Jes Staley’s City ban is a seismic event for UK financial services – here’s why

Published

2 years ago

October 13, 2023

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It is a list that includes the former HBOS banker Peter Cummings, the former Co-op Bank finance director Barry Tootell and the former Credit Suisse First Boston trader James Archer, son of the author and Conservative peer Lord Archer – and now it includes Jes Staley, the former Barclays chief executive.

Banning someone from working in financial services is one of the ultimate sanctions that can be brought to bear by the Financial Conduct Authority (FCA). It is a draconian measure and one the regulator exercises relatively rarely.

That makes the ban imposed today on Mr Staley – who is appealing against the judgement – all the more extraordinary.

Make no mistake, this is an absolutely seismic event.

Being chief executive of one of Britain’s ‘big four’ commercial banks – Barclays, NatWest, HSBC and Lloyds – are among the most prestigious roles UK financial services has to offer. Never before, though, has a chief executive of one of the four ended up being banned from the City.

Think about some of the great bankers of the past who have led the four, for example, Sir Brian Pitman at Lloyds or Sir Willie Purves at HSBC. The idea of them finding themselves in such circumstances, being banned from the City, is unthinkable.

The irony is that, when Mr Staley arrived at Barclays in 2015, he was seen as offering the bank stability.

The door into the Barclays CEO’s office had long been a revolving one. Martin Taylor, CEO since 1994, was felled after a boardroom coup in 1998. His successor, Michael O’Neill, lasted a day in the job after failing his medical. Then came Matt Barrett, who lasted until 2004 with just a few mishaps, including telling a Commons select committee he would not allow his children to have a credit card.

The popular Irish-Canadian’s successor was less fortunate. John Varley, who lasted until 2010, was later charged – and later acquitted – with conspiracy to commit fraud over a financial crisis-era fund-raising. Bob Diamond, who succeeded him, was sacked on the orders of Mervyn King, the then Bank of England governor, over the bank’s Libor-rigging.

Antony Jenkins, CEO from 2012 to 2015, was supposed to mark a change from Mr Diamond, under whom the investment bankers had reigned supreme in Barclays. The former head of the bank’s relatively unsung retail operations, he was nicknamed ‘Mr Nice’ internally, for his efforts to rebuild the reputation of Barclays and to distance it from the legacy issues, chiefly the Libor scandal, that had laid it low.

Unfortunately for him, he fell victim to the revenge of the investment bankers, who had never trusted him.

John McFarlane, the guitar-strumming, Feng Shui-loving, chairman at the time, decided that Mr Jenkins’s successor needed to be someone who understood investment banking as well as commercial and retail banking.

It was for that reason that he reached for Mr Staley, a Wall Street veteran who had spent 35 years at JPMorgan, although much of that time had been spent in the bank’s asset management and private banking divisions rather than in out-and-out investment banking on trading.

Very much a ‘Boston brahmin’ – his grandfathers were a top retail executive and the president of Massachusetts Institute of Technology and his father the CEO of a chemicals company – Mr Staley initially made a good impression.

But he quickly blotted his copy book, being fined and censured by the regulator for trying to unmask a whistle-blower, which proved an unwanted distraction. So, too, did a long-running campaign by Edward Bramson, an activist investor, who sought unsuccessfully to get Barclays to spin off its investment banking arm.

Mr Staley finally seemed to have won the day when, in November 2021, he was forced out over his links with Jeffrey Epstein.

By then, evidence unearthed by the FCA and the Bank of England’s Prudential Regulation Authority had revealed he was far closer to the disgraced paedophile than he had let on, with more than 1,200 emails between him and Epstein dating back to his time at JPMorgan containing mysterious phrases such as ‘snow white’.

It subsequently emerged that Mr Staley had even pressed executives at JPMorgan to retain Epstein as a client even after he had been jailed for soliciting sex from a minor.

Shockingly, some of the emails – cited by the FCA today – even revealed that Mr Staley told Epstein he was in talks to take the top job at Barclays, prior to his appointment.

The ban and fine issued today is not the end of the matter.

Mr Staley has appealed against the decision – which is why the FCA today called it ‘provisional’ – and has taken it to the FCA’s Upper Tribunal. It has overturned a number of such bans in recent years, including one in 2021 on the Scottish insurance executive Stuart Forsyth and one in 2019 against Andrew Tinney, a former chief operating officer of Barclays Wealth.

The Upper Tribunal has, in recent times, been highly critical of the FCA’s high staff turnover and decision-making – while the burden of proof faced by the regulator is far heavier than that faced by Mr Staley himself.

Quite apart from his determination to clear his name, this is probably why Mr Staley – who at 66 might be forgiven for wanting to go and enjoy the riches he has accumulated in his career – is persisting with an appeal.

