UK finance boss now accused of sorting out ‘questionable’ £ 2bn loan
The former UK Finance boss embroiled in a sexism feud has been drawn deeper into Amanda Staveley’s £ 1.6bn High Court battle with Barclays.
Staveley, a senior financier, accused Stephen Jones of devising a ‘bad’ £ 2 billion loan as Barclays struggled to avoid a government bailout in 2008.
Jones resigned as boss of the lobby group on Tuesday after making “highly derogatory” comments about Staveley during the financial crisis.
Amanda Staveley: Top financial, accused of top Barclays officers of “sexism and misogyny”
But as managing director of Barclays Capital at the time, he also helped arrange a loan with Qatari investors that Staveley said could have been illegal.
Staveley, who broke down in tears yesterday after being accused of trying to ‘rob’ Barclays of hundreds of millions of pounds, previously told the court Barclays had secretly offered Qatari investors the £ 2 billion loan behind its back, while hiding it from shareholders.
She suggested that the money, on loan in November 2008, was used to invest in shares of Barclays – a prohibited practice known as financial aid.
In October 2008, the bank was desperate to avoid a government bailout by raising £ 7.3 billion from investors in the Middle East, the court said.
Staveley and his company PCP Capital helped secure a bailout from investors in Abu Dhabi.
Yellow Pages Fraud Claim
By TOM WITHEROW and JAMES BOOTH
UK Finance chairman is subject to a hearing next month over a multi-million pound complaint alleging he defrauded shareholders while he was chairman of Yellow Pages owner Hibu .
The affair in the United States has been a major headache for city greats, Bob Wigley, who lost chief executive Stephen Jones to a row over sexism earlier this week.
Court hearing: Town’s Grand Mayor Bob Wigley accused of defrauding shareholders while he was chairman of Yellow Pages owner Hibu
The claim concerns Wigley’s time as chairman of the Hibu directory company, which crashed under administration in 2013, wiping out the holdings of smaller shareholders.
An action group of 450 aggrieved former shareholders sued Wigley, Hibu and other directors of the company in the United States last summer.
The case is expected to be taken to U.S. District Court in Philadelphia on July 20 on a motion to dismiss the claim, according to documents filed in the United States this week.
The lawsuit, first filed in August last year, alleges that Wigley and Hibu chief executive Mike Pocock, who died in December 2018, misled shareholders with positive updates on the position of company, while transferring money to subsidiaries to prepare for administration.
The claim accuses Hibu and its former directors of fraudulent misrepresentation, deception and negligent inaccuracies.
The allegation read: “The conspiracy culminated when, in covert cooperation with its lenders, the company effectively divested itself of its assets in order to qualify for ‘administration’ and extinguished the rights of its shareholders, without any compensation.”
The defense argues that the case should be dismissed as the court has no jurisdiction over the defendants and the claim was filed too late.
Chris Belcher, of the Hibu action group, said shareholders took the case to the United States after feeling disappointed with Britain’s regulatory response to their claims.
Wigley could not be reached for comment yesterday.
She said Barclays told her six times that PCP and Abu Dhabi investors would be offered the same deal as the Qataris, it is claimed.
Instead, the bank is accused of misleading the markets and paying an additional £ 346million in secret fees to Qataris, a move that “smacked of corruption”, according to court documents.
Staveley is claiming between £ 400 billion and £ 1.6 billion in damages.
The loan, according to the witness statement for Staveley, was “a large unsecured loan the purpose of which seemed to change during the negotiations”.
This caused immense concern within Barclays because banks were cutting risky borrowing to protect their balance sheets, it is claimed.
Former boss: Jones designed ‘questionable’ £ 2bn loan as Barclays fought to avoid a government bailout in 2008
But the court heard that pressure was exerted by former chief executive Bob Diamond to close the deal, with Jones saying on an appeal: “We have to find a way to make this funding available.”
The loan was made weeks after Qatar’s investment in Barclays, it is claimed, and Jones admitted that “we would go to jail” if the money was “explicitly to fund capital raising efforts.”
In court documents, Staveley’s PCP company claims that the granting of the loan constituted unlawful financial aid under the 1985 Companies Act. Barclays disputes the claim, saying that the loan agreement explicitly precludes Qatar from use the money in this way.
Yesterday Staveley was accused of lying by Barclays’ lawyer.
Jeffery Onions QC dismissed Staveley’s claim that she was crucial to the Abu Dhabi bailout deal and described her as an inexperienced gamer willing to use false documents to make her fortune.
He said: “You were indeed engaged in what one might colloquially call a commotion – trying to put yourself in the center. You had no funds to invest, and nothing to offer.
Staveley also accused top Barclays officers of “sexism and misogyny”, with executives calling her “tangy” and “foxy blonde”.
Jones’ personal comments on Staveley were not disclosed, but he said they were “totally inappropriate”. I regret having made these comments and I cannot defend them and I will not seek to do so ”. UK Finance declined to comment.
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