Barclays Bank Plc

On 23 September 2022, the FCA decided to impose a financial penalty on Barclays Bank Plc. The reason for this action is because Barclays Bank Plc failed to comply with Listing Rule 1.3.3 in October 2008. This matter has been referred by Barclays Bank Plc to the Upper Tribunal. The FCA’s findings and proposed action are therefore provisional and will not take effect pending determination of this matter by the Upper Tribunal. The FCA’s decision was issued on 23 September 2022 and a copy of the Decision Notice is displayed on the FCA's web site here: https://www.fca.org.uk/publication/decision-notices/barclays-bank-plc-dn-2022.pdf  

On 24 February 2022, the FCA imposed a financial penalty on Barclays Bank Plc. The reason for this action is because the firm failed to conduct its business with due skill, care and diligence and thereby breached Principle 2. As a consequence of this action, the FCA imposed a penalty of £783,800. The FCA’s action took effect on 24 February 2022 and a copy of the Final Notice is displayed on the FCA's web site here: https://www.fca.org.uk/publication/final-notices/barclays-bank-plc-2022.pdf  

On 15 December 2020, the FCA fined Barclays Bank UK PLC, Barclays Bank PLC, Clydesdale Financial Services Limited (Barclays) . The reason for this action is that between 1 April 2014 and 31 December 2018, Barclays breached Principles 6 and 3 of the Authority’s Principles for Businesses and CONC 6.7.2R, 7.2.1R and 7.3.4R from its Consumer Credit sourcebook by failing to show forbearance and due consideration to business and retail customers when they fell into arrears or experienced financial difficulties. The FCA’s action took effect on 15 December 2020 and a copy of the Final Notice is displayed on the FCA's web site here https://www.fca.org.uk/publication/final-notices/barclays-2020.pdf  

On 25 November 2015, the Authority imposed a financial penalty of £72,069,400 on Barclays Bank plc (“Barclays”) for breaches of Principle 2 (due skill, care and diligence) between 23 May 2011 and 24 November 2014 (“the Relevant Period”).   Barclays agreed to settle at an early stage of the Authority’s investigation. Barclays therefore qualified for a 30% (Stage 1) discount under the Authority’s executive settlement procedures. Were it not for this discount, the Authority would have imposed a financial penalty of £80,542,000 on Barclays.  Barclays failed to minimise the risk of financial crime in connection with a multi-billion pound Transaction executed for ultra-high net worth politically exposed persons (the Clients). As a result of the confidentiality requirements, Barclays determined that’s its usual processes for dealing with PEPs and assessing financial crime risks were not appropriate for the Business Relationship. Instead, Barclays sought to address the financial crime risks associated with the Transaction in an ad hoc way. In doing so, Barclays did not exercise due skill, care and diligence. It failed to identify, assess and monitor any risks appropriately. Specifically, in breach of Principle 2: a)    Barclays’ front office and senior management failed adequately to oversee Barclays’ handling of the financial crime risks that were associated with the Business Relationship.  b)    Having classified the Clients as Sensitive PEPs, Barclays failed to appropriately identify and address through its due diligence processes a number of features of the Business Relationship that the Authority considers could have indicated a higher risk of financial crime. c)    Barclays did not follow its standard procedures that it would normally follow for establishing relationships with Sensitive PEPs or put acceptable alternative procedures in their place.   d)    Barclays failed to establish adequately the purpose and nature of the Transaction and did not sufficiently corroborate the Clients’ stated source of wealth and source of funds for the Transaction.   e)    Barclays failed to monitor appropriately the financial crime risks associated with the Business Relationship on an ongoing basis. f)    Barclays failed to maintain adequate records of the due diligence it undertook in connection with the Business Relationship and to ensure that those records were readily identifiable and capable of retrieval. As a consequence, Barclays’ threatened confidence in the UK financial system and failed to mitigate the risk to society of financial crime. A copy of the Final Notice is displayed on the Authority’s web site and can be accessed using the following link: http://www.fca.org.uk/your-fca/documents/final-notices/2015/barclays-bank-plc-nov-2015  

