Barclays has received a £40 million fine from the FCA, with the regulator stating that its 2008 capital raising was “reckless and lacking integrity”.
Between June and October 2008, Barclays received investments from “certain Qatari entities” during capital raising, the FCA reported. At the same time, Barclays entered two advisory agreements with one of the entities totalling £322 million. “These payments were calculated specifically by reference to the Qataris’ financial demands for investing in the capital raisings, not the value of the advisory services that Barclays expected to receive under the agreements,” the FCA stated in its 2022 decision notice on the matter.
Barclays disclosed the first advisory agreement in June 2008, but not the second, during emergency recapitalisation in October. The connections of these agreements to its capital raising and the Qatari entities which invested were not shared, information which the FCA said would have been highly relevant to shareholders, investors and the wider market.
The payments more than doubled what Barclays had disclosed as paid to the Qatari entities for their participation in the June and October capital raising rounds.
The FCA first issued warning notices to Barclays in 2013, before the case was paused due to pending criminal proceedings. It was resumed in 2020, with the FCA publishing its final decision on the case in October 2022. The fine has been reduced since this decision, having been initially valued at £50 million.
Given that the incident took place during the Global Financial Crisis, “the FCA recognises that this case concerns disclosure decisions made in the context of very large and complex capital raisings that took place many years ago under considerable market pressure,” it said.
“Barclays is a very different organisation today, having implemented change across the business,” added Steve Smart, joint executive director of enforcement and market oversight at the regulator.
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