IT WAS ALWAYS a bit odd that when the UK banking system teetered on the brink of collapse during the global economic crash of 2008, Barclays Bank was almost alone in not need a taxpayers’ bailout – and, therefore, escaped any suggestion that it would be subject to any kind of government control in return for the cash.
At the time, Barclays said it had been able to sort out its finances – thanks in large part to an injection of funds from Qatar. Now four of its senior executives from that time have been charged with conspiracy to commit fraud. This is the first time bank executives have been charged in this way in connection with their response to the 2008 crisis, and the criminal charges against named individuals are unprecedented.
Full details of the charges and the actions which led to them have not yet been made public. However, at this early stage it appears that the executives are likely to allege that their actions were sanctioned by Barclays – and use this as a main part of their defence.
The charges appear to relate to the £12 billion which Qatar lent Barclays during the crisis. Some of the charges suggest that the executives actually paid incentives to Qatar in return for the loans provided. They also relate to the allegation that the executives did not disclose fees which they personally received as part of arranging the deal.
It is a curious time for the charges to be made. Many countries in the Middle East are currently trying to isolate Qatar, which owns a great deal of land and property in the UK – in particular, in East London. The charges are brought by the Serious Fraud Office – which had a past attempt to pursue charges in connection with high level financial deals between the UK and Saudi come to nothing, after a long period of political pressure.
Will the courts side with Saudi and its local allies against Qatar, risking the economic consequences of Qatar pulling its money out of the UK? Or will Qatar’s economic position in the UK influence the courts not to pursue the charges?
Time will tell, but at the moment this looks like what appear to be simple criminal charges could have explosive consequences.