The Financial Conduct Authority (the “FCA”) has imposed a financial penalty of £284,432,000 on Barclays Bank Plc, FRN 122702, 1 Churchill Place, London, E14 5HP.   The FCA’s action took effect on 20 May 2015 and a copy of the Final Notice, which sets out the reason for the action, is displayed on the FCA's web site and can be accessed using the following link:   https://www.fca.org.uk/your-fca/documents/final-notices/2015/barclays-bank-plc The reason for this action is that Barclays failed properly to control its London voice trading operations in its G10 spot FX; Emerging Market spot FX and G10 and EM FX options businesses and its G10 and EM FX sales operations associated with its FX business.  

On 23 September 2014, the Authority imposed a financial penalty of £37,745,000 on Barclays Bank plc (Barclays) for breaches of Principles 3 (Management and Control) and 10 (Clients' Assets) of the Authority's Principles for Businesses (the Principles) and associated Client Asset Rules (CASS) in the FCA's Handbook. Barclays agreed to settle at an early stage of the Authority's investigation. Barclays therefore qualified for a 30% (Stage 1) discount under the Authority's executive settlement procedures. Were it not for this discount, the Authority would have imposed a financial penalty of £53,921,619 on Barclays. Barclays failed to adequately protect approximately £16.5 billion of clients' safe custody assets between 1 November 2007 and 24 January 2012 (the Relevant Period). The Authority found significant deficiencies in Barclays' systems and controls in the opening, on-going operation and monitoring of external safe custody accounts, and failures in arranging adequate protection for certain of the safe custody assets for which it was responsible. Specifically, in relation to its safe custody assets arrangements in its Investment Banking Division, during the Relevant Period Barclays breached: a) Principle 3: by failing to take reasonable care to organise and control its affairs responsibly with adequate risk management systems in order to ensure that it: i. had in place adequate organisational arrangements in respect of safe custody assets; and ii. implemented and maintained adequate policies and procedures to detect and manage its safe custody asset risks. b) Principle 10: by failing to arrange adequate protection for safe custody assets when it was responsible for them. Barclays' failings also meant that it breached CASS 1A.2.8R, 6.2.1R, 6.2.2R, 6.3.1R, 6.5.1R, 6.5.2R and 6.5.6R. As a consequence of Barclays' breaches its' clients were at risk of incurring extra costs, lengthy delays or losing their assets if Barclays had become insolvent during the Relevant Period. A copy of the Final Notice is displayed on the Authority's web site and can be accessed using the following link: http://www.fca.org.uk/your-fca/documents/final-notices/2014/barclays-bank-plc-sept-2014

