By Geoffrey Smith
Investing.com -- Jes Staley is to step down as chief executive of U.K. bank Barclays (LON:BARC) after an investigation into his ties with the late financier Jeffrey Epstein by U.K. regulators.
The bank said that it had become aware of the "preliminary conclusions" of a probe by the Financial Conduct Authority and Prudential (NYSE:PUK) Regulatory Authority into Staley's links to Epstein, and how Barclays had represented them in a statement to the regulators.
The bank said its board is "disappointed with this outcome."
Staley had successfully shepherded Barclays through a difficult few years, fighting off an activist investor campaign that disputed his strategy of betting big on Barclays' investment bank. The unit delivered record profits through the early phases of the pandemic, and Barclays signaled that it will keep a strong focus on its investment bank despite the change at the top, appointing head of global markets C.S. Venkatakrishnan to take over as CEO.
However, Staley's tenure had also been marked by controversy, including a run-in with regulators over his hounding of a whistleblower, and, for the last 18 months, by his links to Epstein, who committed suicide while awaiting trial for sex crimes. The inquiry by the FCA and PRA was launched after U.S. regulators handed emails between the two men to the U.K. bodies.
Staley had known Epstein as a client when he headed JPMorgan's (NYSE:JPM) wealth management business in the early 2000s. However, he stayed in touch with Epstein long after the latter was convicted of soliciting prostitution from a minor in 2008. Acccording to various reports, Staley visited Epstein in Florida while he was still serving his sentence in 2009, and visited Epstein's private island as late as 2015.
The bank said that the probe, which is still continuing, "makes no findings that Mr Staley saw, or was aware of, any of Mr Epstein's alleged crimes."