for tolerating sales practices that led to the opening of 2m-odd ghost accounts, for which Wells was fined $185m last year. Wells is reclaiming $69m from Mr Stumpf and $67m from Carrie Tolstedt, ex-head of its consumer bank. How was your Monday?

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