1. On 23 May 2014, the FCA imposed a penalty of £26,033,500 on Barclays Bank PLC (Barclays) for breaches of Principles 3 and 8, for failing to manage conflicts of interest, as well as systems and controls failings in relation to the London Gold Fixing. Were it not for the Stage 1 settlement discount, the penalty would have been £37,190,800. Conflicts of Interest 2. Between 7 June 2004 and 21 March 2013 (Relevant Period), Barclays breached Principle 8 by failing to adequately manage certain conflicts of interest between itself and its customers. In particular, Barclays failed to adequately manage the inherent conflict of interest that existed from (i) Barclays participating in the Gold Fixing and contributing to the price fixed during the Gold Fixing, while at the same time also (ii) selling to customers options products that referenced, and were dependent on, the price of gold fixed in the Gold Fixing, by not putting in place policies, procedures, systems and training in relation to the Gold Fixing which would have adequately enabled its staff to properly identify and manage the risks arising from this inherent conflict of interest. 3. Barclays' lack of specific training and guidance, given the absence of clear and sufficiently-tailored policies and procedures with respect to the Gold Fixing, meant that Barclays' personnel (including supervisors) may have been unaware of which conflicts of interest they should pay particular attention to in relation to the Gold Fixing. 4. On 28 June 2012 the risk created by Barclays' failure to adequately manage the inherent conflict of interest was realised when a Barclays trader participated actively in the 3:00 p.m. Gold Fixing even though he was responsible for risk-managing an options contract that was dependent on the price of gold fixed in that Gold Fixing. The Barclays trader placed orders with intention of increasing the likelihood that the price of gold would fix below a certain level, preferring his interests over those of a customer. Systems and controls failings 5. For the following reasons, Barclays breached Principle 3 by failing to take reasonable care to organise and control its affairs responsibly and effectively with adequate risk management systems in relation to the London Gold Fixing process: (i) During the Relevant Period Barclays failed to create or implement adequate policies or procedures to properly manage the way in which Barclays' traders participated in the Gold Fixing; (ii) During the Relevant Period Barclays failed to provide adequate specific training to Precious Metals Desk staff in relation to their participation in the Gold Fixing; and (iii) During the Relevant Period Barclays failed to create systems and reports that allowed for adequate monitoring of its traders' activity in connection with the Gold Fixing. The systems and reports did not formally record orders placed by traders in the Gold Fixing until 5 February 2013 and did not identify Gold Fixing transactions separately from general gold spot trades until 21 March 2013.

