Barclays Bank charged over 'unlawful' Qatar loans

#Crime

The charges over emergency fundraising from Qatar in 2008 follow an earlier case against the bank's four executives

Barclays Bank global headquarters in London (AFP)
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Monday 12 February 2018 12:54 UTC
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Barclays Bank has been charged by the UK’s Serious Fraud Office (SFO) over a $3bn loan to Qatar as part of a package linked to emergency fundraising during the 2008 financial crisis.

The fresh charge for “unlawful financial assistance” against the banking and finance firm comes after charges were brought against Barclays' holding company and four former executives last July.

Now the SFO has decided to charge Barclays Bank over the loan, in a move that might threaten the lender’s ability to do business globally, including in Qatar.

Qatari investment

“Barclays does not expect there to be an impact on its ability to serve its customers and clients as a consequence of the charge having been brought,” the company said in a statement.

The SFO probe focuses on emergency fundraising by the bank carried out in 2008 to avoid the fate of bailed-out rivals, including Lloyds Banking Group and the Royal Bank of Scotland.

As other banks struggled to find funding, executives at Barclays secured a vast $16.4bn fundraising package from Qatari backers, Abu Dhabi royals and other investors from Singapore. This allowed the firm to avoid a UK government bailout and subsequent government control.

However, the level of the Qatari investment immediately raised eyebrows in the City and prompted an SFO investigation in 2012.

The investment deal included a $3bn loan made to Qatar acting through its Ministry of Economy and Finance in November 2008, which the SFO claims was used unlawfully to buy shares in Barclays,

The case marks the first criminal case to be brought against a bank and its former executives for activities during the financial crisis. It also puts into focus the role played by Qatar in the UK's financial system.

Monopoly assets

London is awash with Qatari investments that symbolise the two countries' extremely close financial ties.

Qatar, which by capita is the richest nation on earth, has invested more than £40bn in the UK, much of it in London.

The country now owns, via its Qatar Investment Authority (QIA), more than three times as much property in the British capital as the Queen, and recently pledged a further £5bn investment package to boost what has been called its "Monopoly board of trophy assets".

A court appearance for Barclays will be “set in due course”, said the SFO in a statement. Middle East Eye has contacted the Qatari embassy in London for comment.

Details of Qatari involvement are likely to become clearer when former chief executive John Varley, former senior investment banker Roger Jenkins, Thomas Kalaris, a former chief executive of Barclays' wealth division, and Richard Boath, the ex-European head of financial institutions, face trial next year.