Jes Staley Loses Bid to Overturn Ban Over Jeffrey Epstein Friendship
(Bloomberg) -- Former Barclays Plc boss Jes Staley lost a legal battle to overturn his ban from UK finance over his relationship with Jeffrey Epstein, all but ending his attempt to rehabilitate himself in the British financial services industry.
A London judge sided with the Financial Conduct Authority, ruling that the executive misled officials about the nature of the banker's relationship with the late pedophile financier.
'He has shown no remorse for his conduct which has led to the authority's investigation,' Judge Timothy Herrington said in his ruling on Thursday.
Staley had brought the legal challenge, the most high-profile court case between the City regulator and any executive in recent years, in a bid to overturn the watchdog's move to fine and ban him from the industry.
'He hoped that the truth would never come to light and that he would get away with it,' Therese Chambers, joint executive director of enforcement and market oversight at the FCA, said in a statement after the ruling. 'Such a serious lack of integrity flies in the face of the requirements we place on those at the top.'
The judge did cut the fine Staley has to pay to £1.1 million ($1.5 million), reduced from £1.8 million to reflect the former banking executive's loss of share awards following the FCA's punishment.
A lawyer for Staley didn't immediately respond to a request for comment. Staley has 14 days to appeal the ruling.
During the trial the FCA displayed reams of emails showing the pair's close friendship, detailed Staley's visits to Epstein's Caribbean island and revealed that the banker had sex with an Epstein staffer. Still, Staley argued that the FCA's supervisory head had never been sufficiently clear with Barclays in his preliminary inquiries and that the bank's officials collectively drafted the letter at the center of the case.
'In our view, the evidence that Mr. Staley had a close relationship with Mr. Epstein is overwhelming,' the judge said.
Staley turned up in court every day during the trial, giving testimony for four days. He said that Epstein had introduced him to 'three of the five wealthiest people in the world' during his days as a senior executive at JPMorgan Chase & Co., saying he had the 'best rolodex.'
The judge zeroed in on JPMorgan's decision to retain Epstein as a client even after bank officials became concerned about reports of Epstein's involvement in sex trafficking. The judge said it was 'more likely than not' that Staley's support for Epstein ensured that the US bank kept the disgraced financier as a client.
While the judge said Staley didn't set out to mislead the tribunal, some of his evidence 'lacked credibility.'
'It was often the case that his memory was clear on matters which were helpful to his case, but not so in relation to matters that called for an explanation,' the judge said.
During the hearings, the FCA argued that Staley's relationship went well beyond a professional one and that he deliberately minimized a 'deeper and more profound' affinity.
Epstein was jailed in Florida in June 2008 for soliciting sex from underage girls. He was arrested again in July 2019 on federal charges relating to, among other things, the sex trafficking of minors, shortly before his death in a New York jail cell. Staley stepped down from Barclays two years later.
Staley argued that he never knew the whole story about Epstein. In one exchange, a Barclays executive said Staley had told her, 'why would I have introduced my wife and daughters to Mr. Epstein if I thought he was a pedophile?'
The trial saw some of the most senior figures in the City of London, including Bank of England Governor Andrew Bailey and Barclays Chairman Nigel Higgins, give evidence.
'We have noted Mr. Staley's achievements as chief executive of Barclays, but in our view these do not diminish the seriousness of the misconduct,' Herrington said in his ruling. 'The loss of his longstanding career is an inevitable consequence of that conduct.'
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