On 27 June 2012, the FSA imposed a penalty of £59.5 million on Barclays Bank PLC (Barclays) in accordance with section 206 of the Financial Services and Markets Act 2000. The fine was imposed for Barclays' breaches of Principles 2, 3 and 5 through misconduct relating to its submissions of rates which formed part of the London Interbank Offered Rate (LIBOR), and in respect of the submission of rates for the Euro Interbank Offered Rate (EURIBOR) setting processes. There was a risk that Barclays' misconduct would threaten the integrity of these benchmark reference rates. Barclays agreed to settle at an early stage of the FSA's investigation. Barclays therefore qualified for a 30% (stage 1) discount under the FSA's executive settlement procedures. Were it not for this discount, the FSA would have imposed a financial penalty of £85 million on Barclays. LIBOR and EURIBOR are benchmark reference rates fundamental to the operation of both UK and international financial markets, including markets in interest rate derivatives contracts. LIBOR and EURIBOR are by far the most prevalent benchmark reference rates used in euro, US dollar and sterling over the counter (OTC) interest rate derivatives contracts and exchange traded interest rate contracts. LIBOR and EURIBOR are used to determine payments made under both OTC interest rate derivatives contracts and exchange traded interest rate contracts by a wide range of counterparties including small businesses, large financial institutions and public authorities. Benchmark reference rates such as LIBOR and EURIBOR also affect payments made under a wide range of other contracts including loans and mortgages. The integrity of benchmark reference rates such as LIBOR and EURIBOR is therefore of fundamental importance to both UK and international financial markets. - Inappropriate submissions following requests by derivatives traders Barclays acted inappropriately and breached Principle 5 on numerous occasions between January 2005 and July 2008 by making US dollar LIBOR and EURIBOR submissions which took into account requests made by its interest rate derivatives traders (Derivatives Traders). At times these included requests made on behalf of derivatives traders at other banks. The Derivatives Traders were motivated by profit and sought to benefit Barclays' trading positions. The definitions of LIBOR and EURIBOR require submissions from contributing banks based on borrowing or lending in the interbank market. The definitions do not allow for consideration of derivatives traders' positions. It was inappropriate for Barclays to make US dollar LIBOR and EURIBOR submissions which took its Derivatives Traders' positions (or the positions of traders at other banks) into account. Barclays did not therefore observe proper standards of market conduct when making US dollar LIBOR and EURIBOR submissions. Barclays also breached Principle 5 on numerous occasions between February 2006 and October 2007 by seeking to influence the EURIBOR (and to a much lesser extent the US dollar LIBOR) submissions of other banks contributing to the rate setting process. Where Barclays made submissions which took into account the requests of its own Derivatives Traders, or sought to influence the submissions of other banks, there was a risk that the published LIBOR and EURIBOR rates would be manipulated. Barclays could have benefitted from this misconduct to the detriment of other market participants. Where Barclays acted in concert with other banks, the risk of manipulation increased materially. - Inappropriate submissions to avoid negative media comment Barclays acted inappropriately and breached Principle 5 on numerous occasions between September 2007 and May 2009 by making LIBOR submissions which took into account concerns over the negative media perception of Barclays' LIBOR submissions. Liquidity issues were a particular focus for Barclays and other banks dur the financial crisis and banks' LIBOR submissions were seen by some commentators as a measure of their ability to raise funds. Barclays was identified in the media as having higher LIBOR submissions than other contributing banks at the outset of the financial crisis. Barclays believed that other banks were making LIBOR submissions that were too low and did not reflect market conditions. The media questioned whether Barclays' submissions indicated that it had a liquidity problem. Senior management at high levels within Barclays expressed concerns over this negative publicity. Senior management's concerns in turn resulted in instructions being given by less senior managers at Barclays to reduce LIBOR submissions in order to avoid negative media comment. The origin of these instructions is unclear. Barclays' LIBOR submissions continued to be high relative to other contributing banks' submissions during the financial crisis. - Systems and controls failings Barclays breached Principle 3 from January 2005 until June 2010 (the Relevant Period) by failing to have adequate risk management systems or effective controls in place in relation to its LIBOR and EURIBOR submissions processes. Barclays had no specific systems and controls in place relating to its LIBOR and EURIBOR submissions processes until December 2009 (when Barclays started to improve its systems and controls). The extent of Barclays' misconduct was exacerbated by these inadequate systems and controls. Barclays failed, at a number of appropriate points during the Relevant Period, to review whether its systems and controls were adequate. - Compliance failings Barclays failed to conduct its business with due skill, care and diligence when considering issues raised internally in relation to its LIBOR submissions. Barclays therefore breached Principle 2. LIBOR issues were escalated to Barclays' Investment Banking compliance function (Compliance) on three occasions during 2007 and 2008. In each case Compliance failed to assess and address the issues effectively. Compliance's failures meant that Barclays' breaches of Principles 5 and 3 were allowed to continue. Compliance's failures also led to unclear and insufficient communication about issues to the FSA. - Penalty The integrity of benchmark reference rates such as LIBOR and EURIBOR is of fundamental importance to both UK and international financial markets. Barclays' misconduct could have caused serious harm to other market participants. Barclays' misconduct also created the risk that the integrity of LIBOR and EURIBOR would be called into question and that confidence in or the stability of the UK financial system would be threatened. The FSA therefore considers it is appropriate to impose a very significant financial penalty of £59.5 million on Barclays in relation to its misconduct during the Relevant Period. In determining the appropriate level of penalty, the FSA has had regard to mitigating factors. In particular, Barclays has provided extremely good co-operation during the course of the FSA's investigation. Barclays' co-operation has enabled the FSA to conduct its investigation efficiently and expeditiously. William Amos Head of Department, Retail 1

