A senior banker believed that Barclays documents lied about sums it was paying to Qatar to secure billions in investment from the emirate during the 2008 financial crisis, a court heard on Wednesday.
Telephone conversations suggested that Richard Boath, one of three men accused of fraud over attempts to avoid a government-backed takeover, thought that draft documents contained falsehoods about the bank’s planned financial dealings with Qatar, prosecutors said.
He thought one key section “told a lie – something he continued to think,” said Edward Brown, prosecuting for the Serious Fraud Office.
Mr Brown was making his closing submissions in a four-month trial of the most senior bankers accused of criminal acts over the 2008 financial collapse that saw three UK banks rescued by taxpayer money.
Barclays only survived the same fate after an £11.2 billion injection from investors. Qatar supplied more than a third of the total but demanded fees more than double of other investors, a fact that the bank sought to hide, according to the Serious Fraud Office which is bringing the case.
The trial has heard that if other investors learned of the bumper fees, the bank's financial weakness would be exposed and could lead to the collapse of the fundraising operation.
Mr Boath, the former head of financial services, Tom Kalaris, the former head of wealth management, and Roger Jenkins, the head of Middle East investment banking, all deny fraud. The court has heard that Mr Jenkins negotiated with then prime minister, Sheikh Hamad bin Jassim bin Jaber Al Thani and his senior advisers to secure the money but the Qatari played “hardball” in negotiations.
The trio were involved in a week of discussions to come up with a solution to pay Qatar the fees they demanded in a way that would pass the “smell test” and avoid landing them in jail, London’s Old Bailey court was told.
“’None of us want to go to jail here’ is a plain reference to possible criminality,” said Mr Brown. If they failed to come up with a solution and Qatar pulled out it would be a “disaster of unmitigated proportions”, the court heard.
A failure to secure the money would see the UK government take control of the bank which would have affected their jobs and lucrative salaries, the court has heard.
Prosecutors say emails and telephone calls implicate the men in a plot to come up with a way of getting Qatar the £322 million it demanded in return for its £4 billion investment without raising the alarm to other investors.
The Serious Fraud Office said the bankers mulled a series of schemes including paying Qatar a cash lump sum and a “rigged” hedge fund operation.
They eventually came up with a “fake” agreement to pay Qatar in return for helping Barclays secure more business in the Middle East.
The case continues.
Sholto Byrnes on Myanmar politics
Profile
Name: Carzaty
Founders: Marwan Chaar and Hassan Jaffar
Launched: 2017
Employees: 22
Based: Dubai and Muscat
Sector: Automobile retail
Funding to date: $5.5 million
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Women's Prize for Fiction shortlist
The Silence of the Girls by Pat Barker
My Sister, the Serial Killer by Oyinkan Braithwaite
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Global state-owned investor ranking by size
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Canada
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Profile
Company: Justmop.com
Date started: December 2015
Founders: Kerem Kuyucu and Cagatay Ozcan
Sector: Technology and home services
Based: Jumeirah Lake Towers, Dubai
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Tearful appearance
Chancellor Rachel Reeves set markets on edge as she appeared visibly distraught in parliament on Wednesday.
Legislative setbacks for the government have blown a new hole in the budgetary calculations at a time when the deficit is stubbornly large and the economy is struggling to grow.
She appeared with Keir Starmer on Thursday and the pair embraced, but he had failed to give her his backing as she cried a day earlier.
A spokesman said her upset demeanour was due to a personal matter.
