FCA Fines Barclays £40 Million for Failing to Disclose Qatari Investor Arrangements in 2008 Capital Raisings

The Financial Conduct Authority fined Barclays PLC and Barclays Bank PLC a combined £40 million on 25 November 2024 for failing to disclose the full terms of their arrangements with Qatari investors during the bank's emergency capital raisings at the height of the 2008 financial crisis. The regulator found that both entities breached the Listing Rules (and, in Barclays PLC's case, Listing Principle 3) by withholding material information from the market and from other investors who participated in the fundraising rounds.

The capital raisings in question took place in June and October 2008, when Barclays sought to secure its balance sheet without drawing on British government support. The bank sought to raise up to £4.5 billion in June and £7.3 billion in October.

UNDISCLOSED ADVISORY AGREEMENTS

At the core of the FCA's findings is Barclays' failure to disclose advisory services agreements entered into with Qatar Holding LLC, the investment arm of the Qatar Investment Authority, which together with the Qatari investment vehicle Challenger Universal anchored both capital raisings. Those agreements provided for advisory fees totalling £322 million (£42 million in June and £280 million in October), paid by Barclays in connection with the Qatari entities' participation in the capital raisings. The FCA concluded that these arrangements were material and that their omission from the required disclosures gave the market an incomplete picture of the terms on which cornerstone investment had been secured.

Investors who participated in the capital raisings without knowledge of the fee arrangements were, in the FCA's assessment, misled.

PENALTY AND BREACHES

The FCA's investigation into the 2008 capital raisings spanned more than a decade. The combined fine of £40 million is apportioned between Barclays PLC, which will pay £30 million, and Barclays Bank PLC, which has been assessed a penalty of £10 million. Barclays PLC was penalised for breaching LR 1.3.3R, LR 13.3.1R(3) and Listing Principle 3, and Barclays Bank PLC for breaching LR 1.3.3R.

Steve Smart, the FCA's joint executive director of enforcement and market oversight, said Barclays' misconduct "was serious and meant investors did not have all the information they should have had". The enforcement action concluded after Barclays withdrew its reference to the Upper Tribunal; the FCA had proposed a £50 million penalty in its 2022 decision notices.