Barclays’ Qatari dealings become focus for SFO

By MARTIN FLANAGAN
Published on 30/08/2012 02:25

SHARES in scandal-hit Barclays face renewed turbulence today after the bank last night confirmed that the Serious Fraud Office (SFO) has started an investigation into payments between it and the sovereign investor Qatar Holdings.

Barclays disclosed at its interim results in August that the Financial Services Authority was investigating the matter. FSA sources confirmed yesterday that the financial regulator’s own inquiry is also continuing.

The investigations relate to fees paid to the Qatar Investment Authority, the investment arm of Qatar Holdings, as part of the bank’s £11.5 billion Middle and Far East capital-raisings in 2008 at the height of the financial crisis. Analysts say it is unusual for big new investors in a bank to receive fees.

Barclays’s £4bn interim profit announcement was overshadowed by the revelation that its finance director Chris Lucas was among four current and former senior staff being investigated on the capital-raisings by the FSA.

The bank is still reeling from another investigation after being fined a total of £290 million by the FSA and US regulators in June for rigging Libor interest rates.

That sparked criticism about Barclays’s culture and risk-taking and forced out its chairman and chief executive, Marcus Agius and Bob Diamond respectively.

Regulatory sources said there were well-established mechanisms for the FSA and SFO to work together on twin inquiries into a financial company.