(Bloomberg) -- Barclays Plc has been fined £40 million ($50.3 million) over the lender’s “reckless” failures to disclose details of its rescue by Qatar during the 2008 financial crisis, ending an eleven-year-long battle with British regulators.
The UK’s Financial Conduct Authority warned the lender back in 2013 that it planned to impose a penalty after finding Barclays didn’t fully disclose an agreement to pay advisory fees to Qatari investment vehicles as part of the bank’s crisis-era capital-raising efforts.
Barclays disputed the findings, and had referred the FCA’s decision to the upper tribunal for reconsideration. However, the lender on Monday said it had decided to drop that appeal, which had been due to be heard this week.
The regulator gave Barclays a £10 million discount on the fine after Barclays abandoned its legal challenge and the FCA reconsidered its findings, according to people familiar with the matter, who asked not to be named as the information hadn’t been made public.
“In view of the time elapsed since the events, Barclays wishes to draw a line under the issues referred to in the decision notices and has decided not to contest the decision notices further,” the bank said in a statement on Monday. “Barclays does not accept the findings of the decision notices and this has been acknowledged by the FCA.”
The bank took a provision for the penalty in 2022 and said Monday’s move has no material financial impact.
For Barclays, the settlement marks the end of the last major piece of litigation stemming from the financial crisis and avoids a fresh look at the moment when the bank raised a total of more than £11 billion to avoid a government bailout.
The Qatari fundraising has long been a legal headache, with a previous judge finding “serious deceit” by the bank. A separate criminal case brought by the Serious Fraud Office cleared three former executives in 2020.
The FCA’s investigation found Barclays “acted recklessly” by announcing the fundraising when it “must have been aware that it had not taken reasonable care to ensure” it was justified in paying fees of £280 million to Qatari entities, it said on Monday.
“Barclays’ misconduct was serious and meant investors did not have all the information they should have had,” Steve Smart, joint executive director of enforcement and market oversight at the FCA, said in a separate statement. “However, the events took place over 16 years ago and we recognize that Barclays is a very different organization today.”
(Updates with detail on fine discount as well as the history of the case throughout.)
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