Barclays CEO Jes Staley is leaving the bank after a dispute with British financial regulators over his ties with convicted sex offender Jeffrey Epstein.
Staley will be replaced as CEO by Barclays’ head of global markets C.S. Venkatakrishnan, who on Monday pledged to continue his predecessor’s strategy.
Staley’s shock departure comes after Barclays was informed on Friday of the unpublished findings of a report by Britain’s Financial Conduct Authority and the Prudential Regulatory Authority into Staley’s relationship with Epstein.
Epstein killed himself in jail in August 2019 while awaiting trial on federal charges related to sex trafficking.
“In view of those conclusions, and Mr Staley’s intention to contest them, the Board and Mr Staley have agreed that he will step down from his role as Group Chief Executive and as a director of Barclays,” the bank said.
“It should be noted that the investigation makes no findings that Mr Staley saw, or was aware of, any of Mr Epstein’s alleged crimes, which was the central question underpinning Barclays’ support for Mr Staley following the arrest of Mr Epstein in the summer of 2019.”
Barclays shares fell 2% following the announcement.
“I THOUGHT I KNEW HIM WELL”
Staley dealt with Epstein during his long career at JPMorgan, where Epstein was a major private banking client until 2013.
A college dropout who styled himself as a brilliant financier, Epstein socialised in elite circles, including former and future U.S. presidents.
In 2008, he was registered as a sex offender but continued to maintain ties with powerful players in business and finance.
The New York Times reported in 2019 that Epstein had referred “dozens” of wealthy clients to Staley.
It also reported that Staley visited Epstein in prison when he was serving a sentence between 2008-09 for soliciting prostitution from a minor, while Bloomberg reported he visited Epstein’s private island in 2015.
Staley told reporters last February that his relationship with Epstein had “tapered off significantly” after he left JPMorgan in 2013, and that he had not seen the disgraced financier since taking over Barclays in 2015.
“I thought I knew him well, and I didn’t. I’m sure with hindsight of what we all know now, I deeply regret having had any relationship with Jeffrey Epstein,” he said at the time.
Epstein’s links with prominent men have come back to haunt some of them. Leon Black, the billionaire investor, stepped down from Apollo Global Management, the private equity firm he co-founded, earlier this year after an outside review found he had paid Epstein $158 million for tax and estate planning.
Britain’s Prince Andrew has quit royal duties over his associations with Epstein, and Microsoft co-founder Bill Gates has said it was a “huge mistake” to spend time with him.