Barclays’ CEO James E. Staley has been awarded a fine for his attempts to find the identity of a whistle-blower, in spite of being warned against it. The decision was taken after inquiries by the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA).
Following a year-long probe into the matter, the regulators chose to fine Staley, but not remove him from his post as they did not believe he acted without integrity or that he was unfit to carry on with his role at Barclays (BCS). In addition to the penalties, Barclays said it would cut Staley’s 2016 bonus, which amounted to $1.6 million.
The board continues to support Staley. When Staley stepped into his role as CEO in 2015, Barclays had been plagued with legal and regulatory issues, which led to a hefty amount in fines and settlements along with unimpressive financial results. He was the fifth chief in seven years, and perhaps this was one of the reasons the authorities did not want to cause another shuffle in management.
Barclays’ board continues to support Staley
The whistle-blowing issue goes back to 2016 when Barclays officials received an anonymous letter expressing dissent over the hiring of a senior employee. The employee was a former colleague of Staley’s at JPMorgan (JPM) and Staley saw the letter as an attempt to malign him. Although the bank retained the hire, Staley tried to find out who wrote the letter. He continued his efforts despite being warned not to pursue the matter.
Staley’s actions came to light following employee complaints regarding the whistle-blowing process and an external investigation that followed the complaints. This led to more inquiries by the FCA and PRA that resulted in the latest decision. Barclays said Staley honestly but mistakenly believed his actions were correct.
Barclays shares rose slightly during morning hours in London.