RUTH SUNDERLAND: One stain he couldn’t wash away… Barclays boss Jes Staley had seemed like the banker with nine lives
Until his shocking departure yesterday, £4million-a-year Barclays boss Jes Staley had seemed like the banker with nine lives.
The 64-year-old American Master of the Universe had shown an almost preternatural ability to survive blows that would have felled any other chief executive.
His unparalleled skills as a money-maker meant Barclays was willing to overlook a string of very serious black marks against him.
Even Staley, however, could not get out of this one.
And however much the bank and its shareholders may have wanted to overlook his ties with the billionaire paedophile Jeffrey Epstein because of his financial acumen, the situation had become untenable.
Barclays Group CEO Jes Staley has departed after his friendship with convicted sex offender Jeffrey Epstein cameunder intense scrutiny
The finding by City watchdogs that the Barclays boss had underplayed the closeness of his relationship with a convicted sex offender meant it was impossible for Staley to continue at the helm of one of Britain’s foremost financial institutions.
As Barclays reluctantly recognised, if he had remained in his post, it would have cast an unacceptable shadow over the bank’s corporate ethics.
And there can be no doubt many of its 24million UK customers would be horrified that the CEO they trusted with their savings and home loans had been rubbing shoulders with such a vile individual.
For the banking industry, still struggling to regain public trust after the excesses of the Fred Goodwin era, this is a disaster that will reverberate beyond Barclays.
And while Staley’s departure has no bearing on the sexual assault lawsuit against Prince Andrew brought by Virginia Roberts under her married name Giuffre, the fact that Barclays has felt it necessary to part company with its star chief executive demonstrates its concern about its reputation.
If a high street bank feels unable to tolerate a senior figure tainted by Epstein, it raises uncomfortable questions for Buckingham Palace.
Even Staley himself acknowledges that his continued presence would be a distraction from the bank’s work.
The cost of his ill-judged association with Epstein is clear. This is a shockingly ignominious end to a career at Barclays that started with such high hopes.
Only a decade ago, he was tipped to be the next King of Wall Street as successor to Jamie Dimon, the legendary JP Morgan boss.
Staley came to Barclays in 2015 after the bank had been dragged through a series of debacles during the financial crisis – one of which resulted in another former CEO facing fraud charges, although he was later acquitted.
The bank began to regain its swagger with the arrival of Staley, a beefy Bostonian investment banker who had made a big name for himself on Wall Street over 34 years at JP Morgan.
The father of two landed in London with all the accoutrements of a New York Mr Big: an apartment on Park Avenue, Manhattan, a property in the Hamptons and a sleek blonde Brazilian wife, Debora, an heiress in her own right.
A keen sailor, he also had his own 90ft yacht, the Bequia, named after the Caribbean island where he and his bride spent their honeymoon 25 years earlier.
At Jeffrey Epstein’s Manhattan mansion in 2011, from left: James E. Staley, at the time a senior JPMorgan executive; former Treasury Secretary Lawrence Summers; Mr. Epstein; Bill Gates, Microsoft’s co-founder; and Boris Nikolic, who was the Bill and Melinda Gates Foundation’s science adviser
The couple met in the 1980s, after JP Morgan sent him to work in Brazil, where her rich Jewish family had founded data firm Aceco.
The yacht’s name was a romantic gesture from a man still married to his first love – rare in a world where beautiful blonde wives are traded for younger versions as soullessly as shares.
Rather less romantic was the role the vessel would play in Staley’s friendship with Epstein. In April 2015, after he had left JP Morgan and taken a post at the Blue Mountain hedge fund, the couple visited Epstein on Little Saint James, one of his two private Caribbean islands.
Staley claimed he and Debora were on holiday and happened to be sailing past Epstein’s hideaway – nicknamed ‘paedophile island’ – so they popped in for lunch.
Barclays customers may well scratch their heads over why on earth the man with stewardship of their current accounts would have paid a social call on such a man.
He says he severed all dealings with Epstein before taking charge in December 2015. But there was certainly plenty of contact before that and Staley has admitted the links between the pair were forged over 15 years.
‘As Barclays reluctantly recognised, if [Staley] had remained in his post, it would have cast an unacceptable shadow over the bank’s corporate ethics’
He says a purely professional relationship started when he took over JP Morgan’s private bank in 2000.
In private banking circles, being chums with wealthy individuals is a valuable currency so the ultra well-connected Epstein must have seemed like a good man to know.
Towards the end of that decade, however, his disgusting proclivities were well aired and one might have expected Staley to keep a distance.
Yet in 2009, still working at JP Morgan, he saw fit to pay a visit to the sex trafficker while he was serving a prison sentence. Staley dropped in at Epstein’s office in Palm Beach, where the latter was on work release during the 13 months he served of an 18- month sentence for procuring a child for prostitution.
A couple of years later, in 2011, the banker was pictured in a photograph at Epstein’s Manhattan mansion, with other grandees including former US Treasury Secretary Larry Summers and billionaire Microsoft founder Bill Gates.
This willingness to rub shoulders with a known sex offender who preyed on vulnerable individuals is at odds with Staley’s political correctness in the workplace. He was a key figure in making JP Morgan an LGBT-friendly company.
Big City shareholders and the Barclays board have until now been willing to support Staley through a number of scandals, including hefty fines for trying to hunt down a whistleblower and a controversy with private equity giant KKR over a failed deal involving his brother-in-law.
One can see why. Staley was held in high esteem in the City, as was apparent from the near 3 three per cent fall in the share price after his departure was announced.
His big financial gamble, to keep Barclays’ full-scale ‘casino’ investment bank in the teeth of some powerful opposition, is paying off.
The bank’s share price has risen nearly 90 per cent this year and has done better than its rivals.
What a tragic irony it is that a man so smart he could have done great things for UK banking has been humbled by his catastrophic misjudgment over Epstein.
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