Barclays fined $15m for whistleblowing breach

Barclays has been fined $15m by a US regulator after its chief executive Jes Staley attempted to unmask a whistleblower.

The New York State Department of Financial Services (DFS) found Barclays had violated local banking law and its own procedures during the handling of the matter.

The letters concerned an executive that Mr Staley had recruited.

Barclays said all regulatory probes into the matter had now concluded.

The matter dates back to 2016, when an anonymous person or persons sent two letters raising concerns about a former colleague Mr Staley had recruited to work at the bank, as well as the chief executive’s decision to hire him.

The letters questioned the executive’s fitness and qualifications to work at Barclays.

The New York regulator detailed how the first letter should have been treated as a whistleblower complaint and sent to the bank’s investigations and whistleblower team.

However, the letter was distributed among senior management, including Mr Staley.

The DFS’s investigation also discovered that Mr Staley had personally directed the head of Barclays’ security to attempt to find the writer of the two whistle-blowing letters, which the chief executive believed to be “false and malicious”.

Financial Services Superintendent Maria Vullo said: “Whistleblowers are vital to uncovering and addressing intentional wrongdoing.

The DFS’s thorough investigation uncovered actions at the top that exposed the bank to risk and created an atmosphere in which employees might doubt that it was safe to escalate issues of concern to the bank.”

It also said: “Several members of senior management failed to follow or apply whistle-blowing policies and procedures in a manner that protected the chief executive and the bank itself.”

As part of the agreement with the DFS, Barclays said it “agreed to undertake additional reporting and remediation undertakings in respect of its whistleblowing programme”.

Mr Staley was fined £642,430 in the UK for breaching rules by attempting to find the person or persons who wrote the letters.

Barclays also cut his bonus by £500,000.