As for Barclays, now being steered by the low-key CS Venkatakrishnan, it probably wishes the whole thing would go away.

Business

Hundreds of jobs at risk as River Island takes axe to store base

Published

12 hours ago

June 20, 2025

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Hundreds of jobs at risk as River Island takes axe to store base

Hundreds more high street jobs are being put at risk as part of a sweeping overhaul of the family-owned fashion retailer River Island.

Sky News has learnt that the clothing chain, which trades from about 230 stores, is proposing to close 33 shops in a restructuring plan which will be put to creditors in August.

The fate of a further 70 stores is dependent upon agreements being reached with landlords to slash rent payments.

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Confirmation of the plans comes less than a month after Sky News revealed that the company, which was founded in 1948 by Bernard Lewis, was working with PricewaterhouseCoopers (PwC) on a restructuring plan.

In a statement issued on Friday, Ben Lewis, River Island’s chief executive, said: “River Island is a much-loved retailer, with a decades-long history on the British high street.

“However, the well-documented migration of shoppers from the high street to online has left the business with a large portfolio of stores that is no longer aligned to our customers’ needs.

“The sharp rise in the cost of doing business over the last few years has only added to the financial burden.

“We have a clear strategy to transform the business to ensure its long-term viability.

“Recent improvements in our fashion offer and in-store shopping experience are already showing very positive results, but it is only with a restructuring plan that we will be able to see this strategy through and secure River Island’s future as a profitable retail business.

“We regret any job losses as a result of store closures, and we will try to keep these to a minimum.”

The company declined to comment on how many jobs would be put at risk by the initial 33 shop closures, or on the scale of the rent cuts being sought during talks with landlords.

In total, it is understood to employ about 5,500 people.

Sources said that new funding will be injected into River Island if the restructuring plan is approved in August.

Previously named Lewis and Chelsea Girl, the business, it adopting its current brand during the 1980s.

Accounts for River Island Clothing Co for the 52 weeks ended 30 December 2023 show the company made a £33.2m pre-tax loss.

Turnover during the year fell by more than 19% to £578.1m.

A restructuring plan is a court-supervised process which enables companies facing financial difficulties to compromise creditors such as landlords in order to avoid insolvency proceedings.

An identical process is being used to close scores of Poundland shops and slash rents at hundreds more.

In its latest accounts at Companies House, River Island Holdings Limited warned of a multitude of financial and operational risks to its business.

“The market for retailing of fashion clothing is fast changing with customer preferences for more diverse, convenient and speedier shopping journeys and with increasing competition especially in the digital space,” it said.

“The key business risks for the group are the pressures of a highly competitive and changing retail environment combined with increased economic uncertainty.

“A number of geopolitical events have resulted in continuing supply chain disruption as well as energy, labour and food price increases, driving inflation and interest rates higher and resulting in weaker disposable income and lower consumer confidence.”

Retailers have complained bitterly about the impact of tax changes announced by Rachel Reeves, the chancellor, in last autumn’s Budget.

Since then, a cluster of well-known chains, including Lakeland and The Original Factory Shop, have been forced to seek new owners.

Business

Post Office Capture scandal: Sir Alan Bates calls for those responsible for wrongful convictions to be ‘brought to account’

Published

17 hours ago

June 20, 2025

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Post Office Capture scandal: Sir Alan Bates calls for those responsible for wrongful convictions to be 'brought to account'

Sir Alan Bates has called for those responsible for the wrongful convictions of sub postmasters in the Capture IT scandal to be “brought to account”.

It comes after Sky News unearthed a report showing Post Office lawyers knew of faults in the software nearly three decades ago.

The documents, found in a garage by a retired computer expert, describe the Capture system as “an accident waiting to happen”.

Sir Alan said the Sky News investigation showed “yet another failure of government oversight; another failure of the Post Office board to ensure [the] Post Office recruited senior people competent of bringing in IT systems” and management that was “out of touch with what was going on within its organisation”.

The unearthed Capture report was commissioned by the defence team for sub postmistress Patricia Owen and served on the Post Office in 1998 at her trial.

It described the software as “quite capable of producing absurd gibberish” and concluded “reasonable doubt” existed as to “whether any criminal offence” had taken place.

Ms Owen was found guilty of stealing from her branch and given a suspended prison sentence.

She died in 2003 and her family had always believed the computer expert, who was due to give evidence on the report, “never turned up”.

Adrian Montagu reached out after seeing a Sky News report earlier this year and said he was actually stood down by the defending barrister with “no reason given”.

The barrister said he had no recollection of the case.

Victims and their lawyers hope the newly found “damning” expert report, which may never have been seen by a jury, could help overturn Capture convictions.

