Regulation  

Barclays execs accused of secret Qatar funding

The prosecution told how Barclays had legal obligation to disclose such fundraising to investors and the wider market.

One of the key document that must be published is called a 'prospectus', explained the prosecutor, adding that it contained within it who was investing and how much Barclays would pay for that investment.

"The publication of this information is a legal requirement," explained Mr Brown, adding that such disclosure must be honest and accurate.

"It ensures that there is transparency and that existing investors, prospective investors and the wider market are properly informed about what has happened.

"All experienced bankers know about the fundamental principles attaching to the contents of such public-facing documents, not least that they must contain the truth and must not mislead.

"In this case, in addition to the amounts which Barclays revealed that it was paying to the investors in the public-facing documents, additional commission fees for investing were paid to the Qataris, say the Crown, additional commission fees for investing that were not paid to other investors and were not revealed.

"It is the hiding of these additional commission fees which lies at the heart of this case and the conspiracies alleged against the defendants.

"Disguising and hiding extra fees to the tune, ultimately, of a total of nearly a third of a billion pounds."

Mr Brown told the jury that Barclays failed to disclose an additional £322m paid to the Qataris for investments.

For the capital raising in June 2008, the Qataris were paid an additional £42m in commission fees and by the end of October, during the second round of capital raising, they were paid a further fee of £280m.

"Those fees, £42m and £280m, were not revealed to the other investors.

"Parts of the documents published by Barclays were untrue and misleading," explained Mr Brown.

The court heard how Barclays had instead hidden the fees in 'Advisory Service Agreements', which falsely claimed that the Qataris were providing 'advisory services', in return for the multi-million pound fees.

"The evidence in this case shows why the ASAs, the Advisory Services Agreements, came into existence," explained Mr Brown, adding, "they were devised, say the Crown, by the conspirators as a mechanism for paying the Qataris greater fees than those paid to other investors, so as not to reveal the true position.

"They were therefore a disguise say the Crown.

"Against the background of the financial crisis, it was essential that Barclays secured the investment of the Qataris.

"The defendants in this case, and others at Barclays of course, knew that all too well.

"The evidence demonstrates that the Qataris drove a hard bargain for their investments."

Mr Brown told jurors that in June 2008, the sovereign wealth fund demanded a starting commission fees of 3.75 per cent on the agreed investments.