'We can't go to prison - the food's bad and the sex is worse': What Barclays banker
A Barclays boss said the bank would collapse without a multi-billion-pound bailout from Qatar, a court heard yesterday.
As the 2008 financial crisis raged, the bank’s executives were desperate to avoid a Government bailout and protect their salaries and ‘very large bonuses’, prosecutors said.
To keep the bank afloat, four top executives agreed to funnel £322 million in secret fees to Middle Eastern investors, it is claimed.
The Qataris had the bank ‘by the b****’, meaning they could drive a ‘hard bargain’, a senior banker told colleagues.
The court heard that Tom Kalaris, former chief executive of wealth management, told the bank’s then-finance boss Richard Boath that he did not want anyone from the bank to go to jail over the deal because ‘the food sucks and the sex is worse’.
In June 2008, Boath said of a Qatari negotiator: ‘What he doesn’t realise is that if he doesn’t come through with his money, we’re f*****.’
Boath, Kalaris, ex-Barclays chief executive John Varley and fellow former banker Roger Jenkins are on trial at London’s Southwark Crown Court charged with conspiracy to commit fraud.
They are accused of hiding commission fees paid to Qataris to sweeten the multi-billion-pound investment deal from shareholders and other investors.
It is claimed that to keep the bank afloat, four top executives at Barclays agreed to funnel £322 million in secret fees to Middle Eastern investors (file picture)
Prosecutor Edward Brown QC told the jury that in the lead-up to the deal, Kalaris remarked in an email that the Qataris played ‘frankly a little harder ball’ than expected.
He read from a communication in which Boath said: ‘Without £1billion, at the very least, from [Qatar] we are basically dead.’
Mr Brown said that by early June 2008 the defendants knew the Qataris wanted to be paid ‘substantially more’ than the fee other investors were getting.
He added: ‘The conspirators agreed to use the advisory services agreement [ASA] as the dishonest mechanism to get around the problem of how to pay the Qataris a greater fee than the others and entered into, the Crown say, the conspiracy.’
The prosecution said that, while other investors were paid 1.5 per cent in commission fees, the Qataris ended up getting more than double that.
Investment bankers working under the quartet said they ‘could not find a structure that would look acceptable to an ordinary shareholder’, so the ASA structure was devised, the prosecution claimed.
The Qataris, through Qatar Holding and the Qatar Investment Authority, eventually made investments in Barclays of approximately £1.9 billion in June 2008 and £2.05 billion in November 2008, the court has heard.
Tom Kalaris, 63, pictured, is on trial with three others at London’s Southwark Crown Court charged with conspiracy to commit fraud
Varley and Jenkins, a former executive chairman of investment banking for Barclays Capital, also deny a second fraud count in relation to the second capital raising.
The trial, expected to last four to six months, continues.
Via Daily Mail