The prosecutor of the British Serious Fraud Office (SFO) presented new evidence to the jury at the Southwark Crown Court, in the case against Barclays Bank's executive on charges of fraud.
Former Barclays executive Richard Boath was caught on recording talking with ex-Middle East head Roger Jenkins who was considering methods to channel the sums demanded by Qataris before investing multi-billion Sterling pounds in Barclays at the height of the 2008 financial crisis.
The audio reveals a state of tension between the two former executives, as Boath opposed the idea of a side deal because he did not think it was right to pay certain investors more than others.
Qataris insisted on getting more than double what other investors were receiving during the fundraising and Jenkins asked Boath to find a better way to pay the fees.
The total amount of “fees” paid to Sheikh Hamad bin Jassim reached 322 million pounds which ensured that Qatar would make an investment of 4 billion pounds, allowing Barclays to avoid nationalization, according to Bloomberg
Top bankers connected to the financial crisis, then-Chief Executive Officer John Varley, Jenkins, Boath, and former Barclays wealth management boss Tom Kalaris are accused of dishonestly hiding the fees from other investors and fabricating records.
Qatari officials were happy to go ahead with an advisory deal, through bin Jassim's Challenger, as a way of receiving the fees, Boath recalled Jenkins as saying.
Whereas Boath said the idea had actually come from someone on his own team, he still had reservations about the plan.
“We can’t do a transaction in which we give one set of fees to the market or to one set of economics for one group of investors and we have a different set of economics for another set of invests, because if they found out they’ll go completely nuts. You can’t do that,” Boath was quoted by Bloomberg.
“We can’t do that.’ I was quite vigorous, because I felt it quite strongly,” Jenkins then agreed that it wasn’t worth the risk, Boath told the Office.
The former executive recalled that, along with Jenkins, he felt the deal was not worth doing just to protect Varley and ex-investment bank head Bob Diamond, who may have lost their jobs if the bank was nationalized.
In an attempt to lay the blame on the legal team, Boath told investigators that then General Counsel Mark Harding signed off on the arrangement as long as the bank received sufficient value from the advisory deal.
Top officials like Varley, then-Chief Financial Officer Chris Lucas, including Harding’s deputy Judith Shepherd, and its external lawyers at Clifford Chance had all agreed to the arrangement, Boath was happy for it to go ahead, he admitted during investigations.
Lucas had been identified as a co-conspirator, however, he was deemed too ill to stand trial for having Parkinson’s disease.
Boath went on to say that he was clearly instructed, and repeatedly, throughout the transaction in conversations he had with people in the legal department that they had it covered.
“I’d been told that Mark Harding was all over it. Judith Shepherd is now all over it. I can relax.”