‘These people have to be brought to account’

Sir Alan, the leading campaigner for victims of the Horizon Post Office scandal, said while “no programme is bug free, why [was the] Post Office allowed to transfer the financial risk from these bugs on to a third party ie the sub postmaster, and why did its lawyers continue with prosecutions seemingly knowing of these system bugs?”

He continued: “Whether it was incompetence or corporate malice, these people have to be brought to account for their actions, be it for Capture or Horizon.”

More than 100 victims have come forward

More than 100 victims, including those who were not convicted but who were affected by the faulty software, have so far come forward.

Capture was used in 2,500 branches between 1992 and 1999, just before Horizon was introduced – which saw hundreds wrongfully convicted.

The Criminal Cases Review Commission (CCRC), the body responsible for investigating potential miscarriages of justice, is currently looking at a number of Capture convictions.

A CCRC spokesperson told Sky News: “We have received applications regarding 29 convictions which pre-date Horizon.
25 of these applications are being actively investigated by case review managers, and two more recent applications are in the preparatory stage and will be assigned to case review managers before the end of June.

“We have issued notices under s.17 of the Criminal Appeal Act 1995 to Post Office Ltd requiring them to produce all material relating to the applications received.

“To date, POL have provided some material in relation to 17 of the cases and confirmed that they hold no material in relation to another 5. The CCRC is awaiting a response from POL in relation to 6 cases.”

A spokesperson for the Department for Business and Trade said: “Postmasters negatively affected by Capture endured immeasurable suffering. We continue to listen to those who have been sharing their stories on the Capture system, and have taken their thoughts on board when designing the Capture Redress Scheme.”

Business

Government considering measure to slash industrial energy prices

Published

1 day ago

June 19, 2025

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Government considering measure to slash industrial energy prices

Ministers are considering a commitment to cut soaring industrial energy prices for British companies to the same level enjoyed by competitors in France and Germany as part of its industrial strategy.

Sky News understands proposals to make energy prices more competitive are at the heart of final discussions between the Department for Business and Trade and the Treasury ahead of the publication of its industrial strategy on Monday.

Industrial electricity prices in the UK are the highest in the G7 and 46% above the median for the 32 member states of the International Energy Agency, which account for 75% of global demand.

In 2023, British businesses paid £258 per megawatt-hour for electricity compared to £178 in France and £177 in Germany, according to IEA data. Matching those prices will require a reduction of around 27% at a cost of several billion pounds.

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Earlier this month, automotive giant Nissan said UK energy prices make its Sunderland plant its most expensive in the world.

Business secretary Jonathan Reynolds is understood to be sympathetic to business concerns, and chancellor Rachel Reeves told the CBI’s annual dinner the issue of energy prices “is a question we know we need to answer”.

Extending relief

While around 350 companies in energy-intensive industries, including steel, ceramics and cement, enjoy some relief from prices through the energy supercharger scheme, which refunds 60% of network charges and is expected to rise to 90%, there is currently no support for manufacturers.

Sky News understands ministers are considering introducing a similar scheme to support the 200,000 manufacturing businesses in the UK.

Cutting network costs entirely could save more than 20% from electricity prices.

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The mechanism for delivering support is expected to require consultation before being introduced to ensure only businesses for whom energy is a central cost would benefit. This could be based on the proportion of outgoings spent on energy bills.

It is not clear how the scheme would be funded, but the existing industrial supercharger is paid for by a levy on energy suppliers that is ultimately passed on to customers.

A central demand

Bringing down prices, particularly for electricity, has been the central demand of business and industry groups, with Make UK warning high prices are rendering businesses uncompetitive and risk “deindustrialising” the UK.

The primary driver of high electricity costs in the UK is wholesale gas, which both underpins the grid and sets the price in the market, even in periods when renewables provide the majority of supply.

Why are costs so high?

Wholesale prices account for around 39% of bills, with operating costs and network charges – the cost of using and maintaining the grid – making up another 25%, and VAT 20%.

Business groups, including the manufacturers group Make UK, have called for a reduction in those additional charges, as well as the so-called policy costs that make up the final 16% of bills.

These are made up of levies and charges introduced by successive governments to encourage and underwrite the construction of renewable sources of power.

Make UK estimate that shifting policy costs into general taxation would cost around £3.8bn, but pay for itself over time in increased growth.

Government sources confirmed that energy prices are a central issue that the industrial strategy will address, but said no final policy decisions have been agreed.

The industrial strategy, which is delayed from its scheduled publication earlier this month, will set out the government’s plans to support eight sectors identified as having high-growth potential, including advanced manufacturing, life sciences, defence and creative industries.