Barclays Group  

Barclays deal branded 'horrible' by former chief

Barclays deal branded 'horrible' by former chief

A former Barclays chief accused of funnelling millions of pounds to Qatari investors in return for emergency funding at the height of the financial crisis described the deal as "f**king horrible".

Ex-Barclays Capital boss Richard Boath, 60, is accused alongside former chief exec John Varley, 62, and colleagues Roger Jenkins, 63, and Tom Kalaris, 63, of fraudulently covering up a deal worth billions of pounds.

The bankers raised £11.8bn in emergency fundraising from Qatar in 2008 by making secret payments to the Gulf state in a separate deal called an advisory services agreement or ASA.

Article continues after advert

The full extent of the deal - which allowed the bank to avoid taking a taxpayer bailout - was allegedly covered up by the defendants in order to protect their enormous bonuses.

Southwark Crown Court yesterday (March 4) heard how Boath fretted about the legality of the deal, which prosecutors claim was a front for paying the Qataris higher investment fees.

But instead of entering into the alleged side deal, Boath suggested that all investors should be paid the same rate as the Qataris, adding: "You wouldn't have this f**king horrible advisory agreement."

Boath told investigators at the Serious Fraud Office that his stress subsided after the bank's lawyers became involved in the deal: "I'm relieved but I don't like it."

During the SFO interviews, Boath was asked: "Did the Qataris consider the advisory services agreement as distinct from the capital raising?"

"No," replied the banker.

The advisory agreement, which saw the bank pay £42m in fees to the Gulf state, was ostensibly made in return for advice on how to tap into the region's oil and gas markets.

Prosecutors allege that the defendants tried to avoid creating a paper trail by sending key documents over fax rather than by email.

Boath told interviewers: "It wasn't that I was trying to conceal anything, I was simply nervous because I knew it was highly sensitive."

During the interview, Boath explained that the idea of an advisory agreement came from a member of his team but he was told that there could be difficulties with such an arrangement.

"Around this time, Roger [Jenkins] and I are speaking quite regularly. Roger says, can you go away and find a mechanism, a deal structure, that will enable us to pay the Qataris additional value - something we can enter into with them that will give them this additional money, value."

Boath told investigators that one of his team, Mario Mariani, suggested a services agreement.

The banker explained that if they were to sign up for such an agreement, they would need to ensure that it was legitimate.

Boath explained how he expressed concern that the "sweetheart deal" might be discovered.

He told investigators after discussing the deal with other executives and the bank's legal department, he came to believe that the deal was legal.

He said it was "something that Barclays could entering into providing that Barclays got value for the fees they were paying".