Why was City titan Jes Staley visiting a paedophile? Barclays customers might question chief executive’s judgement over contact with Jeffrey Epstein, writes RUTH SUNDERLAND
Most convicted criminals receive visits from their lawyer or probation officer – not from one of the richest and most powerful bankers on the planet.
But while the late Jeffrey Epstein was jailed in Florida for procuring a child for prostitution, who should pop in but Jes Staley, who was then a high-ranking executive at J P Morgan, and is now the embattled chief executive of Barclays.
The high street lender denies that its boss actually visited Epstein behind bars, saying Staley saw the paedophile billionaire at the latter’s office in Palm Beach, where he was allowed out on ‘work release’ during the 13 months he served of his 18-month sentence.
Powerful friends: Jes Staley, circled, with Larry Summers and Jeffrey Epstein in 2011. Now – and not before time – Staley’s relationship with Epstein has come under the scrutiny of City regulators who are determined to root out the truth
It is still, however, extremely unorthodox for a titan of the City and Wall Street such as Staley – who is responsible for billions of pounds of British savers’ money – to consort with a known criminal undergoing a prison term. No doubt Barclays’ 24 million UK customers, who have entrusted his bank with their deposits and mortgages, will take a dim view of him fraternising with any jailbird, let alone a notorious multimillionaire paedophile.
Now – and not before time – Staley’s relationship with Epstein has come under the scrutiny of City regulators who are determined to root out the truth.
They are investigating whether he was as open as he ought to have been with the board at Barclays when they hired him as their £6 million-a-year CEO in 2015, or whether he understated the extent of the ties between himself and Epstein.
For Epstein, then a financier with his own firm, Staley was a gateway to the power brokers of Wall Street. Pictured: Jes Staley with his wife Debora in 2012
Even if the watchdogs find there was no impropriety, the affair raises questions about Staley’s judgment, which is worrying given his position at the helm of a £31 billion bank, one of the pillars of this country’s financial system.
In the past he has claimed to have been at best an acquaintance of Epstein and certainly not a close friend. Now he admits the pair enjoyed a close professional relationship for years, a connection established when he was running J P Morgan’s private bank and asset management division from 2000 to 2009.
For Epstein, then a financier with his own firm, Staley was a gateway to the power brokers of Wall Street. But why, one might ask, would a grandee such as the Barclays boss consent to mix with such a sordid character?
Mr Staley and his Brazilian heiress wife Debora visited Epstein on Little St James, one of his two private islands in the Caribbean (pictured)
The answer lies in Epstein’s Svengali-like ability to attract wealthy and influential friends and to act as a fixer.
Any qualms at J P Morgan over his record as a sex offender appear to have been outweighed by the lucrative business he might bring their way. ‘Epstein was an uber-networker, a magnet for important people, and that is valuable currency for a banker like Jes,’ said one City source.
In Staley’s defence, he was not the only one taken in. A photograph taken at his Manhattan mansion nine years ago shows Epstein at the centre of a line-up of moguls, among them former US Treasury Secretary Larry Summers. A broadly smiling Staley, looking relaxed with his hands in his pockets and wearing an open-necked shirt, is at the edge of the group. He claims he has had no contact with Epstein since joining Barclays in December 2015. However, the two kept in touch up until very close to that point.
In April of that year, by which time Staley had left J P Morgan and joined hedge fund Blue Mountain, he and his Brazilian heiress wife Debora visited Epstein on Little St James, one of his two private islands in the Caribbean.
Staley claims the couple were on holiday on their luxury 90ft yacht, the Bequia, and happened to sailing past Epstein’s hideaway. They dropped in for lunch and did not discuss business.
Shortly after, he is believed to have broken off ties when he became a serious contender for the top job at Barclays. Intriguingly, however, just before his appointment was confirmed in the autumn of 2015, our sister paper The Mail on Sunday reported that Epstein had been cheerleading for his friend to be taken on as chief executive on a previous occasion in 2012.
At that time, Staley, who denies asking Epstein to lobby for him, lost out on the job.
Barclays says its board was not lobbied by Epstein. But it’s easy to see why the disgraced financier would have wished to see his friend Jes installed in one of the biggest banking jobs in the world. Epstein may have tried off his own bat to drum up backing on his behalf, however ineffectually.
Staley has committed other lapses. He was fined by City regulators for trying to unmask a whistle-blower, and also became embroiled in a dispute with private equity firm KKR when he intervened in a row on behalf of his brother-in-law.
Embarrassingly, he was taken in by a prankster posing as the Barclays chairman in an email exchange. Then he was forced into doing a U-turn last year over an ill-advised move to bar customers from taking cash out over the counter at Post Offices after a Daily Mail campaign.
Patience with him was already wearing thin in government circles after that debacle.
Barclays has already dropped its sponsorship of Prince Andrew’s initiative to help entrepreneurs, Pitch@Palace, in the wake of the Epstein scandal.
The question now is whether the bank’s own chief executive can survive the toxic fallout.
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