Reuters
Former Barclays CEO John Varley.
- The judge in a trial of former Barclays CEO John Varley and three of his colleagues over an allegedly fraudulent deal with Qatar told a jury that entities connected to Qatar must be just as dishonest as the Barclays bankers, if the prosecution's case is correct.
- The UK Serious Fraud Office alleges that Varley and the other executives misled investors while raising funds from Qatar investors during the financial crisis.
- The defendants, including Varley's coworkers Roger Jenkins, Thomas Kalaris, and Richard Boath, all pleaded not guilty to charges of misleading investors in fundraising.
The judge in the historic Barclays trial in London told the jury that prosecutors must prove that the deals at the very heart of the trial were a "sham" that implicates both parties, not just those on Barclays' side of the deal.
Justice Robert Jay, referring to Barclays' agreements with Qatari investors at the dawn of the financial crisis in 2008, said jurors must not only be convinced that the deals were fake, but prosecutors also should show that the Qataris were part of the conspiracy.
"A sham agreement is one that does not mean what it says ... it requires two parties," Jay told the jurors. Entities connected to Qatar must be just as dishonest as Barclays bankers now on trial for fraud, if the prosecution's case is correct, Jay said.
The Serious Fraud Office (SFO) alleges that former Barclays CEO John Varley and other executives - Richard Boath, Thomas Kalaris, and Roger Jenkins - misled investors during the financial crisis in raising funds via financial instruments called "Advisory Service Agreements" (ASAs). The SFO alleges that the deals paid Qatari companies £322 million ($423 million) - a 3.25% commission - in secret fees that were not properly disclosed.
The defendants pleaded not guilty to all charges.
Reuters
Richard Boath.
It's a shift in focus to the other side of the Barclays deal. Ed Brown, prosecuting for the SFO, has previously told the court that "the Qataris are not on trial here."
The jury has repeatedly heard testimony that the executives were desperate for a capital injection to avoid being taken over and nationalized by the government. Rival bank RBS received a government bailout that year.
Referring to their own fundraising efforts, Stephen Jones a Barclays banker on a recording of a call dated May 7, 2008, that was played to the courtroom said: "It feels much better than the RBS deal, I have to say."
The trial is ongoing at Southwark Crown Court in London.
Read more: See all our coverage of the Barclays Qatar trial here.