LONDON: A former Barclays executive told in-house lawyers he
felt sick when he was told the bank could be challenged by criminal
authorities over side deals with Qatar during a 2008 emergency
fundraising, a London fraud trial heard on Wednesday.
Richard Boath, in the dock at Southwark Crown Court with former
Barclays CEO John Varley and former senior colleagues Roger Jenkins
and Tom Kalaris, told investigators in 2016 he also thought Qatar
should have been told to “**** off” when it demanded additional
fees when helping bail the bank out.
The four men are charged with conspiracy to commit fraud by false
representation over how they secured a two-part, 11 billion
pound-plus ($14 billion) capital raising as the bank scrambled to
avoid a state bailout during the financial crisis.
The Serious Fraud Office (SFO), which is prosecuting the case,
alleges the defendants misled shareholders and other investors by
not disclosing that Barclays paid an extra 322 million pounds to
Qatar through advisory service agreements (ASAs), which the SFO
says were not genuine.
The men deny wrongdoing.
Extracts of transcripts of telephone conversations and emails were
read out and shown to the court by the prosecution on
Former in-house Barclays lawyer Judith Shepherd told Boath on June
18, 2008, that the bank had to show it had received valuable
services from Qatar in return for the ASA — or risk other
investors, the market regulator and criminal authorities viewing
them as disguised commissions for the capital raising.
“I’m already feeling sick. There’s no need to use all those
words to make me feel sicker,” Boath responded in the telephone
call, according to one transcript.
Eight years later, Boath told SFO investigators that although he
had not liked the Qatar deal, it had been negotiated by his
seniors, approved by lawyers and that he thought the bank believed
it would get value for the money.
“The lawyers persuaded themselves that even though they knew that
the ASA in June was a consequence, a response to the request from
the Qataris for additional fees, it didn’t matter as long as we
got value for services,” Boath, the bank’s former head of
European financial institutions group, told the SFO, according to
interview transcripts read out to court.
Boath said that Jenkins, who was negotiating with the Gulf state,
had “real heft” in Qatar and was a “big deal down there.”
“I believed Roger would get his pound of flesh,” he said,
according to the transcripts.
“I don’t think (former finance director) Chris Lucas or John
Varley would ever have signed off on it if they thought that they
were not going to get value for their services,” he added in a
recorded interview that was played to the court.
Asked by the SFO investigator if the ASA in June 2008 was a
disguised commission, Boath replied: “No. The advisory service
agreement was put in place by Barclays in exchange for services
that they expected Roger to get value for.”
“Judith goes on to say: ‘Well, Big Dog will be in the dock
first’,” the SFO investigator noted in the 2016 interview.
“Yeah, that’s Roger, by the way,” Boath said in the recorded
Lucas has not been charged because he is too unwell to stand trial,
the jury has been told. Shepherd, the Barclays lawyer, and Qatar
have not been accused of any wrongdoing.
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Source: FS – All-News-Economy
Former Barclays executive felt sick over 2008 Qatar deal, court hears