On 14 January 2011 the FSA imposed a financial penalty of £7.7 million on Barclays Bank plc (Barclays) for breaches of the FSA's Principles and rules which occurred between July 2006 and November 2008 in relation the sale of Aviva's Global Balanced Income Fund and Global Cautious Income Fund (the 'Funds'). Barclays agreed to settle at an early stage of the FSA's investigation. It therefore qualified for a 30% (Stage 1) discount under the FSA's executive settlement procedures. Were it not for this discount, the FSA would have imposed a financial penalty of £11m on Barclays. Barclays breached Principle 9 during the Relevant Period in that it failed to take reasonable care to ensure the suitability of its advice regarding the Funds for customers entitled to rely upon its judgement. The customers were typically in or near retirement and included inexperienced investors. The firm's failings include the following: (1) The training material given to Barclays staff was inadequate. It did not identify the types of customers the Funds were suitable for. Nor did it explain clearly that, when markets go down, customers who drew income from the Funds were at risk of their capital being eroded and the amount of income they could draw declining over time. In relation to the Balanced Fund, it did not state that these were significant risks. The training material failed to make staff aware that the Funds were unlikely to be appropriate for customers who wanted capital growth as an investment objective. (2) The sales briefs and product updates Barclays sent to its advisers increased the risk of the Funds being mis-sold because they referred only to the potential benefits of investing in the Funds. They did not refer to any of the risks nor the need for those risks to be clearly communicated to prospective customers. (3) Product brochures and other documentation given to customers contained inadequate information and statements which could have misled customers about the nature and levels of risk involved. The documents did not clearly and prominently explain the extent to which an investment in the Funds was linked to fluctuations in the stock market. For those who drew income from the Funds, it did not explain the risk of capital loss and the negative impact this would have on the amount of income produced by the Funds. (4) Barclays failed to put in place adequate procedures for monitoring of sales of the Funds and this resulted in a failure to promptly identify and investigate potentially unsuitable sales. Where compliance monitoring identified particular issues, Barclays failed to take appropriate and timely action, including by implementing a past business review. Barclays also breached COB 5.3.5R and COBS 9.2.1R. As a consequence of the above failings, Barclays customers were exposed to an unacceptable risk of unsuitable sales and a number of unsuitable sales were made. By 7 December 2010, 1676 customers had complained about their investment in the Funds and compensation of approximately £17 million had been paid. It is expected that further compensation of between £20 million and £42 million will be paid. Seriousness of the breaches and mitigating factors The breaches are viewed as particularly serious because Barclays identified, at an early stage, concerns with the Funds but did not take adequate steps to mitigate those concerns. In particular, Barclays identified: 1. The Funds' enhanced income objective was likely to appeal to vulnerable customers, such as those inexperienced in stock market investments and the elderly looking to invest their retirement savings to generate additional income. 2. Customers may not be able to understand the risks of the Funds because of their complex characteristics. 3. In relation to the Balanced Fund, that its risk categorisation was at the upper end of 'balanced' and additional controls in its sales processes were therefore required to mitigate thiskof unsuitable sales. The FSA has also taken the following into account when considering the seriousness of the breaches: 1. A large number of investors were placed at risk and the potential impact was significant. During the Relevant Period, the total number of customers who invested in the Funds is 12,331 with investments totalling £692 million. 2. The mis-conduct spanned more than 2 years. Barclays is undertaking a comprehensive past business review to ensure that customers do not lose out as a result of the failings identified by the FSA. In particular, Barclays has agreed in consultation with the FSA for a third party firm of accountants to review customer files for sales made during the Relevant Period to ascertain whether those sales were suitable. As part of this process, customers may be contacted if this is necessary to allow a decision on suitability to be made. For those sales which are found to be unsuitable, redress will be paid to the customer to ensure he or she has not lost out financially. Barclays past business review described above has been taken into account when deciding upon the level of disciplinary sanction. It is difficult to predict at this stage, but the total amount Barclays will have to pay to customers could be as much as £60 million.

On 19 August 2009, the FSA imposed a penalty on Barclays Bank plc and Barclays Capital Securities Limited (Barclays) of £2,450,000 (discounted from £3,500,000 for early settlement) in respect of breaches of SUP 17 of the FSA Handbook and breaches of Principles 2 and 3 of the FSA's Principles for Businesses which occurred between 1 October 2006 and 31 October 2008. The breach of SUP 17 related to Barclays failure to submit accurate transaction reports as required in respect of an estimated 57.5 million transactions. Barclays breached Principle 2 by failing to conduct its business with due skill, care and diligence in failing to respond sufficiently to opportunities to review the adequacy of its transaction reporting systems. Barclays breached Principle 3 by failing to take reasonable care to organise and control its affairs responsibly and effectively, with adequate risk management systems, to meet the requirements to submit accurate transaction reports to the FSA